- NJ-based Celgene Corp. has come under fire regarding its relationships with charities and is being investigated for illegal kickbacks.
- The big biotech joins a growing list of companies that have come under fire for their involvement in 'charity schemes,' including Valeant, Gilead, Jazz Pharmaceuticals and Biogen.
- Celgene has been contributing between $50 million and $100 million per year to charities that support patients taking its drugs.
At a list price of $644 per pill, Celgene's blockbuster blood cancer drug, Revlimid (lenalidomide), is too costly for many Medicare patients to afford. Charities are intended to help cusion the blows of high drug prices for patients. Yet, Celgene and other drug makers have been accused of working too closely with those charities in an effort to pad their own pockets.
Federal law prohibits pharmaceutical companies from providing co-pay assistance to Medicare patients, who are responsible for their own co-pays unless they obtain assistance from a not-for-profit organization. The statute stipulates that pharmaceutical companies can contribute to these charities, but cannot influence how the money is spent.
The situation came to light because of a whistleblower lawsuit brought against the company by former sales rep Beverly Brown, according to Bloomberg. Based on deposition reports, Celgene has been contributing between $50 million and $100 million per year to charities,with the report suggesting those contributions have been used to support the sale of Celgene drugs. The company's total contributions have doubled between 2010 and 2014 to reach $1.1 billion.
One challenge that prosecutors face is putting all of the pieces together, partly because of patient confidentiality laws that have left most of the records sealed. However, certain documents have been made available from the Patient Access Network (PAN) Foundation and the Chronic Disease Fund (CDF). The documents assert that Celgene required these charities provide substantial information about their operations, including the number of applicants for co-pay assistance and the total amount of assistance, as well as Celgene's amount available to use as assistance.
For its part, Celgene strenuously denies any wrongdoing related to charity schemes, or illegal kickbacks, noting,'no good deed goes unpunished.'