Introduction: In its recent decision in United States v. Regeneron Pharmaceuticals, Inc., the United States Court of Appeals for the First Circuit deepened an existing federal circuit court split regarding the causation standard to apply under the False Claims Act (FCA) for violations of the federal Anti-Kickback Statute (AKS).1 The split is likely to invite the Supreme Court to weigh in on the issue sooner rather than later.
The FCA and AKS: The FCA is a powerful instrument in federal health care fraud enforcement. It imposes liability on individuals and companies that defraud the government by submitting "false or fraudulent" claims for payment by the government, such as reimbursement claims for medical goods and services covered, in whole or in part, by Medicare or Medicaid.2 The AKS, in turn, prohibits, among other things, individuals and companies from knowingly and willfully inducing someone through incentives, such as cash payments or in-kind services, to buy or sell medical goods or services that are ultimately subsidized by the government.3
One way for the government to prove a claim is "false or fraudulent" under the FCA is by demonstrating that it included items and/or services "resulting from" a violation of the AKS. A 2010 amendment to the AKS expressly provided that FCA liability attaches where an individual or company bills the government for a medical item or service that "result[ed] from" a violation of the AKS.
The meaning of the phrase "resulting from" in the AKS, however, has become a focal point of disagreement among the federal circuits.
The Regeneron Case: Regeneron involved a drug manufacturer's contributions to a copayment assistance program. The drug manufacturer, Regeneron, funded an independent charitable organization, which in turn subsidized patient...
