Pacira Pharmaceuticals Inc. is a Newark, New Jersey-based pharmaceutical company. It has been accused of paying kickbacks to doctors in an effort to get them to prescribe EXPAREL. According to the EXPAREL website, the medication provides significant long-lasting, non-opioid pain management for those who are coming out of surgical procedures.
The kickbacks Pacira gave doctors came in the form of fraudulent research grants.
As reported by the District of New Jersey branch of the United States Department of Justice this week, Pacira has agreed to pay $3.5 million in order to resolve allegations that it violated the False Claims Act. According to the DoJ report, documents filed in this case showed that between December of 2012 and April of 2015, Pacira ran its illegal kickback scheme.
As mentioned, the company disguised its kickbacks in the form of research and other grants to healthcare providers and institutions. It intended for these payments to induce sales of its newly-launched local analgesic, EXPAREL.
The drug was targeted to certain physicians and their respective hospitals.
“The research grants in question were typically initiated by Pacira sales representatives or marketing executives, who discussed internally their sales goals in connection with the grant,” says the DoJ report, “Pacira also required that EXPAREL be placed on formulary at the physician’s institution before awarding any research grant.”
However, once the grant money was awarded, Pacira showed almost no interest in the research. They did not require any grant recipient to adhere to any proposed research topic. As well, recipients weren’t expected to achieve any milestones or results before receiving payment. In fact, in many cases, Pacira didn’t even follow up with its grant recipients. They had no idea whether or not any work was performed. In some cases, no work was done at all.
“Pacira did not document why it needed the research or the fair market value of the proposal,” informs the DoJ, “Finally, Pacira executives coached grant recipients and other employees on how to avoid internal scrutiny of the grant payments.”
To make clear, Medicare and Medicaid do not pay out claims for products that have been tainted by illegal kickbacks. Pacira willingly participated in submitting false claims to Medicare and Medicaid by using these research grants to induce sales of EXPAREL. The company did so knowing that the medication could be used in procedures that are reimbursed by the insurance programs.
FBI-Newark Acting Special Agent in Charge Joe Denahan spoke about the case.
“The payment of kickbacks or bribes in exchange for phony research and other grants, robs the government and every American,” he said, “Today’s agreement by Pacira Pharmaceuticals Inc., to pay $3.5 million, should send a strong message to anyone thinking about participating in this type of illegal activity. The FBI remains committed to combating these types of schemes and bringing these perpetrators to justice.”
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