Check out the entire series here.

I’ve been asking how it is that CTP/skin sub companies can advertise “the spread” on their product? I have posted examples of this type of advertising displayed at medical meetings, on Linked in and sent as emails to practitioners. In answer to my question, a reader sent me this information about the TAP Pharmaceuticals Fraud settlement with the federal Government over their marketing of the “Spread” of Lupron.  This settlement happened in October 2001 – 22 years ago!


From the Settlement:

“In addition, the United States alleged that TAP knowingly offered illegal remuneration to physicians by marketing TAP’s “Return to Practice” income. This income, the United States alleged, represented the spread between a TAP inflated Average Wholesale Price, used by Medicare and others to reimburse providers for certain drugs such as Lupron, and a discounted price that TAP actually charged providers for the drug.

The United States also alleged that TAP knowingly misreported and underpaid monies that it owed to the states under the federal Medicaid Rebate Program, 42 U.S.C. § 1396r-8. The government contended that TAP was generally required to rebate to each state the difference between the Average Manufacturer Price and its “Best Price” as defined by 42 U.S.C. §§ 1396r-8(k)(1) and 1396r-8(c)(1)(C). TAP, the government alleges, underpaid the states by miscalculating its “Best Price” by failing to include concessions it provided in sales of Lupron, including, for example, volume discounts and rebates.”

I am told that this case is cited in training programs for pharmaceutical sales reps to highlight the fact that “Selling the Spread” is a violation of Federal law etc. Yet, some CTP/skin sub companies are blatantly selling “the spread” despite these regulations. Can anyone tell me how this is possible if it’s not legal?