Drugmakers fined over illegal kickbacks to copay assistance foundations. Credit: Dmitry Moraine on Unsplash.

Amgen and Astellas Pharma US have agreed to pay a total of $124.75m to settle allegations that they paid kickbacks to Medicare copays for their own medications.

Astellas will pay $100m while Amgen will pay $24.75m. Neither company has admitted to the claims and each signed a five-year corporate integrity agreement (CIA) as part of the settlement.

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The US Department of Justice (DOJ) alleged that the companies worked with an independent foundation to support prostate cancer patients taking their androgen receptor inhibitor (ARI) drug Xtandi.

"The companies’ payments to the foundations were not donations, but rather were kickbacks that undermined the structure of the Medicare programme."

The government claimed that Xtandi was the only major ARI indicated to treat a certain form of prostate cancer. It suggested that the company promoted the ARI funds as an advantage for its drug over other competing medications to motivate medical providers to prescribe Xtandi.

Allegedly, Amgen also used a second foundation to create a fund to support its secondary hyperparathyroidism drug Sensipar. This fund is said to have covered patients taking the medication until June 2014.

US Attorney Andrew Lelling said: “As a result, the companies’ payments to the foundations were not donations, but rather were kickbacks that undermined the structure of the Medicare programme and illegally subsidised the high costs of the companies’ drugs at the expense of American taxpayers.”

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The DOJ further claimed that Amgen’s Onyx Pharmaceuticals used a separate fund as a conduit for illegal payment of healthcare-related travel costs of patients using its multiple myeloma drug Kyprolis.

Earlier this month, Jazz Pharmaceuticals, Lundbeck and Alexion Pharmaceuticals settled on similar allegations.