Feds say Astellas, Amgen will fork over $125M to settle charity kickback probes

Astellas agreed to pay $100 million to resolve allegations its charity contributions were actually kickbacks. (Astellas)

The Justice Department has swept pharma companies large and small into an investigation examining the ties between drugmakers and patient charities, and now two more—Astellas and Amgen—have inked settlements totaling $125 million. 

Federal prosecutors claimed the companies used charity contributions as kickbacks to help Medicare patients cover the copays for specific medicines. It’s illegal for companies to earmark charity donations for specific drugs, but the Justice Department said that’s just what they did.  

Under the deals, Astellas will pay $100 million and Amgen $24.75 million to resolve the allegations. The companies denied wrongdoing.

"Amgen does not agree with the government’s view of the relevant facts or that its conduct was inappropriate; accordingly, the settlement does not contain or constitute an admission of liability," a spokeswoman said. The deal "reflects Amgen’s desire to put this legal matter behind it and focus on the needs of patients," she added.

In a statement, Astellas said its "donations were conducted with the understanding that our actions were lawful and appropriate."

"We are pleased to resolve this matter and remain focused on pursuing our mission of turning innovative science into value for patients around the world," the company said.

According to prosecutors, Astellas boosted sales of Xtandi, an androgen receptor inhibitor (ARI) that treats prostate cancer, by asking patient foundations to create copay funds specifically for the ARI category. There are no other ARIs among major prostate cancer meds, the feds said.

In July 2013, Astellas convinced two foundations to open ARI-specific copay funds, the feds said, and Astellas became the only donor to those funds. To increase prescriptions for Xtandi, Astellas then promoted those funds and their copay coverage to doctors, the DOJ said.

As for Amgen, the government claims it stopped donating in 2011 to a fund that supported patients taking any secondary hyperparathyroidism drug, including its own Sensipar. Then, the company worked with another patient foundation to create a fund that would only cover copays for patients using Sensipar.  

The company paid more to the foundation than it would have cost to provide free Sensipar to needy patients, the DOJ alleged. Instead, by using the foundation, the company padded its top line with revenue from Medicare patients, the government said.

The Amgen allegations didn’t end there. The feds said Kyprolis maker Onyx Pharmaceuticals, which Amgen bought in 2013 for $10.4 billion, donated to a fund that ostensibly paid for all multiple myeloma patients’ expenses when they traveled to healthcare facilities for treatment. But the fund only paid for Kyprolis patients’ costs, the feds say. Amgen kept making the payments after integrating Onyx into its operations, according to the allegations.  

These are the latest in a string of settlements stemming from a yearslong probe of pharma’s charity contributions. Earlier this month, the Justice Department struck deals with Jazz, Lundbeck and Alexion totaling $122 million to settle similar allegations. 

Before that, Pfizer last May agreed to pay $23.8 million to resolve its own probe, while United Therapeutics inked a $210 million deal in late 2017. 

Editor's note: This story was updated with a statement from Astellas.