Eyepoint Pharmaceuticals, Inc., (EyePoint) headquartered in Massachusetts, has agreed to pay the United States $ 4,657,463.18 to resolve allegations that it violated the False Claims Act by paying kickbacks to certain Ambulatory Service Centers (ASCs) to induce those ASCs to purchase and dispense DEXYCU, an injectable drug approved for the treatment of ocular inflammation following cataract surgery, between January 1, 2019 and March 1, 2023.
The United States alleges that following the commercial launch of DEXYCU in 2019, EyePoint induced ASCs to purchase and dispense DEXYCU by implementing an Assurance Program --- whereunder EyePoint would reimburse or compensate ASCs if health insurers denied a claim for DEXYCU or reimbursed DEXYCU below the ASCs’ purchase cost --- and by offering excessive free samples of DEXYCU to ASCs.
“Kickbacks by pharmaceutical companies increase the cost of drugs used by patients and paid for by federal health care programs,” said Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division. “The Civil Division will hold accountable anyone who pays unlawful kickbacks.”
“As we have for years, our Office will continue to hold pharmaceutical manufacturers accountable for paying illegal kickbacks,” said United States Attorney Leah B. Foley. “Through these efforts, we protect patients by removing providers’ financial incentives to prescribe or dispense products that may not be medically necessary for the patient and protect the public from fraud, waste and abuse.”
“Pharmaceutical companies that attempt to boost profits through unlawful kickbacks undermine the integrity of federal health care programs and betray the patients who rely on them,” said Acting Deputy Inspector General for Investigations Scott J. Lampert of the U.S. Department of Health and Human Services Office of Inspector General (HHS OIG). We will aggressively pursue any entity that seeks to corrupt medical decision making and will not hesitate to hold them accountable.”
In connection with the settlement, EyePoint entered into a five-year Corporate Integrity Agreement (CIA) with the U.S. Department of Health and Human Services Office of Inspector General. Through separate agreements, Eyepoint will pay an additional $21,518.68 to certain participating states.
The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by AFCE LLC. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. The qui tam case is captioned U.S. ex rel. AFCE LLC, et al., v. EyePoint Pharmaceuticals, Inc., No. 21-CV-12071 (D. Mass.) Under the resolution, the Relator will receive $791,768.74 from the settlement.
The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, the United States Attorney’s Office for the District of Massachusetts, the Federal Bureau of Investigation and the U.S. Department of Health and Human Services Office of Inspector General.
The investigation and resolution of this matter illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement, can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
This year the Administration launched the Task Force to Eliminate Fraud and the National Fraud Enforcement Division to enhance the Administration’s war on fraud, waste, and abuse in federal programs. When unscrupulous actors exploit these programs for their own financial gain, they defraud the government, harm the people these programs are designed to aid and protect, and undermine American businesses that play by the rules. The Civil Division’s FCA enforcement plays a critical role in combatting such fraudulent schemes, recovering billions of dollars for the American taxpayers, and holding wrongdoers accountable. FCA matters will continue to be on the forefront of the battle against fraud, and the Civil Division’s FCA work will support and advance the mission of the Task Force to Eliminate Fraud and the National Fraud Enforcement Division.
The investigation and resolution of this matter was handled by Fraud Section Trial Attorney Margaret F. Thomas and Assistant U.S. Attorney Steven T. Sharobem.
The claims resolved by the settlement are allegations only and there has been no determination of liability.
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