Gray curtain of tumor genetic testing: kickbacks, false reports, insurance fraud

In the past one or two years, various localities have successively issued documents to standardize the business of genetic testing hospitals and strengthen supervision over the delivery of samples. The picture shows a pathologist extracting a tumor genetic test sample on March 7, 2020. Visual China | fig

At the end of March 2024, an image titled "Genetic Testing Cash Rebate Reporting Letter" circulated on online platforms, pointing the finger at the expensive tumor genetic testing program, claiming that there was a 20%-40% cash rebate.

The report letter listed two tables pointing out that three tumor genetic testing items priced from 4,800 yuan to 15,900 yuan had a rebate of 20%, and seven other models had a greater rebate, with a rebate of 40% for out-of-hospital genetic testing items ranging from 8,800 yuan to 29,800 yuan. The payment was made by two staff members from Burning Rock Medicine's Jinglu Region and Shandong.

Burning Rock is a leading start-up company engaged in genetic testing in China, focusing on high-throughput gene sequencing technology (NGS). In 2020, Burning Rock Dx was listed on the NASDAQ in the United States, known as "the first domestic NGS stock in the United States".

On the evening of March 27, Burning Rock Medical posted a response on its official WeChat, saying that the two staff members on the report letter were indeed employees of the company, but they were released by others who fraudulently used the identities of the two employees, and the employees themselves did not know the content of the online transmission, and the content of the report letter was maliciously fabricated and disseminated.

On April 10, Burning Rock Medical Public Relations staff told Southern Weekend that the company had reported the matter to the police, and there would be no public response until the follow-up investigation results came out, and the company paid great attention to compliance.

Southern Weekend reporters contacted the discipline inspection committees of more than a dozen hospitals mentioned in the report letter and the discipline inspection and supervision team of the National Health Commission, but most of them did not respond to the report. Among them, the operator of the Discipline Inspection and Supervision Office of Beijing Cancer Hospital said that he had not received the cash kickback report letter, and the operator of the Discipline Inspection and Supervision Group of the Shandong Provincial Commission for Discipline Inspection and Supervision in the Provincial Health Commission said that "the specific case handling situation is confidential".

Although the incident is not yet clear, the whistleblower letter puts the genetic testing industry on the cusp again. Tumor gene testing is the compass of cancer treatment, and determining the status of mutant genes is a very important part of individualized precision diagnosis and treatment. Tumor genetic testing is also considered to be the "next gold mine" after non-invasive prenatal genetic testing, and companies are trying to find ways to occupy more market share on the sales side, and all kinds of chaos will inevitably occur.

As a result, genetic testing has become the focus of governance. In May 2023, 14 ministries and commissions, including the National Health Commission, issued the "Notice on the Key Points of Work to Correct Unhealthy Practices in the Field of Pharmaceutical Purchase and Sales and Medical Services in 2023", stating that one of the key points of rectification is "sales with money" in various names or forms, and proposing to deal with issues such as the forced promotion of third-party services such as genetic testing or out-of-hospital drug purchases.

"There is a rebate to send samples"

After learning about the kickback ratio disclosed in the above-mentioned report letter, Zhao Xiaoai, an oncologist at a tertiary hospital in China, was not surprised. "Patients have a need for genetic testing, and most of them have rebates for genetic testing, and only with rebates can there be an incentive to send samples, and the rebates will mainly go to doctors. ”

From the sales side, genetic testing products are mainly divided into in-hospital and out-of-hospital sales, corresponding to two business models: one is the hospital cooperation model, where enterprises and hospitals carry out all-round cooperation, including hospital outsourcing service cooperation, product (testing instruments and reagents) cooperation, and research (co-construction of laboratories) cooperation;

There may be a "sale with gold" in both business models. For example, in 2012, the head of a pharmaceutical company gave 10,000 yuan in cash to Chen Liangyue, head of the hospital's equipment department and director of the pharmacy department, in order to carry out a cancer genetic testing project in the First People's Hospital of Anqing City, Anhui Province, and sell the genetic testing chips operated by the hospital to the hospital. According to the second-instance verdict, Chen took advantage of his position to sometimes accept quarterly sales commissions from medical representatives, and sometimes directly accepted cash and shopping cards. It is worth mentioning that before and after Chen Liangyue was investigated, Gao Jinhua, the former vice president of the hospital and an expert in the treatment of intracranial tumors, and Jiang Yinsheng, the former deputy director of the Quality Management Supervision Office, were also investigated.

