TAP officials on trial today in fraud case

In a case that challenges longstanding marketing tactics of the drug industry, eleven current and former officials of TAP Pharmaceutical Products go on trial today for allegedly defrauding the government of millions of dollars by bribing doctors and hospitals to buy and prescribe the company’s product instead of a less expensive rival drug.

Although the Illinois company already paid a record $885 million federal fine to settle similar charges, the new trial targets individual managers at the company and broadens the list of doctors and hospitals that were allegedly involved.

Federal prosecutors plan to introduce evidence that six hospitals, two health plans, 26 group practices, and 25 individual doctors from Massachusetts to California were offered or took bribes, including cash, free drugs, Red Sox and Yankees tickets, and trips to swanky resorts, according to a list of ‘‘kickback transactions’’ filed in US District Court in Boston. None of the medical professionals face charges in this trial.

At Yale-New Haven Hospital, the documents say, the urology department in 1999 asked for and received $10,000 from TAP to fund a seminar after threatening to switch patients from TAP’s prostate cancer drug Lupron, to a less expensive competitor.

A urology practice affiliated with the former New England Deaconess Hospital in Boston also played TAP against its competitor and from 1995 to 1998 received 111 free doses of Lupron, worth at least $400 each, according to the indictment and kickback records.

The doctors prescribed the samples to patients and billed Medicare for the full cost of the drug, turning the samples ‘‘into a cash kickback,’’ the indictment said. A spokesman for Beth Israel Deaconess Medical Center called the allegation ‘‘ancient history.’’ The indictment also alleges that TAP wiped out $11,000 of debt for a Boston-area doctor in exchange for his continued prescribing of Lupron.

The 11 TAP employees have pleaded not guilty to the criminal charges, arguing that the practice of giving gifts and sponsoring seminars were common in the industry and were legal because they did not amount to a quid pro quo, in which doctors accept gifts specifically in exchange for putting patients on a drug.

A former Massachusetts district manager for the company, a former Northeast sales representative, and four doctors — three from New England and one from Indiana — have pleaded guilty to related charges and are cooperating with the government.

A Plymouth doctor will face a separate trial on charges he sold drug samples that he had received free from the company. But the dozens of other doctors, hospitals, and health plans named in court filings have not been charged with any crime and either denied any wrongdoing or said they were aiding prosecutors.

The trial is the culmination of the government’s seven-year investigation into TAP’s activities.

The company pleaded guilty to participating in a criminal conspiracy by providing doctors with free Lupron samples for which doctors then billed Medicare. It paid $885 million in 2001 for that crime and to settle civil charges that the company inflated the list price of Lupron to ensure that doctors who prescribed it would make a sizable profit when the government reimbursed them for the drug. Prosecutors at that time said the company and its employees bilked the government out of $145 million during the 1990s and corrupted the medical judgment of many doctors.

Katherine Stueland, a TAP spokeswoman, declined to comment on the charges against its current and former employees. She said the company ‘‘has worked to strengthen its foundation of ethics and compliance.’’

Investigators built their first case against TAP with the help of a doctor from Tufts Health Plan, who refused a $40,000 bribe from TAP salespeople and then allowed prosecutors to bug his office when the salespeople came calling again. After the company’s plea, prosecutors filed criminal charges against key employees, including its vice president for sales.

Those charges are the basis for the case that starts today and is expected to continue for six months.

In documents supporting those charges, prosecutors asserted that Lahey Clinic officials agreed to continue prescribing Lupron only if TAP offset the clinic’s cost by about $100,000 by paying for a Christmas party, golf tournaments, and seminars and for providing free drug samples.

Lahey’s former chief executive has been talking with prosecutors in an attempt to dissuade them from charging him for his involvement.

The alleged provision of kickbacks to urologists at Yale-New Haven Hospital will be a key element in the case, prosecutors said in court memos. Urologists commonly prescribe Lupron as an alternative to surgery for prostate cancer patients. After TAP increased Lupron’s price in 1999, a Yale urologist threatened to switch the practice’s patients to a competing drug, according to the government.

When TAP employees asked how they could keep the business, a department official requested funding for a urology seminar. David Guido, who worked for TAP as a hospital account executive, solicited money from colleagues’ budgets, warning them not to copy or print his e-mails because of the ‘‘technique’’ he was using. He gave the money to Yale in three checks, the documents assert.

‘‘The current HAE [hospital account executive] was able to raise $10K for the fall conference through TAP sources & save the Lupron account,’’ Guido wrote to TAP colleagues in 1999, according to a government memo. ‘‘Approximately 40 patients have converted to Lupron.’’

Tom Conroy, a spokesman for Yale, declined to comment on the alleged events, saying only that the institution had ‘‘responded to all requests by investigators.’’ Guido’s attorney, Jeremy Margolis, said: ‘‘Guido is innocent. He’ll be found innocent.’’

A TAP district manager, Kimberlee Chase, who pleaded guilty in December to conspiracy to commit fraud, allegedly oversaw TAP’s writeoff of $11,000 in debt for a Boston-area doctor who owed the company more than $24,000 after buying out the practice of a Hingham doctor, including his debt to TAP. A collection agency hired by TAP wrote to the doctor that ‘‘in consideration for TAP’s settlement of the outstanding debt, you have agreed to switch all of your patients to Lupron Depot,’’ according to the indictment. The doctor, who is not named in the indictment, signed the collection agency’s statement in January 1996.

In a separate list of ‘‘kickback transactions,’’ the government says Dr. Clifford Gluck, a urologist who now has offices in Dorchester, Officials in TAP Pharmaceuticals Weymouth, and Hingham, had debt forgiven by TAP and received an educational grant and a television and VCR from the company in 1996 and 1997. Gluck did not return repeated calls seeking comment.

The government alleges TAP used similar tactics across the country. Employees allegedly offered the Los Angeles County Department of Health Services and at least four associated hospitals illegal inducements totaling $65,826 to buy Lupron and Prevacid, a heartburn drug. Court documents allege the inducements included honoraria, grants for retreats, money for ‘‘Hawaii programs,’’ and so-called educational grants.

Royal Martin, an attorney for TAP manager Carey Smith, who prosecutors allege made offers to the Los Angeles hospitals, said, ‘‘there was no quid pro quo for any grants provided. Every penny went to actual educational programs.’’ Los Angeles health officials declined to comment.

Shelley Murphy of the Globe staff contributed to this report. Alice Dembner can be reached at Dembner@globe.com.