Software firm negotiates $145 million settlement in opioid-kickback scheme that’s been called “completely insane”
02/12/2020 // JD Heyes // Views

Earlier in January, Americans who have lost loved ones and friends to opioid overdoses and other related deaths were happy to see a judge sentence the founder of drugmaker Insys to more than five years in federal prison for a scheme to effectively bribe doctors into prescribing more of Subsys, an opioid painkiller made for patients with advanced-stage cancers who had developed a high opioid tolerance.

The company claimed that its drug was far less addictive than other opioid-based painkillers and as such encouraged doctors to prescribe it “off-label,” or for conditions other than what it was originally intended for.

“The company's aggressive sales team included a former stripper who specialized in showing doctors who heavily prescribed the drug a good time,” Zero Hedge reported.

Just days ago, the Justice Department announced a new action tied to its efforts to hold those responsible for the opioid epidemic accountable. The DoJ noted in a press release it had reached a $145 million settlement with a firm called Practice Fusion, a San Francisco-based developer of information technology products for the healthcare industry. 

Company officials agreed to the terms of the payment in order to end civil and criminal investigations into whether the firm had engaged in soliciting kickbacks from “a major opioid manufacturer” in exchange for the use of its IT in order to push doctors towards prescribing more opioids unnecessarily. Of the settlement, $26 million went to criminal fines while about $118.6 million will go into the coffers of the federal government and states.


Primary care providers relied on Practice Fusion’s technology in order to make decisions about which drugs to prescribe to patients. Prosecutors said such a practice was not just immoral but also patently illegal, as it violated anti-kickback statutes.

“Across the country, physicians rely on electronic health records software to provide vital patient data and unbiased medical information during critical encounters with patients," said Principal Deputy Assistant Attorney General Ethan Davis of the Department of Justice’s Civil Division. 

"Kickbacks from drug companies to software vendors that are designed to improperly influence the physician-patient relationship are unacceptable,” Davis continued. “When a software vendor claims to be providing unbiased medical information – especially information relating to the prescription of opioids – we expect honesty and candor to the physicians making treatment decisions based on that information.” (Related: Opioid epidemic reaches whole new crisis level as Big Pharma drugs out America for profit.)

“Completely insane” 

Practice Fusion entered into the deferred agreement with the U.S. Attorney’s office in Vermont.

In exchange for a “sponsorship” payment from a pharmaceutical company of almost $1 million, the firm allowed other companies to guide the development and implementation of CDS alerts in its EHR software.

The “pain” alerts, as they’re known, would then alert physicians to prescribe additional opioids according to Practice Fusion executives, thereby advising opioid makers it would assist in boosting their sales.

In exchange for the million-dollar payment, the firm then allowed opioid manufacturers to include “input” into the development of the company’s CDS alerts. 

“In an extra-cruel twist, payments were financed by the unnamed opioid maker’s marketing department,” Zero Hedge added.

A healthcare reporter for BBG described the scheme as “completely insane.”

Most attorneys general in the states along with the Trump administration have been pursuing legal remedies and criminal actions against opioid makers as the American public demanded action amid a rising epidemic of deaths. 

Several of the drug makers, including Purdue, have declared bankruptcy in order to escape having to pay massive civil liability claims. Many of the marketing efforts used by the Big Pharma companies were dishonest schemes aimed not at protecting the public by rather by exploiting those most in need of painkilling medications.

President Trump has made fighting the opioid epidemic a priority. Earlier in January, the White House announced that for the first time since 1990, opioid deaths actually fell last year, dropping by five percent.

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