Han Xiaochen is the director of Beijing Yuntong Law Firm and the general counsel of the "Dancing with Cancer" public welfare forum in China. She learned from a number of genetic testing companies that tumor gene company's products are expensive, with an average of 30%-40% of the money spent on the admission process and doctors. There are also some companies that are specially born to open up the sales side, do not set up their own laboratory testing and analysis, and only need to package the test results sent back by foreign laboratories into their own reports to earn the price difference.

A medical representative who has been in the industry for nearly 20 years told Southern Weekend that rebates for IVD testing in vitro testing have become "a transparent secret" and that "benefit fees" can be given according to the price points or the "quack price" of hospitals.

"The inextricable connection between them [genetic testing companies] and doctors is not necessarily measured in terms of money, but can also be long-term academic cooperation, such as feedback data to help doctors do scientific research, support doctors to hold conferences or conferences abroad, etc. Han Xiaochen believes that the tumor genetic testing industry not only tests the technical strength and compliance awareness of the gold diggers, but also tests the ethics and sense of responsibility of the doctors closest to the patients.

Generated demand

The cost of testing is often thousands or tens of thousands, which makes many cancer patients struggle with whether to do genetic testing.

Shen Mo's father was diagnosed with lung cancer in 2021, and it is a relatively rare small cell lung cancer. In order to get more accurate treatment, Shen Mo paid more than 12,000 yuan to a genetic testing company on the recommendation of a doctor from a tertiary hospital in Shanghai, and sent pathological samples to the hospital for testing. Eventually, a report with "many pages like a magazine" was obtained, and the conclusion was that there were currently no targeted drugs available, only chemoradiotherapy.

"The name of this test product is Genetron Health 825 gene, which tests many genes that are difficult for ordinary people to understand. Shen Mo later learned that small cell lung cancer patients like my father, who have been smoking for 30 years, have an obvious pathogenic mechanism, and there is basically no targeted drug to choose from, so they can not do genetic testing.

"According to the medical guidelines for different cancers, only patients with indications need to do genetic testing. Generally speaking, patients with advanced cancer need to do more than the early group, and the proportion of patients with different types of cancer who need to do it also varies, for example, it is more common for lung cancer patients to do genetic testing. The aforementioned oncologist Zhao Xiaoai introduced.

The "blowout" of domestic tumor gene testing is closely related to the reform of drug supervision and the rise of innovative drugs. In December 2021, the National Health Commission stipulated in the Guidelines for the Clinical Application of New Anti-tumor Drugs (2021 Edition) that drugs with clear targets must be followed before they can be used after target testing.

It should be pointed out that not all drugs need to be tested for genetic testing, taking lung cancer as an example, the above guidelines clearly list 14 drugs that need to be detected are osimertinib, and 11 drugs that do not need to be detected are bevacizumab.

Compared with the demand for clinical drug testing, the medical insurance policy also has clear requirements for tumor genetic testing results.

Taking osimertinib, the "star drug" of lung cancer, as an example, the query page of the drug catalog of the National Health Insurance Administration shows that the drug belongs to the class B drug of medical insurance, and from January 1, 2024 to December 31, 2024, only three types of lung cancer patients can be reimbursed by medical insurance, and all of them are related to gene sites. For example, the third category requires the treatment of adult patients with locally advanced or metastatic non-small cell lung cancer who have progressed on or after prior treatment with EGFR tyrosine kinase inhibitors (TKIs) and have been tested to be positive for EGFR T790M mutations.

