Regeneron Fraudulently Inflated Medicare Reimbursement On Drug: Feds

TARRYTOWN, N.Y. — The federal government has accused Tarrytown-based Regeneron Pharmaceuticals of fraudulently inflating Medicare reimbursements for one of its drugs.

The U.S. Department of Justice has approved Regeneron’s Medicare reimbursement for Eylea, an anti-vascular drug approved by the Food and Drug Administration to treat conditions such as age-related macular degeneration, a disease that reduces vision typically associated with aging. He said the rates had gone up.

The Department of Justice found that drug companies knowingly submitted false average sales price reports to Medicare and Medicaid Services that excluded certain price concessions, specifically credit card processing fees that Regeneron paid to specialty drug distributors for the benefit of its customers. He said he had submitted it to the center.

According to the complaint, the Justice Department said Regeneron paid these credit card fees so that the distributor could accept credit cards to purchase Eylea while still offering lower cash prices for the drug. , said it was so that Regeneron’s customers, typically retina and eye clinics, could receive it. Credit card benefits for purchases, such as “cash back” and other credit card benefits.

Chief Deputy Attorney General Brian M. Boynton of the Justice Department’s Civil Division said he will not allow drug companies to ignore price reporting requirements to maintain high drug prices.

“The Department is committed to protecting federal health care programs from inappropriate actions by drug companies and others that drive up the costs of the programs at taxpayer expense.”

Daren Kwok, Regeneron’s executive director of product and pipeline communications, said in response to Patch’s investigation that the allegations are without merit.

“This complaint follows a civil investigative request from the U.S. Department of Justice in June 2021, which we previously disclosed, regarding the lawful reimbursement of costs incurred by our specialty distributors. It is a thing,” he said.

“The government’s allegations demonstrate a fundamental misunderstanding of drug price reporting standards,” Kwok said. “Regeneron is fully cooperating with the government’s investigation and intends to vigorously defend itself in court.”

The lawsuit was originally filed under the whistleblower provisions of the False Claims Act. Under the law, private parties would sue on behalf of the United States and receive a portion of the recovery proceeds. This law allows the United States to intervene and take over actions, as in this case. If the defendant is found liable for violating the False Claims Act, the United States may recover three times her loss, plus any applicable penalties.