US WorldMeds: The Higher Price and the Money to Cover It

In the US WorldMeds Apokyn settlement, the company agreed to pay $17.5 million to resolve allegations that it paid kickbacks to Medicare patients and physicians to induce prescriptions of Apokyn and Myobloc. The government alleged that US WorldMeds raised Apokyn’s price, then used a foundation to cover the larger copays.

What the US WorldMeds Apokyn Settlement Covered

This pharmaceutical fraud settlement addressed alleged payments at both ends of a prescription: to the patient facing the bill and to the physician choosing the drug. US WorldMeds is a pharmaceutical manufacturer headquartered in Louisville, Kentucky. The Department of Justice announced the resolution on April 30, 2019, following two whistleblower cases in Connecticut.

The patient-assistance allegations concerned Apokyn and a foundation’s Parkinson’s Disease fund. The separate physician allegations concerned both Apokyn and Myobloc. The alleged kickbacks steered prescriptions and purchases at Medicare’s expense, leaving taxpayers to fund the business.

The Apokyn Price Increase and Medicare Copays

The Department of Justice reported that US WorldMeds substantially increased Apokyn’s price around January 2012, pushing Medicare copays above $5,000 per year for many patients.

The whistleblower’s complaint gives a more concrete account of the pricing decision. It alleged that Apokyn cost approximately $138 per cartridge when US WorldMeds acquired the U.S. marketing rights, and that the company raised the cartridge price to $995 shortly afterward. The complaint described a business that expected substantially higher revenue from the increase.

A later study of drug pricing, The Association Between Drug Rebates and List Prices, published by the USC Schaeffer Center in 2020, examined U.S. brand-drug prices from 2015 through 2018. It found that increases in estimated rebates were associated with increases in list prices. The paper also explains why higher list prices hurt insured patients whose coinsurance and deductibles depend on those prices. A discount elsewhere in the payment chain can coexist with a larger bill at the pharmacy.

That makes the Apokyn sequence worth following through the assistance program. The government alleged that US WorldMeds paid Medicare patients’ copays through a third-party foundation from the time of the price increase through June 30, 2013. In that account, the manufacturer funded relief from a patient cost its own pricing decision had increased.

How the Foundation Allegedly Kept Apokyn Affordable

The government alleged that US WorldMeds knew it was the only donor to the foundation’s Parkinson’s Disease fund and that virtually all the fund’s donations went to Medicare Apokyn patients. A fund carrying the name of a disease allegedly spent almost all its donated money on patients taking one donor’s drug.

The copay charity kickback allegation follows the money through the foundation. As the Department of Justice explained, Medicare Part D copays were intended in part to put a check on health care costs. A patient’s share of a covered prescription can take the form of a copayment, coinsurance or a deductible. The Anti-Kickback Statute prohibits manufacturers from paying those obligations, directly or indirectly, to induce Medicare purchases of their drugs. The government alleged that the foundation payments violated that law and the False Claims Act.

The complaint supplies the operational detail behind the donation. It alleged that US WorldMeds and The Assistance Fund communicated to ensure that prospective Apokyn patients covered by government programs would receive assistance. The whistleblower described what happened to applications coming through the manufacturer:

The alleged approval practice matters as much as the donation ledger. It connects the company’s funding to particular patients, the handling of their applications and confirmation back to the company. Employees working on either side of that exchange could see how an assistance program served the manufacturer’s sales.

The economics also appeared in the government’s copay allegations against Amgen. The Department of Justice alleged that Amgen spent more funding Sensipar copays than it would have spent supplying free medicine to financially needy patients. Paying the copays nevertheless generated Medicare claims and revenue for Amgen. That comparison explains why a manufacturer can have a commercial reason to fund assistance even when free medicine would cost it less.

What Employees Allegedly Saw Behind the Sales

Employees allegedly faced restrictions on what they could say about Apokyn’s price and who could see its revenue. The whistleblower described the instruction to sales staff:

According to the complaint, US WorldMeds instructed the whistleblower to keep Apokyn revenue information from sales representatives. The complaint also alleged internal conversations about why the money US WorldMeds supplied to The Assistance Fund was not being spent quickly enough.

Together, those allegations give an employee’s account something a donation total alone cannot provide: what the company wanted its staff to say, what information it restricted and how closely it followed the use of its money.

Free Nurses and the Billing Behind Them

The whistleblower’s complaint also alleged a separate billing arrangement involving manufacturer-paid nurses. US WorldMeds allegedly paid more than $500 per visit for nurses to administer Apokyn and adjust the initial dose, while providing those visits at no charge to doctors or patients.

According to the complaint, the company encouraged doctors to bill patients and insurers, including government programs, as though the doctor had performed the service and spent enough time with the patient for a level three or four visit.

The complaint further alleged that nurses in the company’s Circle of Care program received bonuses for obtaining completed paperwork that kept patients on Apokyn. Those allegations show why nursing assignments, payment arrangements and prescription paperwork can matter alongside the foundation’s application records.

Physician Payments and the Corporate Integrity Agreement

The government separately alleged that US WorldMeds paid two physicians excessive speaking and consulting fees to induce Apokyn and Myobloc prescriptions. It also alleged lavish meals, private-plane rides and all-expense-paid trips with their spouses, including trips to the Kentucky Derby.

Those alleged payments for prescribing reached the physician, while the foundation payments reached the patient’s share of the bill. Both were part of the civil resolution.

The five-year Corporate Integrity Agreement with the Department of Health and Human Services Office of Inspector General addressed both sides of that problem. As described in the settlement announcement, it required measures governing promotional activities and arrangements with third-party patient-assistance programs.

The Whistleblowers’ Share of the Recovery

The qui tam cases began with whistleblowers, and the Department of Justice announced that the whistleblowers would collectively receive $3.15 million as their share of the recovery. Their cases brought the alleged patient and physician payments to the government.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. In a case involving drug prices and patient assistance, the useful insider knowledge connects the company’s payments with the prescriptions and government claims they were intended to generate.

You Know How the Assistance Reached the Patient

If you worked on drug pricing, foundation funding, patient support or physician payments, speak with our whistleblower experts about how the copays were covered. We build the case with you and bring in pharmaceutical kickback whistleblower lawyers who understand how assistance funding connects to prescriptions and Medicare payments. We stay beside you as your knowledge of the business becomes the evidence behind the case.