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Does Offering Free Access to Drug Pricing Tool Cross the Kickback Line?

NY federal court ruling sheds light on what constitutes “remuneration” banned by the Anti-Kickback Statute.

The Anti-Kickback Statute (AKS) bans providing or offering “remuneration” to induce referrals. Did a medical supply company cross that line by offering oncology practice clients free access to a Margin Analyzer enabling them to compare reimbursement rates of “therapeutically interchangeable” drugs and receive recommendations based on that data? A former business development executive filed a qui tam whistleblower lawsuit against the supplier claiming that the company violated the AKS. The company denied that offering free access to the tool was remuneration and asked the New York federal court to toss the claim without a trial.

The court refused, finding that there was enough evidence supporting the claim’s plausibility to survive the summary judgment motion. Result: The whistleblower could take his claim to trial, provided that he fix certain technical legal deficiencies in his pleadings.

Takeaway: Courts have consistently interpreted “remuneration” under the AKS expansively as encompassing just about anything of value. The whistleblower in this case was able to turn the tables on the supplier by using its own marketing materials promoting just how valuable the Margin Analyzer was to oncology practices. In addition, the tool offered “independent” value and wasn’t tied to the services the company was already providing clients. Both sides would get a shot at the “remuneration” question at trial. But at this point, the issue wasn’t clear cut enough to warrant dismissal.

[United States v. McKesson Corp., 2022 U.S. Dist. LEXIS 81875]

Learn more on recent cases involving the health care industry in Lab Compliance Advisor.