How Patient Support Programs in Pharma Work and Stay Legal

Patient support programs in pharma are manufacturer-sponsored initiatives that help patients access, afford, and stay on prescribed medications, ranging from copay assistance and free drug supplies to full-service “hubs” that handle benefits verification, prior authorization, and adherence coaching. They are legal when designed carefully, but they sit close to a federal criminal statute, and the past few years of court rulings and settlements have narrowed the space in which they can operate.

What These Programs Actually Do

At the simple end, a program covers a patient’s copay, coinsurance, or the full cost of a drug for people who meet income or insurance criteria. At the complex end, programs run through centralized service centers, called hubs, that verify insurance, chase prior authorizations, coordinate specialty pharmacy delivery, provide nurse education, and track whether patients stay on therapy. The hub model has become standard for specialty and rare-disease drugs, where a single dose can run into the hundreds of thousands of dollars, and cell and gene therapies exceeding $500,000 per dose have pushed hubs into site-of-care logistics and long-term outcomes tracking.¹

There is no single template. As one hub vendor executive put it, “If you’ve seen one hub, you’ve seen one hub.” The variation reflects real differences among oncology, autoimmune, rare disease, and gene therapy access barriers.¹

Who Runs Them

The large pharmacy benefit managers and their affiliated pharmacies, including CVS Health, Express Scripts, Optum, and Prime Therapeutics, hold significant share of this work. A parallel set of specialized vendors has consolidated: Eversana acquired Dohmen Life Sciences Services and Triplefin; CareMetx acquired Biosolutia and Virmedica; and McKesson folded RxCrossroads into its life sciences unit after buying it from CVS Health in 2017. Several hub providers have also stood up their own noncommercial pharmacies to fulfill programs directly.¹

The Legal Line: The Anti-Kickback Statute

The core legal risk comes from the federal Anti-Kickback Statute (AKS), which makes it a crime to knowingly offer or pay anything of value to induce the purchase of items or services covered by Medicare or other federal health programs. The statute has twelve specific exceptions, covering things like bona fide employment and certain pharmacy copay waivers, and patient assistance programs do not fit neatly into any of them.²

The Department of Health and Human Services Office of Inspector General (OIG) has long said manufacturers may donate to genuinely independent charitable foundations that help patients with out-of-pocket costs. The foundation cannot, however, function as a conduit that steers patients to a specific company’s drugs. That line has been the subject of billions of dollars in enforcement and several important court decisions.

What Recent Courts Have Held

In September 2021, a federal court in the Southern District of New York rejected Pfizer’s challenge to an OIG advisory opinion that had deemed the company’s proposed Direct Program, which would have provided copay assistance directly to Medicare patients, an AKS violation. The court held that the statute does not require “corrupt intent” or a direct quid pro quo; knowingly providing remuneration intended to induce a purchase is enough.³

The Fourth Circuit went further in January 2025 in Pharmaceutical Coalition for Patient Access v. United States. The coalition, a charity providing oncology copay subsidies limited to patients using drugs from its own funding manufacturers, challenged an unfavorable OIG opinion. The court affirmed summary judgment for the government, holding that “induce” carries its ordinary meaning (“to lead on; to influence; to prevail on”) rather than a narrower criminal-law meaning, and that “remuneration” reaches any payment, not just corrupt payments. The court identified the coalition’s design as carrying “hallmark risks of fraud and abuse”: higher costs to Medicare, steering patients toward specific manufacturers, and anti-competitive effects.⁴²

The Fourth Circuit explicitly disagreed with the Sixth Circuit’s narrower reading in United States ex rel. Martin v. Hathaway, creating a circuit split on how far the statute reaches. A similar challenge, Vertex Pharmaceuticals v. U.S. Department of Health & Human Services, went against the manufacturer at the district court level and was on appeal to the D.C. Circuit as of early 2025.²

What the OIG Considers Low Risk

Not every program draws enforcement. In Advisory Opinion 25-01, issued January 15, 2025, the OIG reviewed a manufacturer program providing a free Alzheimer’s infusion therapy to underinsured and uninsured patients and called it low risk. The design features that mattered to the OIG were:

Eligibility was set uniformly by financial need, at or below 500% of the federal poverty level, verified through credit checks or income documentation.
The program was managed by a patient services organization independent of the manufacturer’s sales and marketing teams.
Staff compensation was not tied to drug sales.
Patients and physicians certified they would not seek federal reimbursement for the free drug.
Eligibility was agnostic to the specific physician or infusion provider.

The OIG stressed the opinion was limited to those facts. The favorable outcome depended on the free drug never being billed to federal programs and prescribers receiving no financial incentives tied to it.⁵

Enforcement Actions That Set the Boundary

The Department of Justice has collected over $1 billion in settlements from pharmaceutical companies on copay-related AKS allegations.³ A handful of cases show what draws prosecution.

