Johnson & Johnson's Actelion unit agrees to pay $360 million to resolve US kickback allegations

Ref: NASDAQ;Financial Times;Yahoo!Finance;US Department of Justice

The US Department of Justice on Thursday announced that Johnson & Johnson's Actelion Pharmaceuticals unit has agreed to pay $360 million to settle claims that it used a charity to funnel kickbacks to Medicare patients. In the case, Actelion was accused of using a charity as a conduit for paying co-pays for patients prescribed its pulmonary arterial hypertension drugs. US Attorney Andrew Lelling stated "such conduct not only violates the anti-kickback statute, it also undermines the Medicare programme's co-pay structure, which Congress created as a safeguard against inflated drug prices."  

Specifically, the Department of Justice contends that from 2014 to 2015, Actelion made payments to a charitable foundation, which in turn used the money to help Medicare patients cover the out-of-pocket costs of drugs including Opsumit (macitentan) and Tracleer (bosentan). Lelling noted that Actelion raised the price of Tracleer by nearly 30-fold the price of inflation over the period covered by the settlement. 

Actelion did not admit wrongdoing under the terms of the agreement. A spokeperson from the company stated “we are committed to full compliance with all laws and regulations in our work ...Today’s agreement resolves the government’s investigation into Actelion’s donations to a patient assistance foundation in 2014 and 2015, before the company was acquired in 2017,”  Actelion was acquired by Johnson & Johnson last year for about $30 billion. 

The settlement amount exceeds the previous record fine of $210 million levied against United Therapeutics last year over allegations of using a charity to pay out-of-pocket expenses of Medicare patients. Subsequently, the Department of Justice has also reached settlements of $57 million with Jazz Pharmaceuticals and of $24 million with Pfizer over similar claims.