On January 4, 2018, OIG issued a letter to Pharmaceutical Research and Manufacturers of America (PhRMA) addressing OIG’s Final Notice of Rescission of OIG Advisory Opinion No. 06-04 dated November 28, 2017. The OIG’s 2018 letter notified PhRMA that OIG will not pursue administrative sanctions against entities that manufacture, sell, or distribute outpatient prescription drugs  and provide free drugs during 2018 to Federal health care program beneficiaries who were receiving cost sharing support for those drugs  from a charitable patient assistance program, (previously undisclosed, but now publically known to be Caring Voice Coalition, Inc. (CVC)), as long as such companies comply with the safeguards described in OIG’s letter. As previously reported in King & Spalding’s Health Headline here, OIG Advisory Opinion No. 06-04 was initially issued on April 20, 2006 to CVC, a nonprofit, tax-exempt, charitable patient assistance program before it was rescinded on November 28, 2017.

The advisory opinion had previously protected CVC from the imposition of certain administrative sanctions for providing financially needy Medicare beneficiaries financial assistance with premiums and cost-sharing obligations under certain Medicare plans.

OIG based its decision to rescind the advisory opinion on CVC’s failure “to fully, completely, and accurately disclose all relevant and material facts to OIG.”  Specifically, the request for an advisory opinion allegedly did not inform OIG that CVC gave patient-specific data to at least one or more donors. According to OIG, from this data, the donor(s) were able to “correlate the amount and frequency of their donations with the number of subsidized prescriptions or orders for their products.”  Further, this data reportedly “allowed donors to directly or indirectly influence the identification or delineation of [the charity’s] disease categories.”  OIG stated that these breaches were material to its initial determination in the advisory opinion that CVC was independent between donors and patients.

The 2018 letter to PhRMA was, at least in part, prompted by CVC’s announcement that it would not provide patient financial assistance in 2018 and OIG’s recognition that the absence of this support may affect patients’ access to critical drugs.

The 2006 initial OIG Advisory Opinion to CVC is available here. A subsequently modified OIG Advisory Opinion from 2015 is available here, and OIG’s 2017 rescission letter to CVC is available here.