Chicago doc sentenced to prison in Medicaid drug kickback scheme

A Chicago psychiatrist who was once the biggest prescriber in the country of the antipsychotic drug clozapine to Medicaid recipients was sentenced to nine months in federal prison Friday for accepting kickbacks in exchange for prescribing the medication.

Dr. Michael Reinstein, 72, received nearly $600,000 in consulting fees, meals, tickets to sporting events, all-expenses-paid vacations and other kickbacks in exchange for prescribing the drug to thousands of elderly and indigent patients in Chicago-area nursing homes and hospitals, according to the U.S. attorney's office in Chicago.

Reinstein's attorney, Terry Campbell, said Friday was a difficult day for the doctor but he had the support of his family and many former patients.

"Dr. Reinstein spent his 40-plus year career caring for the severely mentally ill in our community, and did so with great dedication and skill," said Campbell. "Since this case arose, Dr. Reinstein has done everything in his power to make amends for his error in having accepted speaking fees from pharmaceutical companies."

Reinstein pleaded guilty last year to one count of violating the federal anti-kickback statute. The judge in the case is also requiring Reinstein to forfeit $592,000 and perform 120 hours of community service.

Clozapine has been shown effective for treatment-resistant forms of schizophrenia but can also have serious side effects, especially for elderly patients. Those side effects can include a potentially fatal decrease in white blood cells, seizures and inflammation of the heart muscle.

According to Reinstein's plea agreement, the doctor prescribed the brand-name version of clozapine known as Clozaril rather than the generic version because the drug's manufacturer paid him to promote it at speaking engagements.

When that deal ended in 2003, Reinstein then switched his patients to the generic version, but only after its manufacturers, Teva Pharmaceuticals and IVAX Pharmaceuticals, agreed to pay him a consulting fee and back a research study performed by an entity affiliated with the physician.

Reinstein previously agreed to pay $3.79 million to the state of Illinois to settle a civil lawsuit. Teva and IVAX also paid the state $27.6 million to settle civil allegations that they violated the state and federal False Claims Acts, according to the U.S. attorney's office.

Neither Teva nor IVAX, which was acquired by Teva in 2006, admitted any liability as part of that settlement.

Lisa Schencker

Lisa Schencker covers legal issues and enforcement agencies. Before joining Modern Healthcare in 2014, she was an education reporter for the Salt Lake Tribune and before that wrote for the Bakersfield Californian and the Scranton (Pa.) Times-Tribune. She has bachelor’s and master’s degrees in journalism from the University of Illinois at Urbana-Champaign.

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