One of the largest patient assistance charities in the US may shut down amid government allegations that it helped drug companies raise prescription prices.
In a letter to the organization, the federal government revoked Caring Voice Coalition’s authorization on Tuesday.
The Department of Health and Human Services Office of the Inspector General’s letter cited findings that the group, mainly funded by pharmaceutical companies, enabled drug-makers to influence prescriptions.
Caring Voice may have given pharmaceutical companies ‘greater ability to raise the prices of their drugs while insulating patients from the immediate out-of-pocket effects of price increases,’ leaving the government to cover them instead, the letter says.
The US federal government has revoked its authorization of Caring Voice Coalition, a major patient assistance charity that, the Department of Health and Human Services alleges, has helped its pharmaceutical company donors raise drug prices at the government’s expense
Caring Voice provides financial assistance to patients suffering form chronic illnesses. It works with people insured privately and through Medicare.
Drug companies are not allowed to give Medicare patients kickbacks for choosing their products.
If indeed Caring Voices influenced Medicare patients to choose prescriptions made by its backers, the charity will be in violation of federal law.
The charity receives contributions from pharmaceutical companies, which are allowed to give to non-profits, if they do not do so to sway those organizations.
The letter said Caring Voice had agreed it ‘may cease operations,’ but that is not required.
The charity’s board is ‘evaluating this very serious matter and will determine the most appropriate path forward,’ Chief Executive Gregory Smiley said in an emailed statement.
He said the group has worked over the past six months to ensure compliance with industry laws and regulations.
Caring Voice, based in Mechanicsville, Virginia, says it aims to improve the lives of patients with chronic illnesses, including helping them afford costly drugs by covering co-payments and other costs.
In recent months, companies including Pfizer Inc and Johnson and Johnson have said they were the subject of a US probe into drug-makers’ financial support of charities offering assistance to patients seeking help to cover out-of-pocket costs.
Health insurers, however, still end up paying more for the drugs they cover if prices are increased.
Drug companies are prohibited from subsidizing co-payments for patients enrolled in government healthcare programs like Medicare.
But companies may donate to nonprofits providing co-pay assistance as long as they are independent.
As rising drug prices face increased scrutiny, concern has arisen that donations from drug-makers to patient-assistance groups may be contributing to price inflation.