The U.S. Department of Health and Human Services, Office of Inspector General (OIG) posted a partially favorable Advisory Opinion (24-05) permitting a biotechnology company (“Company”) to provide transportation, lodging, and payment of associated expenses (“Travel Program”) for certain patients receiving gene therapy treatments for two severe genetic diseases. In the same Advisory Opinion, however, OIG responded unfavorably to the Company’s proposal to subsidize some or all costs related to fertility preservation and storage procedures for these same patients. One day later, OIG posted a separate, unfavorable Advisory Opinion (24-06) to a pharmaceutical manufacturer’s (“Manufacturer”) proposal to subsidize fertility programs for patients receiving gene therapy treatments (“Fertility Programs”).
- Travel Program
The Travel and Fertility Programs implicate the Federal Anti-Kickback Statute (AKS) and the Beneficiary Inducements Civil Money Penalty (CMP). OIG determined that it would not impose sanctions under these authorities for the Travel Program because it has appropriate AKS safeguards and is unlikely to influence patients to use the Company’s gene therapy treatment or to select a particular treatment center for care. This is because –
- A limited number of medical facilities are eligible to become qualified treatment centers. The Travel Program removes a barrier to accessing medically necessary care and allows patients to receive potentially curative treatment that they would be unable to afford.
- The Travel Program increases patient safety and facilitates drug label instructions for the patient to remain at the treatment center for up to two months after receiving the treatment to monitor them for potential complications.
- Company’s treatment is a one-time potentially curative treatment, which reduces the likelihood that it would lead to additional referrals or increased costs to the Federal health care programs in the future.
- The Travel Program does not pay for any expenses covered by the treatment center, insurance, or third- party assistance programs.
Moreover, Company certified that it: does not require physicians or treatment centers to prescribe or use its gene therapy treatment exclusively; would share information about patient support resources, but would not advertise or market the availability of the Travel Program; and would perform a benefits investigation as part of its patient eligibility screening process to avoid providing duplicate support.
- Fertility Programs
Infertility is a potential side effect these gene therapy treatment regimens. Company and Manufacturer proposed providing up to $22,500 or $70,000, respectively, to cover costs associated with fertility preservation and storage procedures to assist certain eligible patients who may otherwise decline treatment because of this potential side effect. OIG determined that both Fertility Programs generate prohibited remuneration or influence patients to select a particular provider or treatment center. No safe harbor or exception protects the Fertility Programs.
Interestingly, OIG based its unfavorable opinions on its perceived lack of information about the fraud and abuse risks arising from the Fertility Programs, including those related to access to health care services, costs to Federal health care programs, patient outcomes, competition, and improper steering. OIG further noted that there was insufficient information about whether the Fertility Programs improved patient access to the gene therapy treatments. In a surprise twist, OIG creatively observed that the Fertility Programs would enjoy safe harbor protection if they were part of CMS-sponsored model arrangements and patient incentives. OIG’s willingness to reexamine these types of fertility programs as relevant data becomes available is especially notable, as it its reminder that unfavorable Advisory Opinions do not reflect an AKS violation per se because the opinions contain no assessment of intent. Therefore, OIG emphasized that unfavorable opinions do not prohibit parties from carrying out proposed arrangements or programs.
While OIG tends to look favorably upon patient assistance programs, provided that they have appropriate safeguards in place, entities considering such programs should proceed carefully to avoid running afoul of the AKS and CMP.
Complete copies of Advisory Opinions 24-05 and 24-06 are available at:
https://oig.hhs.gov/documents/advisory-opinions/9936/AO-24-05.pdf
https://oig.hhs.gov/documents/advisory-opinions/9940/AO-24-06.pdf
Should you have any questions regarding the above, or would like to seek your own advisory opinion, please contact the authors, the Garfunkel Wild attorney with whom you regularly work, or email us at [email protected].