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Hospital, psychiatrists in Texas feel blowback from kickback schemes

Separate investigations lead to a $21 million settlement with a county hospital, and resignations from two state psychiatrists

Kickback schemes involving state employees and healthcare facilities are alive and well in Texas. Over the last several weeks, separate fraud investigations have cost one hospital more than $21 million and forced the resignation of two state psychiatrists who took payments from AstraZeneca. 

Last week, Citizen's Medical Center, a county-owned hospital located in Victoria, agreed to pay $21.75 million to settle claims that it paid physicians in exchange for patient referrals, according to a Department of Justice statement. Federal prosecutors claimed the hospital paid cardiologists above fair-market value in exchange for cardiology referrals and provided bonuses to emergency department physicians who improperly accepted those referrals. The lawsuit was originally filed by three whistleblowers.

The settlement came days after two psychiatrists at Terrell State Hospital resigned after an investigation revealed that they accepted payments from AstraZeneca to promote Seroquel and Seroquel XR, according to the Texas Tribune. Anthony Claxton, M.D., the hospital's clinical director, and Lisa Perdue, M.D., a psychiatrist at the hospital, both received hundreds of thousands of dollars in speaking fees and consulting services from the pharmaceutical manufacturer.

All told, Claxton received $231,000 and Perdue received $615,525 as far back as 2005. In return, documents from the Texas Department of State Health Services show both psychiatrists lobbied to get the antipsychotic drug added to the state's list of approved drugs. Officials said the transgression surfaced during an investigation by the Texas Attorney General into illegal marketing techniques AstraZeneca used to promote Seroquel.

In October, the Texas AG filed claims that company sales representatives misled doctors and paid more than $465,000 to top state officials, FiercePharma previously reported. In a follow-up report, a state official told the Wall Street Journal that Seroquel has been on the state formulary since 2004, but Seroquel XR was never added. The official added that no patients were harmed as a result of the kickback scheme.  

AstraZeneca has a long and tumultuous history of allegations involving illegal marketing and kickback practices, particularly involving Seroquel. In 2010, the company paid $520 million to settle claims that it paid kickbacks to market the schizophrenia drug. More recently, in February, AstraZeneca paid $7.9 million settlement to resolve claims they paid kickbacks to a pharmacy benefit manager to promote the heartburn medication Nexium.  

For more:
- here's the DOJ statement
- read the Texas Tribune article
- read the Wall Street Journal article

Related Articles:
Without accountability, pharma will happily keep dishing out kickback settlements
AstraZeneca $7.9M kickback settlement shows risks of payer discounting
Texas AG: AstraZeneca paid $465K in kickbacks, committed fraud in Seroquel marketing