We always focus on foreign bribery — the FCPA and corporate bribery of foreign officials. It is certainly a problem that undermines economic development and human rights.
However, bribery and corruption is real and significant in the United States, from local to state to federal government officials, the news is filled with instances of bribery and corruption. Wherever there is money flowing, there is sure to be fraud and corruption. Even outside government institutions, various industries suffer from bribery and corruption — particularly the drug industry and their interactions and relationships with physicians.
A drug company (like medical device companies) can sink or swim depending on the support they get from physicians — whether the doctors will write prescriptions for their patients. As a result, here is a profound grasp of the obvious — drug companies face high-risk when dealing with doctors.
In a recent announcement, DOJ announced two resolutions on an ongoing investigation focused on Avanir Pharmaceuticals and its neurological drug, Nuedexta. Specifically, Dr. Deepak Raheja, a neurologist, and Frank Mazzucco, a company sales representative, pleaded guilty on the eve of their trial to a scheme to bribe doctors to prescribe Nuedexta. Both defendants admitted to a bribery scheme in which Mazzucco arranged to pay bribes to Dr. Raheja and other doctors to write more prescriptions for Nuedexta, even for patients who did not suffer from the condition the drug treated.
Between 2011 and 2016, Avanir paid Raheja around $331,000 in bribes in exchange for 10,088 prescriptions of Nuedexta (the highest in the United States). In addition to paying Raheja, Mazzucco arranged with an employee to incentivize other physicians to increase the number of prescriptions.
Nuedexta is used to treat pseudobular, a condition that causes involuntary and frequent crying and laughing fits, and is often associated with patients who suffer strokes.
As part of the plea deals, Raheja agreed to serve 2.5 years in prison, surrender his license and pay a fine up to $300,000 and $1.18 million in restitution. Mazzucco agreed to serve between 15 to 21 months and payment of $488,000 in restitution.
These last two deals, however, is the end of a long and tortured prosecution of corruption that permeated Avanir’s Nuedexta over the last three years.
Raheja joined the speaker’s bureau in 2011 and gave 211 presentations during a five-year period. He was paid $1500 for each presentation.
In 2019, two sales representatives, Gregory Hayslette and Dr. Bhupinder Sawhny, plead guilty after being charged in the same indictment with Mazzucco and Raheja. In addition, Raheja falsely diagnosed patients with the condition and documented false symptoms in patient records to support such a false diagnosis.
Mazzucco helped to arrange the speaker bureau program, many of which had little to no educational value or purpose. Each program included an expensive dinner for attendees.
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