What was the Novartis copay charity case?
Novartis allegedly paid $51.25 million through three foundations to cover Medicare copays for its MS drug Gilenya and cancer drug Afinitor — shielding patients from its own price increases while Medicare paid the remainder.
On the same day as the speaker-programme settlement, Novartis agreed to pay $51.25 million to the US Attorney in Massachusetts to resolve allegations that it illegally paid, through three foundations, the copays of Medicare patients taking its multiple sclerosis drug Gilenya and its cancer drug Afinitor. Federal law bars manufacturers from covering Medicare copays for their own products, because copays are intended to create price sensitivity.
By funding foundations that in practice paid only for Novartis drugs, the government alleged, the company shielded patients from the cost of its price increases while Medicare paid the remainder. Novartis acknowledged using the foundations between 2010 and 2014. The case was one of a series: Biogen, Teva and Mallinckrodt have faced similar allegations.