Biogen agrees $22 million settlement to resolve alleged False Claims Act liability

US biotech major Biogen (Nasdaq: BIIB) has agreed to pay $22 million to resolve claims that it violated the False Claims Act by illegally using charitable foundations as a conduit to pay the co-pays of Medicare patients taking Biogen’s multiple sclerosis drugs, Avonex (interferon beta 1a) and Tysabri (natalizumab), according to the US Justice Department.

While denying wrongdoing, Biogen said it believed its conduct was appropriate but entered into the deal to put the investigation behind it.

When a Medicare beneficiary obtains a prescription drug covered by Medicare, the beneficiary may be required to make a partial payment, which may take the form of a co-payment, coinsurance, or a deductible (collectively “co-pays”). Congress included co-pay requirements in the Medicare program, in part, to serve as a check on health care costs, including the prices that pharmaceutical manufacturers can demand for their drugs.