Under the settlement, PillPack agreed to pay approximately $5.79 million to the United States and various states that were fraudulently overbilled for insulin. The company also admitted and accepted responsibility for dispensing insulin pens that exceeded days-of-supply limits imposed by government health care programs.

"Pharmacies are trusted to provide accurate information to government health care programs and to prevent waste when dispensing medications to patients. PillPack abused this trust," Williams said in a statement. "This office will continue to hold pharmacies accountable when they submit false information and waste taxpayer dollars."

Insulin pens are a common way for diabetic patients to self-administer insulin. Manufacturers most frequently distribute insulin pens in five-pen cartons, with each pen containing 300 units of insulin solution. Pharmacies can dispense such pens to patients only with valid prescriptions from licensed prescribers. Valid insulin prescriptions must set forth the "directions for use," which typically designate how much insulin to administer and the frequency and/or timing of when to administer it.

When PillPack sought reimbursement from government health care programs for insulin pens, it was required to report the quantity dispensed and the days of supply. The "quantity dispensed" specifies the amount of medication being dispensed to a patient when the pharmacy fills the prescription, and the "days-of-supply" refers to the number of days that the dispensed medication should last if the patient uses it according to the directions in the prescription.

According to the U.S. government's complaint: From April 2014 through November 2019, PillPack's general practice was to dispense insulin pens to patients using full cartons. PillPack would dispense and bill for the full carton, and falsely underreport the days of supply to make it appear that the dispensing did not violate the program's days-of-supply limit.

The practice of under-reporting days of supply also led PillPack to dispense premature refills to program beneficiaries, the complaint noted. Whenever PillPack recorded in its internal system the inaccurate lower days-of-supply that were submitted to conform with the days-of-supply limit, the system would generate a premature refill due date. As a result, PillPack pharmacists frequently dispensed insulin pen refills days or weeks before patients actually needed them according to their prescriptions.

The settlement requires PillPack to pay $5.62 million to the United States government. PillPack has agreed to separately pay approximately $175,523 to state governments, for a total of more than $5.79 million.

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