In other words, lung cancer patients with EGFR mutations who test negative for T790M can only buy osimertinib at their own expense, and negotiate about 15,300 yuan for one box before the price reduction, and about 5,500 yuan for one box after the negotiation price reduction, and if the T790M is tested positive, the self-payment part of the patient is only about 1,000 yuan to 1,500 yuan per box after being reimbursed by medical insurance.

In reality, some patients are unable to extract pathological tissues in vivo for genetic testing due to the location of the lesion or physical state, and can only use venous blood sampling for testing, but this is not the "gold standard" for tumor genetic testing, and there is a certain chance of false negatives. However, patients who do not test positive and cannot "go through medical insurance" to buy targeted drugs are likely to learn about the way of falsifying genetic test reports from patients or medical representatives, so they take risks.

Making things out of nothing, half-truths, and deliberate tampering

Lawyer Han Xiaochen is also a family member of a cancer patient, and many people have complained to her about the outrageous experience related to genetic testing. For example, a report of "making something out of nothing": the oncologist received a "test report" from a genetic testing company before the patient's sample was sent for various reasons.

In addition to the "out of nothing" report, there are also half-truths and half-false test reports: some tests were indeed done and a report was issued, while another part of the test was not done, and the report was PS by the sales representative with software, which caused the patient to prescribe the wrong drug and delay the treatment time.

Han Xiaochen still remembers the experience of a young lung adenocarcinoma patient from Shandong. The doctor privately recommended a genetic testing company to the patient, and the testing fee was about 8,000 yuan, and the payment was "no invoice".

After getting the test report, the patient took targeted drugs for the treatment of EGFR gene mutations according to the test results, and his body not only did not improve, but also deteriorated. Later, the patient and his family contacted the genetic testing company, only to find that the company had only done chemotherapy drug susceptibility testing, but had not done genetic mutation testing. The sales representative intercepted this part of the expenses, did not hand it over to the company, and engraved a "carrot chapter" to make a false report to fool the patient.

Making false reports is like a game of probability. A report with a high degree of falsity and authenticity is difficult for even experienced oncologists to distinguish. 40%-45% of Asian lung adenocarcinoma patients have EGFR gene mutations, and it just so happens that this Shandong patient has another ALK fusion mutation with a low probability.

"After the patient switched to the right targeted medication, his health improved, his survival was extended for several years, and he also saw his child go to college. Han Xiaochen said.

There is also a type of false report to defraud the health insurance fund. At the beginning of March 2024, the Supreme People's Court and the Supreme People's Procuratorate disclosed that from August 2020 to February 2021, the medical representatives of a company in Beijing Chaoyang Emergency Hospital of Integrated Traditional Chinese and Western Medicine and other places fabricated the positive results of patients' genetic tests, so that patients could be reimbursed and prescribed drugs through medical insurance, resulting in an expenditure of more than 80,000 yuan from the medical insurance fund. This medical representative can get a commission of 200 to 300 yuan for every box of lung cancer drugs sold.

Zhu Meng, a member of the medical insurance system who has long been concerned about genetic testing fraud, told Southern Weekend that some high-priced anti-tumor targeted drugs have been included in the medical insurance, and the condition for reimbursement by medical insurance is that the relevant genetic test results are positive, and patients can use medical insurance to prescribe drugs, but some people deliberately change the negative results to positive.

"After changing to positive, the patient can use the medical insurance to prescribe targeted drugs, which is called blind matching in medicine, and there is no right medicine, but it may not be bad, anyway, the medical representative sold the drug and took a commission, and the medical insurance fund suffered losses. Zhu Meng said.

On April 16, 2024, the National Health Insurance Administration said frankly in its interpretation of the "2024 Special Rectification Work Plan for Violations of Laws and Regulations in the Medical Insurance Fund" that with the increase in supervision, the behavior of "fake patients, fake illnesses, and fake bills" has decreased significantly, and it is more manifested as "true and false interweaving", mixing false diagnosis and treatment with real medical needs. The recently launched special rectification in 2024 will continue to focus on six major areas such as inspection and inspection.

