PillPack, LLC, which is a wholly-owned subsidiary of Amazon.com, Inc., will pay $5.79 million to settle a lawsuit that it improperly billed “Government healthcare programs (“GHPs”), including Medicare and Medicaid, for more insulin pens than patients needed according to their prescriptions.” According to the U.S. Department of Justice press release, the settlement also resolves allegations that PillPack “falsely under-reported the days-of-supply of insulin dispensed.”
The press release explains that insulin pens are usually distributed by manufacturers “in five-pen cartons with each pen containing 300 units (3 mL) of insulin solution.” PillPack was required to report data when seeking reimbursement from GHPs: this information included “the quantity dispensed and the days-of-supply.” “Quantity dispensed” means “the amount of medication being dispensed to a patient when the pharmacy fills the prescription,” and “days-of-supply” means the “number of days that the dispensed medication should last” if the patient uses it in accordance with the directions. The press release further explains that “GHPs impose dispensing limits for prescription drugs, including insulin pens, in terms of quantity and days-of-supply and will deny a claim if the reported days-of-supply exceeds those limits, unless an override is obtained.”
According to the government, from April 2014 through November 2019, PillPack allegedly engaged in a practice in which it would “dispense insulin pens to patients using full cartons,” “dispense and bill for the full carton, and falsely under report the days-of-supply to make it appear that the dispensing did not violate the program’s days-of-supply limit.”
This practice, the government’s complaint alleged, “also led PillPack to dispense premature refills to program beneficiaries.” Thus, “PillPack pharmacists frequently dispensed insulin pen refills days or weeks before patients actually needed them according to their prescriptions.”
PillPack will pay “$5,616,136.85 to the United States” and will pay $175,522.55 to state governments separately, “for a total of $5,791,659.40.” PillPack made several admissions under the settlement, including the fact that it falsely reported days-of-supply data to GHPs.
“In connection with the filing of the lawsuit and settlement, the Government joined a private whistleblower lawsuit that had previously been filed under seal pursuant to the False Claims Act,” the press release reports.
In Fiscal Year 2021, whistleblowers helped the U.S. Department of Justice (DOJ) recover $1.6 billion in settlements. The DOJ highlighted health care fraud as “the leading source of the department’s False Claims Act settlements and judgments.”