Debarred By FDA! For What? For How Long? Really?

By Benjamin K. Wolf* & John R. Fleder –

Dr. Glen R. Justice, a 67 year old oncologist and hematologist, pleaded guilty to defrauding government, public and private insurers out of at least $400,000.  The government alleged that Dr. Justice billed for treatments either not given or which were for more expensive medications than were provided.  According to news articles here and here and a July 2011 press release issued by the Department of Justice here, DOJ originally planned to recommend that Dr. Justice receive probation as part of his plea to the five counts of health care fraud, each a felony punishable by up to ten years in jail.  Dr. Justice instead received a sentence of 18 months in jail plus he was ordered to make restitution of slightly over $1 million after the prosecutor recommended jail time.  Why the change of heart?  Dr. Justice allegedly continued these billing practices after he had signed the plea deal.  As a result of his conviction, the California Medical Board suspended Dr. Justice’s license to practice medicine.

Our astute readers might be asking: what does this have to do with the FDA?  We wondered the same thing when we saw the notice in the Federal Register last week in which FDA announced that it was debarring Dr. Justice for 25 years.

The relevant FDA debarment provision provides for “permissive” debarment when (1) FDA finds that an individual has been convicted of a felony which involves fraud; and (2) FDA finds that such individual has demonstrated a pattern of conduct sufficient to find that there is reason to believe that such individual may violate the FDCA relating to drug products.  21 U.S.C. § 335a(b)(2)(B)(ii)(I).  Debarment under § 335a(b)(2)(B)(ii) is not to exceed five years per count.  §335a(c)(2)(A)(iii).  A debarred individual may not provide services to anyone who has an approved or pending drug product application.  § 335a(c)(1)(B).  A more complete explanation and history of the FDA debarment statute may be found here.

In this case, the Agency found that Dr. Justice had demonstrated a pattern of conduct sufficient to find that FDA had reason to believe that he may violate the FDCA relating to drug products.  This was based on FDA’s conclusion that (1) Dr. Justice shirked his legal and professional obligations to bill honestly and treat his patients with appropriate medications for their conditions and (2) because the drugs he billed for were “FDA-regulated.”  FDA did not explain how such conduct would violate the FDCA.

We are aware of only one other instance when a FDA debarment was based on the rationale underlying Dr. Justice’s debarment.  Dr. Ehigiator O. Akhigbe’s 25-year FDA debarment was announced in a Federal Register notice on December 17, 2010.  Dr. Akhigbe was debarred after he was convicted of one count of health care fraud and 16 counts of false statements in health care matters.  Like Dr. Justice, he allegedly submitted claims for procedures and treatment he did not perform.

It is difficult to discern the reasoning behind the length of Dr. Justice’s debarment where FDA seemed to determine the period of debarment by simply multiplying the number of counts as to which Dr. Justice pleaded guilty (five) by the maximum length of the debarment period for each offense (also five).  In contrast, the Federal Sentencing Guidelines urges federal judges to impose sentences for convicted persons by grouping the counts as to which a person has pleaded guilty, rather than impose a sentence based solely or largely on the number of counts as to which that person has pleaded guilty.  For FDA debarment, the opposite seems to be true.  We are left to wonder why Dr. Justice, who will be 92 when he can once again provide services to drug companies, essentially got a lifetime debarment?

Unfortunately, we also can not answer an even more puzzling question raised by the Dr. Justice debarment.  Why did FDA debar Dr. Justice for health care fraud, for conduct that seems unrelated to violations of the FDCA, when FDA has obviously chosen not to debar a multitude of other persons convicted of health care fraud every year for offenses unrelated to the FDCA?

We certainly are supportive of FDA exercising prosecutorial discretion when the Agency chooses not to debar certain people.  However, FDA’s decision in the Justice case, both in terms of the decision to debar him and the length of the debarment period suggests that FDA may be arbitrarily singling out one or two people for an extensive period of debarment without any clearly articulated rational and legal basis for doing so.

We expect to be soon reporting on the outcome of the D.C. Circuit’s long-awaited decision in the HHS debarment proceedings involving former executives in the Purdue Frederick Co., Inc. case.  That case was argued in December 2011, and we expect a decision will be rendered soon.  Our earlier blog post can be found here.

* Summer Associate