In October 2024, Teva Pharmaceuticals agreed to pay $450 million to resolve allegations it funneled hundreds of millions of dollars to copay foundations to induce Medicare patients to purchase Copaxone, its multiple sclerosis drug. DOJ said Teva used data from a specialty pharmacy, Advanced Care Scripts, to track prescriptions and ensure its donations benefited only patients on its own drug. The settlement included a criminal penalty under a deferred prosecution agreement. Advanced Care Scripts had previously settled for $3.5 million, and Patient Services, Inc., a foundation accused of serving as a conduit, settled for $3 million.⁶

In 2018, Pfizer paid $23.85 million and entered a corporate integrity agreement over civil charges that it used a third-party charity to cover copays for three of its drugs.³ Two other unnamed manufacturers paid a combined $125 million over similar allegations.⁶

Enforcement has also reached specialty pharmacies. BioTek Remedy, a Delaware-based specialty pharmacy, agreed to a $20 million settlement in September 2023 after the government alleged it routinely waived copayments for Medicare and TRICARE patients without regard to financial hardship and gave physicians gifts, dinners, and free administrative support to induce referrals. Two whistleblowers received over $4 million.⁷

States are active too. Texas sued Eli Lilly in 2025, alleging the company provided free nursing and reimbursement support services to healthcare providers as inducements to prescribe Lilly drugs. Texas Attorney General Ken Paxton said “Big Pharma compromised medical decision-making by engaging in an illegal kickback scheme.”⁵

Policy Shifts That Change the Picture

Two policy developments are reshaping the context these programs operate in: Medicare Part D redesign and government-facilitated direct-to-consumer pricing.

The Medicare Part D Cap and GLP-1 Bridge

The Inflation Reduction Act introduced a $2,000 annual out-of-pocket cap for Medicare Part D beneficiaries starting in 2025, changing the financial math for both patients and copay assistance. The combination of that cap and recent court losses has pushed Congress to consider clarifying legislation, including H.R. 9184 in the 118th Congress, which would have codified statutory exceptions for patient assistance programs.²

The Medicare GLP-1 Bridge, a nationwide demonstration running from July 1, 2026, through at least December 2027, lets eligible Part D beneficiaries access Wegovy and Zepbound for a $50 monthly copay. The Bridge sits outside the standard Part D benefit: the copay does not count toward a deductible or the out-of-pocket maximum, low-income subsidies do not apply, participating manufacturers supply the drugs at a $245 net monthly price, and manufacturer coupons cannot be applied to Bridge claims.⁸

A voluntary model called BALANCE begins in May 2026 for Medicaid and January 2027 for Medicare, letting Part D plans and state Medicaid agencies access lower net prices for GLP-1 drugs through supplemental rebates. Participating Medicare plans must adopt standardized cost-sharing, $50 per month for enhanced plans and $125 per month for basic plans, with a $2,400 out-of-pocket cap after which patients pay nothing.⁹

TrumpRx and Direct-to-Consumer Pricing

TrumpRx.gov is a federal platform that directs patients to manufacturer direct-buy portals for cash-priced medications. As of December 2025, nine manufacturers had signed agreements to sell products at prices aligned with a “most-favored-nation” benchmark reflecting the lowest price paid by other developed nations: Amgen, Boehringer Ingelheim, Bristol Myers Squibb, Genentech, Gilead Sciences, GSK, Merck, Novartis, and Sanofi. The reductions were substantial. Gilead’s Epclusa dropped from a list price of $24,920 to $2,425, and Sanofi committed to $35-per-month insulin.¹⁰

The platform targets Medicaid and cash-paying patients primarily. Participating manufacturers receive a three-year suspension of potential tariffs on pharmaceutical imports. Fourteen of seventeen originally targeted companies had reached deals by late 2025; AbbVie, Johnson & Johnson, and Regeneron either declined or were still negotiating.¹¹ How TrumpRx interacts with existing patient assistance programs has not been formally defined, but it introduces a new channel that could reduce the role of manufacturer copay programs for some patient populations.

Where This Leaves Manufacturers and Patients

The legal environment is unsettled. The Fourth Circuit’s broad reading of the AKS, the split with the Sixth Circuit, and the pending D.C. Circuit litigation all point toward eventual Supreme Court review or congressional action. Combined with the Part D out-of-pocket cap and the new direct-to-consumer channels, the traditional model of manufacturer-funded copay support routed through third-party foundations is under sustained pressure.

The design corridor is narrow but real. Advisory Opinion 25-01 shows that free drug programs with rigorous independence safeguards, uniform financial-need criteria, and no federal reimbursement can still get favorable treatment. Any structure where a manufacturer’s financial assistance correlates with the use of its own products in federally reimbursed patients continues to attract scrutiny. The $450 million Teva settlement and the Fourth Circuit’s rejection of the Pharmaceutical Coalition for Patient Access are the clearest markers of where the government has drawn the line.

1
ConnectiveRx. Patient Support and Hub Services Continue to Evolve
2
Congressional Research Service. Fourth Circuit Ruling on Anti-Kickback Statute and Patient Assistance Programs
3
Loeb & Loeb LLP. AKS Violation Does Not Require Corrupt Intent in Pfizer Medicare Patient Assistance
4
U.S. Court of Appeals for the Fourth Circuit. Pharmaceutical Coalition for Patient Access v. United States, No. 24-1230
5
Arnold & Porter. OIG Deems Free Drug Patient Assistance Program Low Risk in Advisory Opinion 25-01
6
Benesch Law. Third-Party Co-Pay Assistance Program Kickback Scheme Results in $450 Million DOJ Settlement
7
PAAS National. Specialty Pharmacy Paying the Price: $20 Million Settlement for Kickbacks and Copay Waivers
8
Centers for Medicare & Medicaid Services. Medicare GLP-1 Bridge
9
Kaiser Family Foundation. What to Know About the BALANCE Model for GLP-1s in Medicare and Medicaid
10
The White House. Fact Sheet: Largest Developments to Date in Bringing Most Favored Nation Pricing to American Patients
11
Pharmacy Times. Trump Announces Pricing Deals With 9 Drugmakers