Regeneron Pharmaceuticals, Inc. makes the drug Eylea, which is a prescription injection designed to treat wet age-related macular degeneration (wet AMD), an eye disease that can lead to blindness. Eylea is more expensive than the competing drug Avastin, but the complaint for this class action alleges that Regeneron used an illegal scheme involving a purported charity to boost its sales and make it the market leader for wet AMD despite its high prices.
The class for this action is all third-party payers in the US, its territories, and commonwealths who bought, paid for, or provided reimbursement for some or all of the price of Eylea, other than for resale, at any time between January 1, 2012 and the present.
The wholesale list price for Eylea is $1,850 per treatment. Avastin, its competitor, costs only around $55 per treatment. Despite this, Eylea has sold far more treatments than Avastin.
The plaintiff in this case is Medical Mutual of Ohio (MMO), a health insurance company that offers, among other things, Medicare Advantage plans. The complaint alleges, “Since 2012, Regeneron has built Eylea’s market dominance and maintained its exorbitant price through an illegal scheme that directly injured MMO and other healthcare plans.”
How did it work? According to the complaint, Regeneron regularly transferred money to the Chronic Disease Fund (CDF), which the complaint refers to, in quotation marks, as a “charity,” which then provides financial help to patients to pay their out-of-pocket expenses for Eylea.
The complaint alleges, “Pursuant to a secret arrangement between Regeneron and CDF, the funds provided by Regeneron were calculated to cover patients’ out-of-pocket costs for Eylea but not for competing drugs. Regeneron’s arrangement with CDF made Eylea cheaper for patients—but not for the Medicare program or for private healthcare plans—in comparison with alternative drugs.”
In this way, the complaint claims, Regeneron made Eylea seem cheaper to patients while raising costs for Medicare and other health insurance companies. Through this scheme, the complaint claims, “Regeneron could neutralize the incentive systems used by Medicare and private healthcare plans to guide covered patients to lower-cost but equally effective drugs.”
According to the complaint, “Regeneron’s scheme thus violated the federal Anti-Kickback statute, among other laws.”
The complaint claims that the scheme came to light when the Department of Justice (DOJ) filed an action against Regeneron in June 2020. According to the complaint, “evidence revealed by the DOJ Action demonstrates not only Regeneron’s extensive coordination with CDF, but also Regeneron executives’ awareness that this coordination violated federal law, and that wet AMD patients and prescribers opted for Avastin in the absence of Regeneron’s kickback funding.”
MMO brings this suit because it has paid out nearly $40 million to pay for patients’ use of Eylea and thus claims it was injured by the scheme, along with other health insurers.
Article Type: LawsuitTopic: RICO
Most Recent Case Event
Regeneron “Charity” Boosted Sales of More Expensive Drug Complaint
February 23, 2022
Regeneron Pharmaceuticals, Inc. makes the drug Eylea, which is a prescription injection designed to treat wet age-related macular degeneration (wet AMD), an eye disease that can lead to blindness. Eylea is more expensive than the competing drug Avastin, but the complaint for this class action alleges that Regeneron used an illegal scheme involving a purported charity to boost its sales and make it the market leader for wet AMD despite its high prices.
Regeneron “Charity” Boosted Sales of More Expensive Drug ComplaintCase Event History
Regeneron “Charity” Boosted Sales of More Expensive Drug Complaint
February 23, 2022
Regeneron Pharmaceuticals, Inc. makes the drug Eylea, which is a prescription injection designed to treat wet age-related macular degeneration (wet AMD), an eye disease that can lead to blindness. Eylea is more expensive than the competing drug Avastin, but the complaint for this class action alleges that Regeneron used an illegal scheme involving a purported charity to boost its sales and make it the market leader for wet AMD despite its high prices.
Regeneron “Charity” Boosted Sales of More Expensive Drug Complaint