With the implementation of Medicare Part D in the United States for nearly two decades, the establishment of patient support programs (PAPs) by pharmaceutical companies has increasingly become the focus of medical policy. In recent years, the federal government has continued to strengthen its regulatory efforts, through the Office of the Inspector General (OIG) of the Department of Health and Human Services (OIG) and the Centers for Medicare and Medicaid Services (CMS), especially for PAP supervision provided through charities, to establish a multi-level compliance management framework, and require regular audits, with the aim of maintaining access to medication and curbing the misuse of medical resources.
From direct subsidies to independent philanthropic models
In 2005, the OIG issued a special advisory notice specifying that PAPs operated by pharmaceutical companies may be at risk of violating the Anti-Kickback Act, and that this may induce improper prescribing practices. For example, aid models operating through independent charities must be regulated, provided that there is an independent board of directors and that charitable foundations are funded in a diversified and transparent manner.
From transitional policies to strict regulation
When Medicare Part D was first introduced, the OIG allowed pharmaceutical companies to transfer beneficiaries to independent charities through a reasonable transition period, and in recent years, it has been explicitly required that companies must submit clear reports on the progress of the transfer, and companies are not allowed to use the transition period as an excuse to circumvent long-term supervision.
Announcement of the standards for the operation of charities
Recent policies have emphasized the need for independent charities to establish multiple firewalls, including diversification of donor sources, objectification of disease classification, and standardization of financial approvals. In 2023, new regulations on the handling of biosimilar drugs will be added, requiring PAPs to clearly mark the reference drug code and distinguish the calculation method of assistance, so as to enhance the transparency of patient assistance and avoid potential abuse.
Strengthen compliance data management
The CMS places a strong emphasis on data protection and usage compliance, requiring PAPs to be strictly separated from Medicare system information and data to be used only for eligibility verification. And the introduction of electronic audit technology, including blockchain evidence preservation and AI anomaly monitoring, to strengthen the trend of supervision technology.
Antitrust risks are rising, and syndicated transactions are regulated
Recently, the PAP jointly operated by multinational enterprises has also attracted great attention, and a multinational pharmaceutical company has been fined hundreds of millions of dollars for being involved in joint acts, reflecting the government’s strict attitude towards antitrust risks.
Digital regulation vs. real-world data
From 2025, electronic audit will become a mandatory standard, and PAPs that fail to access in time will be suspended. It is advisable to deploy digital Regtech solutions in advance to cope with increasingly complex regulatory requirements. In addition, real-world data (RWD) and AI approval systems will gradually become the new focus of regulation, indicating that the PAP field will enter a stage of digital transformation.
Resources
https://www.cms.gov/medicare/coverage/prescription-drug-coverage/patient-assistance-program
