A Medical Device Daily

In a move that appears to indicate the U.S. government’s increased investigations of kickbacks to customers by both medical drug and medical device manufacturers, a federal grand jury last week issued indictments against four sales and marketing executives of Serono Laboratories (Boston).

The indictments charge a conspiracy to provide kickbacks to doctors in the form of expense-paid trips, for the doctors and their guests, to a medical conference in Cannes, France. The payback: writing prescriptions of a drug made and sold by Serono .

The charges were unveiled by officials of the Department of Justice, the FBI, the FDA’s office of Criminal Investigations, the Department of Health and Human Services and several others.

Four defendants – charged with conspiracy and offering to pay illegal remunerations – were responsible for sales and marketing of the drug Serostim, the trade name for the generic drug somatropin, a form of recombinant human growth hormone.

The indictment alleges that Serostim entered the market with the advent of protease inhibitor drugs which, in the U.S., curtailed the proliferation of AIDS when used in an AIDS “cocktail.”

The indictments allege that the defendants concocted a plan to meet sales by identifying the highest-prescribing physicians and providing them expense-paid trips to Cannes in return for writing additional prescriptions of Serostim. The cost induced by the offer was for a 12-week course of treatment valued at around $21,000 each.

If convicted, the defendants each face up to five years’ imprisonment per count, followed by three years of supervised release, and a $250,000 fine per count.