Bristol Myers Squibb: An Abilify Sales Force Aimed at Nursing Homes

In the Bristol Myers Squibb Abilify nursing homes fraud case, Bristol-Myers Squibb Company and its subsidiary Apothecon agreed to pay more than $515 million in a wider drug-marketing and pricing settlement. The government alleged that the company promoted Abilify for dementia-related psychosis through a sales force calling almost exclusively on nursing homes. The settlement resolved allegations brought in seven whistleblower cases.

The Justice Department announced the civil settlement on September 28, 2007. The package brought together off-label promotion, manufacturer payments intended to influence drug purchases and false pricing allegations.

Abilify Promotion in Nursing Homes

The government alleged that Bristol-Myers Squibb promoted Abilify for pediatric use and dementia-related psychosis from 2002 through the end of 2005. Abilify was an atypical antipsychotic. In its account of the case, the Justice Department described its approved uses as adult schizophrenia and bipolar disorder, while the pediatric and geriatric dementia-related uses at issue lacked Food and Drug Administration approval.

The release also described a required black-box warning concerning Abilify’s use for dementia-related psychosis. The government alleged that Bristol-Myers Squibb created a specialized long-term-care sales force that called almost exclusively on nursing homes, where dementia-related psychosis was far more prevalent than schizophrenia or bipolar disorder.

The warning concerned the very use the government accused the company of promoting to nursing-home prescribers. The commercial decisions worth examining begin with which facilities the company targeted and what it told the people prescribing there.

The pediatric allegations involved a separate audience within the same Abilify campaign. According to the government, the company directed sales representatives to child psychiatrists and other pediatric specialists, then urged providers to prescribe Abilify to pediatric patients.

The Other Drug Marketing and Pricing Allegations

The wider settlement covered alleged payments to prescribers and drug purchasers, inflated reimbursement prices and Medicaid best-price reporting.

For Bristol-Myers Squibb, the government alleged that consulting fees and expenses induced physicians and other providers to buy its drugs. The payments ran through consulting programs and advisory boards, with some programs involving travel to luxury resorts. The government’s point was what those payments bought: influence over drug purchases that generated claims to federal health care programs.

Apothecon allegedly paid retail pharmacies and wholesalers to buy its drugs. The government alleged that both companies’ payments caused false claims to federal programs.

The pricing allegations concerned oncology and generic drugs. The companies allegedly reported prices substantially above those commonly available to customers, knowing that federal programs used the reported figures to set reimbursement. A provider could buy at the lower price and receive reimbursement based on the higher one. The larger the gap, the larger the provider’s return, with taxpayers funding the difference.

For the antidepressant Serzone, the government alleged that Bristol-Myers Squibb left low prices charged to Kaiser for private-label products out of its Medicaid best-price reports. Those reports were supposed to include the lowest price charged to commercial customers. The alleged omission denied Medicaid and certain Public Health Service entities the benefit of that price.

The Whistleblower Cases Behind the Settlement

The Justice Department announced that the whistleblowers behind the False Claims Act qui tam cases would receive approximately $50 million collectively as their share of the settlement.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

The Justice Department announced a separate settlement of more than $4 million with Otsuka American Pharmaceutical in March 2008. It resolved remaining Abilify promotion allegations after the Bristol-Myers Squibb settlement, including pediatric and dementia-related uses and a nursing-home sales force.

What Evidence Is Needed to Prove Fraud?

For a nursing-home drug-promotion case, the useful evidence connects the company’s sales decisions to prescribing and the government-paid care. Our whistleblower experts work with the insider to connect those parts of the story.

Sales call plans and promotional materials can show who chose the nursing-home audience and what representatives were told to promote. Our experts connect that message to the prescribing decisions and the clinical and billing records that explain the care and payment.

Under Medicare’s skilled nursing facility billing framework, the Part A facility payment generally includes drugs, and the facility’s contract determines what it pays an outside supplier. We trace the resident’s coverage and the billing path with you, connecting the prescription to the government payment.

When the Sales Target Reaches the Medication Review

A separate complaint involving Omnicare and Amgen’s Aranesp arrangements illustrates how a commercial incentive can reach the nursing home. The whistleblower alleged that the companies used consultant pharmacists’ medication reviews to encourage drug switches. The complaint described the facilities’ reaction:

In that account, the pharmacy’s rebate target reached the physician as a request to change medication. It shows why the person receiving a sales pitch or a switching request may understand something the payment data alone cannot explain.

The Payments and the Corporate Integrity Agreement

The announced federal recovery exceeded $328 million, alongside more than $187 million for participating Medicaid states. Within the federal amount, more than $25 million represented Abilify profits to be surrendered under the Food, Drug and Cosmetic Act. That Abilify component covered both pediatric and dementia-related promotion within the broader marketing and pricing settlement.

Bristol-Myers Squibb also entered a Corporate Integrity Agreement with the Department of Health and Human Services Office of Inspector General. The Justice Department said it required accurate average sales prices and average manufacturer prices for drugs covered by Medicare and other federal healthcare programs.

You Know Where the Sales Message Went

If your work in sales, pharmacy, clinical care or compliance showed how a drug campaign reached nursing-home prescribing, talk with our whistleblower experts about what you saw. We develop the case with you and bring in pharmaceutical fraud whistleblower lawyers who understand the connection between manufacturer promotion and government-paid prescriptions. We stay beside you as your knowledge of the business becomes the foundation of the case.