Pharmaceutical Kickbacks Through EHR Vendors: The Drugmaker Paid the Software Company

Electronic health record opioid kickbacks put a drugmaker’s money behind the prescribing advice on a doctor’s screen. The Justice Department alleged that Purdue Pharma paid Practice Fusion, an electronic health records vendor, to induce opioid prescriptions through clinical decision support alerts. The vendor later agreed to a civil settlement covering prescribing and software-certification allegations. If you worked on the sponsorship, the payment or the clinical product, you may know how a commercial agreement reached the recommendation a doctor saw.

What Purdue Was Paying For

The manufacturer paid the electronic health record vendor to influence opioid recommendations, according to the government’s civil allegations against Purdue. The alleged arrangement concerned referrals, recommendations and orders for OxyContin, Butrans and Hysingla, Purdue’s extended-release opioid products. The paid party was the software company. A tool meant to help the doctor choose treatment became a way for the drugmaker to influence that choice. Patients and the taxpayers paying for their care had a stake in whose interests the recommendation served.

The Justice Department’s October 2020 civil settlement announcement placed the Practice Fusion payments beside two other alleged routes to opioid prescriptions. Purdue allegedly paid doctors under the cover of educational talks and consulting, and contracted with specialty pharmacies to fill prescriptions other pharmacies had rejected. The software payment belonged to the same commercial effort to get drugs prescribed and dispensed.

For someone inside the business, the payment’s purpose is the useful starting point. What did the manufacturer expect the vendor to recommend, and what did the vendor agree to deliver? The agreement and the communications about the work can connect the commercial expectation to the clinical product.

Why an Electronic Health Record Vendor Is a Different Paid Party

An electronic health record vendor can carry a manufacturer’s influence into the software a prescriber uses at the point of care. In the Practice Fusion case, clinical decision support alerts made the software itself the channel for prescribing influence.

The drug business already separates the movement of products from the movement of money. Medicines pass from manufacturers through wholesalers to dispensers, while payments and commercial agreements connect participants along different paths. A manufacturer-to-software payment adds another relationship to examine: the company receiving the money supplies a recommendation channel.

For a vendor insider, that makes the commercial and clinical sides of a sponsored feature worth reading together. What did the sponsor ask for? What did the product team understand it was delivering? How did the promised work relate to prescribing? We examine those questions with the people who saw the arrangement take shape.

The practical distinction is the paid party’s role. In a speaker arrangement, the payment can reach the doctor who prescribes. In the electronic health record arrangement alleged against Purdue, it reached the company behind the software. Following only payments to physicians would miss that relationship.

The Practice Fusion Civil Settlement Covered More Than Prescribing

Practice Fusion’s civil settlement covered prescribing-related allegations and separate allegations involving electronic health record certification and incentive payments. The Justice Department announced approximately $118.6 million in civil settlements on January 27, 2020.

The Insider Trail Runs From the Payment to the Recommendation

The useful evidence connects the manufacturer, the vendor, the promised work and the prescribing recommendation. A person who understands that connection can explain why a payment was made and how the vendor was expected to earn it.

For someone in finance or commercial operations, the starting material may be an agreement, an invoice or correspondence about what the sponsor was buying. We compare the stated purpose with the work the vendor agreed to deliver. The important question is what the payment was intended to change in the prescribing process.

For someone on the software or clinical team, the relevant knowledge may concern the request that reached the team, the proposed recommendation and the people deciding what to build. Communications linking the sponsor’s request to the delivered feature can explain a relationship that a payment ledger leaves unexplained. A person who participated in those discussions can supply context that the finished screen alone cannot.

The connection to government spending is another part of the inquiry. In the Purdue civil settlement, the government alleged that the company caused false claims to reach federal health care programs, including Medicare and Medicaid. We work with insiders to connect what happened inside the business to the prescriptions and claims involved.

How Do Pharmaceutical Kickbacks Work?

Pharmaceutical kickbacks work by paying someone to steer the choice, recommendation or purchase of a drug. The paid party can influence a different stage of the transaction from the person who ultimately bills a health care program.

Purdue’s civil allegations show why the intermediary matters. The government alleged that educational talks and consulting payments induced doctors to prescribe more OxyContin. It also alleged that Purdue contracted with specialty pharmacies to fill opioid prescriptions that other pharmacies had rejected as potentially medically unnecessary. Each places a commercial payment at a different decision in the same drug’s path to a patient.

That is why the identity of the recipient matters as much as the manufacturer’s name. A vendor employee, a pharmacy employee and a person managing speaker payments may each understand a different way the manufacturer sought more prescriptions. The transaction they saw gives the allegation its substance.

How the Payment Connects to a False Claims Act Case

The Anti-Kickback Statute prohibits knowingly and deliberately paying someone to steer prescriptions covered by federal health care programs. The payment can go directly to the prescriber or through a go-between.

A claim resulting from an Anti-Kickback Statute violation can support a False Claims Act case. A company can cause a false claim even when another business submits the bill. In an electronic health record case, that makes the link between the manufacturer’s payment, the vendor’s role and the resulting claim central to our work with you.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. If you understand what a drugmaker paid your company to do, our whistleblower experts can assess that knowledge with you.

When You Know Who Paid for the Recommendation

If you worked at a software vendor or a drugmaker and know what a sponsorship paid for, speak to one of our whistleblower experts about what the drugmaker bought. We work beside you to build the case around the payment, the product decisions and the government claims, bringing in pharmaceutical kickback whistleblower lawyers who understand the software’s role.