We recently wrote about Shire’s $56.5 million settlement to resolve False Claims Act allegations involving the company’s ADHD drugs Adderall XR and Vyvanse. Shire agreed to a Corporate Integrity Agreement (CIA) with HHS-OIG in exchange for avoiding exclusion from participation in Medicare, Medicaid, or other Federal health care programs.
Shire’s agreement became effective September 15; view it here.
Shire’s CIA has similar requirements and structure to previous agreements, with some noteworthy changes, especially in the physician payment disclosure category. We have compared Shire’s CIA to the Agreements entered into by Endo Pharmaceuticals (2/21/2014), Johnson and Johnson (10/31/2013), and GlaxoSmithKline (6/28/2012).
Changes to the Disclosure Requirements
Long before the Centers for Medicare and Medicaid Services (CMS) published a Final Rule to the Physician Payments Sunshine Act, and before Open Payments launched, companies under CIA were required to post their physician payments to their company websites. ProPublica initially created their “Dollars for Docs” website using this CIA payment information.
Now that all pharmaceutical and device manufacturers must comply with the Federal Sunshine Act, HHS-OIG seems to have changed their requirements for companies under CIA, based on Shire’s agreement.
- No more quarterly reporting of physician payments
In agreements with GSK, J&J, and Endo, HHS-OIG required that these companies create searchable lists of physician payments on their websites on a quarterly basis. Now, that requirement for general physician payments is no longer applicable--Shire must only publish annually. As noted in the next bullet point, however, the OIG still wants quarterly payments of “Independent Medical Education Activity Grants and Health Care Related Charitable Contributions.”
Shire’s CIA states that for each Physician Covered Recipient, the applicable report must include the following information: (i) physician’s full name; (ii) city and state that the physician has provided to Shire for contact purposes; and (iii) the aggregate value of the Payments from August 1, 2013 through December 31, 2013, for the partial 2013 report; or (iv) the aggregate value of the Payment(s) in the preceding calendar year, for each annual report.
- Quarterly reporting now explicitly required for independent medical education activity grants and health care related charitable contributions
We noticed that the OIG didn’t include a reporting category for the “name of any Related Entities” that received payment from Shire as was the case in previous CIAs. Shire’s CIA actually includes a more specific category than in past agreements.
Shire represents that, on a quarterly basis, it posts on its company website the following information with respect to all Independent Medical Education Activity grants and health care related charitable contributions. The information posted on the company website includes: (i) the name of the recipient; (ii) the program name; and (iii) the amount of the grant or donation. Shire shall continue to post (and provide updates to) the above-described information about Independent Medical Education Activity grants and health care related charitable contributions throughout the term of this CIA. Shire shall notify OIG in writing at least 60 days prior to any change in the substance of its policies regarding the funding of Independent Medical Education Activity grants and health care related charitable contributions or posting of the above-referenced information relating to such funding.
Shire defines “Independent Medical Education Activity” as “any professional program, meeting, or event, including but not limited to, continuing medical education (CME) or symposia, conducted by a third party, such as an accredited medical education provider, and supported by Shire to educate individuals such as HCPs about pharmaceutical therapies, disease states, and other topics.”
- CIA’s definition of “payments,” including indirect payments and third party payments, now mirrors the Sunshine Act Final Rule
Regarding Shire’s disclosure obligations under the CIA, the agreement states:
“The term includes all indirect payments or other transfers of value made to a Physician Covered Recipient through a third party where Shire requires, instructs, directs, or otherwise causes the third party to provide the Payment to the Physician Covered Recipient. The term also includes direct and indirect payments or other transfers of value provided to a third party at the request of or designated by the Shire on behalf of a Physician Covered Recipient.”
Previous CIAs states have not included this bolded language.
- CIA now links the definition of reportable “payments” to Open Payments FAQs
Previous agreements have used the Sunshine Act and the Final Rule to define “payments” for purposes of reporting. However, Shire’s is the first we have seen to explicitly state: “Payments” is defined to include all “direct or indirect payments or other transfers of value” as that term is defined in 42 U.S.C. § 1320a-7h and applicable regulations and guidance (including FAQs) published by CMS.
- OIG is not requiring Shire to send letters to all detailed HCPs and HCIs about their settlement and alleged misconduct
CIAs we reviewed all contained a version of the following requirement (this example is Endo's):
Within 120 days after the Effective Date, Endo shall send, by first class mail, postage prepaid with delivery confirmation, a notice containing the language set forth below to all HCPs and HCIs who are currently detailed on behalf of Endo. This notice shall be dated and shall be signed by Endo’s Chief Executive Officer. The body of the letter shall state the following:
"As you may be aware, Endo Pharmaceuticals Inc. recently entered into a
global civil, criminal, and administrative settlement with the United States
and individual states in connection with the promotion of one of its
products (Lidoderm). This letter provides you with additional information
about the settlement, explains the commitments of Endo going forward, and
provides you with access to information about those commitments."
"In general terms, the Government alleged that Endo unlawfully promoted its product Lidoderm for intended uses not approved by the Food & Drug Administration (FDA) and that these activities violated the Federal Food, Drug, and Cosmetic Act and the False Claims Act. To resolve these matters, an Endo subsidiary, Endo Pharmaceuticals, Inc. (EPI) has entered into a deferred prosecution agreement and agreed to pay approximately$20.8 million as a monetary penalty and forfeiture. In addition, Endo entered into a civil settlement and agreed to pay $172.9 million to the Federal Government and State Medicaid programs to resolve False Claims Act allegations."
Interestingly, this disclosure requirement is absent from Shire's CIA.
Elsewhere, Shire's CIA does not deviate far from the past few big pharmaceutical settlement agreements. The updates to the disclosure portions of Shire's CIA, however, seem to signal that the OIG is attempting to align itself with CMS' Final Rule. While the CIA captures the same definitions as the Sunshine Act, OIG still asks less of companies in terms of reporting details on their website. Only the total aggregate payment is required for each physician, for example.
Shire's CIA requirement to report quarterly on independent CME likely indicates that OIG wants to see where Shire is spending its education funds--spend that is currently exempt from the Sunshine Act if the educational program is accredited and meets stringent "independence" requirements. Hundreds of organizations believe the Final Rule should continue exempt such payments from reporting.
We have also written a five-page outline of Shire's 78-page Corporate Integrity Agreement. Understand that more specifics are found in the actual agreement.
For specific information regarding Shire's obligations under the settlement agreement, view the full CIA document here.