Jazz Pharmaceuticals Discloses DOJ Subpoena

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May 11 — The Justice Department is requesting documents about Jazz Pharmaceuticals' support of charitable organizations providing assistance to Medicare patients, the Dublin-based company said May 10.

In a filing with the Securities and Exchange Commission, Jazz revealed it received a documents subpoena from the U.S. Attorney’s Office for the District of Massachusetts in May.

The subpoena also seeks documents related to Jazz's provision of financial assistance to Medicare patients using Jazz's narcolepsy drug Xyrem (sodium oxybate), the company's top-selling product.

Jazz said it intends to cooperate with the subpoena. It also said it's possible that the company could “incur significant costs in connection with the investigation, regardless of the outcome.”

The subpoena is a sign of the government's increasing interest in drug pricing, including scrutiny of drug companies' financial assistance programs, which help Medicare patients pay for their drugs. Patient assistance programs have been criticized for steering patients to use more expensive brand products over less costly alternatives.

In Jazz's case, its patient assistance programs include a free product voucher program for Xyrem and copayment coupon programs for Xyrem and certain other products. Jazz also makes grants to independent charitable foundations that help financially needy patients with their premium, copayment and coinsurance obligations.

Other Companies Received Subpoenas

Jazz said other pharmaceutical companies have disclosed receiving similar inquiries from the government.

For example, in 2015, Valeant Pharmaceuticals International Inc. received similar subpoenas from the U.S. attorneys in Massachusetts and the Southern District of New York, seeking information on its patient assistance programs, drug distribution and pricing decisions (13 PLIR 1497, 10/16/15).

Jazz said the Department of Health and Human Services Office of the Inspector General has refined existing guidance on manufacturer grants to independent charitable foundations providing financial assistance to needy patients. That guidance, a bulletin issued in May 2014, updated a 2005 guidance. The OIG also has issued new or revised advisory opinions on how the government views such programs, the drug manufacturer noted (14 PLIR 16, 1/1/16).

Meanwhile, drugmakers Merck & Co., Johnson & Johnson, and Endo International Plc received government subpoenas this month seeking information about another topic: their contracts with pharmacy benefit managers related to specific drugs (see related item). Those subpoenas came from the U.S. Attorney’s Office for the Southern District of New York.

To contact the reporter on this story: Dana A. Elfin in Washington at delfin@bna.com

To contact the editor responsible for this story: Brian Broderick at bbroderick@bna.com

For More Information

Jazz's SEC filing is at http://src.bna.com/eSZ.