Pharmaceutical Company Fined $750K for Paying Kickbacks on Opioid Prescriptions

A California pharmaceutical company has agreed to pay $750,000 to resolve allegations that it violated the False Claims Act by causing the submission of claims for certain opioids in violation of the federal Anti-Kickback Statute, announced US Attorney Philip R. Sellinger.

From Dec. 1, 2015, through Aug. 31, 2016, Sentynl Therapeutics Inc., a specialty pharmaceutical company out of Solana Beach, CA, marketed and sold prescription opioids Abstral and Levorphanol Tartrate (Levorphanol).

“The opioid crisis has had devastating impacts here in New Jersey and for the country at large," said Sellinger. "This office is committed to combatting this crisis at every level of the healthcare system, from the prescribers to the manufacturers. Here, this pharmaceutical company is alleged to have indirectly paid unlawful kickbacks to a doctor by employing his girlfriend in an effort to improperly induce him to prescribe their opioid products. Today’s settlement holds them accountable for this alleged wrongdoing and reflects law enforcement’s ongoing commitment to protecting the integrity of medical decision-making and combatting the opioid crisis.”   

The settlement resolves allegations that, during the relevant time period, Sentynl knowingly caused the submission of claims for Abstral and Levorphanol medications to Medicare in violation of the federal Anti-Kickback Statute. These allegedly false claims resulted from Sentynl’s alleged indirect payment of kickbacks to a physician.

Specifically, the United States contends that Sentynl hired the girlfriend of a physician who was a top prescriber of Transmucosal Immediate Release Fentanyl (TIRF) medications to act as a sales representative in South Florida — the same region in which the physician practiced. Sentynl hired, employed, and made salary and bonus payments to the physician’s girlfriend to induce the physician to prescribe its Abstral and Levorphanol medications.

“Some violations of the Anti-Kickback Statute, like those alleged here, can induce physicians’ imprudent prescribing of controlled substances,” stated Special Agent in Charge Naomi Gruchacz with the US Department of Health and Human Services Office of Inspector General. “Individuals and entities that participate in the federal health care system are required to obey the laws meant to preserve the integrity of program funds and the provision of appropriate, quality services to patients.”

The claims resolved by the settlement are allegations only and there has been no determination of liability.

Sentynl has responded to the allegations:

"Sentynl strongly denies the US Department of Justice allegations. After spending more than five years cooperating with the government investigation, we made the practical decision to resolve the matter with a settlement that includes a nominal payment and no acknowledgment of wrongdoing.

"When we first learned that an employee had a potential conflict of interest — years before the government became involved — we immediately launched an investigation and terminated the employee at the end of the review. We’re confident that the company acted appropriately and are pleased to have this matter fully resolved. We look forward to focusing our full attention on advancing our therapeutics focused on rare disease patients."