Pharmaceutical drugs sales, qui tam lawsuits
  and the False Claims Act -- Part I

Kickbacks to doctors from pharmaceutical companies
Payments to doctors for prescribing or switching drugs, attending promotional events, or as rewards for high volume are essentially kickbacks, which could be the basis for a whistleblower to bring a qui tam lawsuit under the False Claims Act.

In addition, pharmaceutical companies have used schemes to make it financially advantageous for doctors to prescribe their drugs, which may make the drug companies liable under the False Claims Act.  Pharmaceutical companies have offered doctors “research” or “educational grants” that are inducements to prescribe their drugs.  Pharmaceutical companies also have encouraged or advised doctors and other healthcare providers to seek “reimbursement” from Medicare and Medicaid for free samples of drugs as a way for the doctors and healthcare providers to increase profits

Drug companies also have provided kickbacks by “marketing the spread” between an artificially high average wholesale price used by Medicare and others to determine reimbursement of the cost of the drug, and the deeply discounted prices paid by providers for the drug (“the discounted price”). The difference between the average wholesale price and the discounted price to physicians – known as the “spread” - is pure profit to the physician’s practice. But those profits unfairly cost Medicare and other government programs millions.  While Medicare does not pay for most drugs needed by Medicare beneficiaries, Medicare does cover drugs that must be injected under the supervision of a physician, such as oncology drugs.

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