Remediation makes "half of the companies that do genetic testing run"

One of the most well-known cases of falsification of such genetic test reports is that in early 2022, a number of AstraZeneca staff members were suspected of tampering with test results to fraud and defraud, and the National Health Insurance Administration named and exposed them, and ordered a nationwide verification and special rectification.

On January 29, 2022, the National Health Insurance Administration disclosed on its official website that according to the clues reported by the masses in the early stage, the National Health Insurance Administration urged Shenzhen to set up a joint task force composed of medical insurance, public security, health care, market supervision and other departments, and interviewed AstraZeneca for internal investigation and rectification, and urged employees to voluntarily surrender if they had similar behaviors. On February 10 of the same year, the Shenzhen Medical Insurance Bureau issued a relevant case report, arrested 17 people involved in the case, and all of them took criminal coercive measures in accordance with the law.

Southern Weekend reporters learned from the National Health Insurance Administration that after the case, the National Health Insurance Bureau, together with the Ministry of Public Security and the National Health Commission, carried out a nationwide special rectification of the tampering with genetic test results to defraud the medical insurance fund. The Shenzhen Medical Insurance Bureau and the Shenzhen Health Commission also issued a document to strengthen the management of genetic testing for individualized treatment of tumors, and put an end to the occurrence of non-standard sampling and testing, false testing, tampering with test reports, and other behaviors that affect medical quality and safety, and fraud and hedging.

Sichuan Province acted earlier. At the end of July 2022, the Medical Insurance Bureau of Shunqing District, Nanchong City, Sichuan Province, issued a document on its official WeChat account, pointing out that the district extracted 254 copies of all the application materials for restricted payment drugs that required genetic testing reports from September 2018 to December 2021, made more than 312 phone calls, sent more than 60 letters, and inquired more than 190 relevant medical staff. After verification, a total of 6 people's genetic reports were falsified, involving an amount of 161,132.9 yuan, all of which have been handed over to the public security organs.

Zhu Meng's prefecture and city have also carried out rectification, "almost half of the local companies specializing in genetic testing have run away, and people who used to be chaotic did not dare to come."

However, in the early stage of rectification, two major problems were encountered: first, the medical insurance department did not report and did not have data; second, the verification was difficult and costly, and the medical insurance department lacked professional testing equipment. Zhu Meng said that starting in the first half of 2022, all local patients on targeted drugs will need to submit a copy of the genetic test report to the relevant departments for the record, so as to facilitate sampling and verification. At the same time, the professional laboratory helped the medical insurance department review the report at a test cost price close to 1,000 yuan per case.

"When the health insurance department finds that there are problems with two patient reports from the same company, it will notify the hospital, and the company's report may not be credible, and the health insurance department will also hand over the clues to the public security organs. Zhu Meng said that the report is randomly inspected every once in a while, which is a deterrent to lawbreakers.

Up to now, the judgment document network has published a number of criminal judgments of AstraZeneca medical representatives tampering with genetic test results to fraud and defrauding insurance, and the fraud has touched Hubei, Henan, Zhejiang and other places, and the medical insurance fund has suffered a cumulative loss of more than 210,000 yuan. Before going to press, a reporter from Southern Weekend clicked on the link to the company's official website for AstraZeneca's self-inspection and rectification announced by the National Health Insurance Administration, and found that the link was no longer visible.

Strictly investigate the chaos of delivery

"This was my first exposure to genetic testing in my life. Recalling the two genetic tests that his father did after he was diagnosed with cancer in 2021, Shen Mo still has a feeling of being deceived - both times were recommended by hospital doctors to genetic testing companies, and samples were sent out for testing. Thankfully, the results of the two tests were consistent, and Shen Mo did not receive a single false report.

Cui Liang, a medical industry analyst at the Toubao Research Institute, told Southern Weekend that due to the high cost of genetic testing laboratory equipment and other reasons, NGS genetic testing is mostly carried out in third-party testing institutions, and the testing cost is higher than that of traditional tumor genetic testing technologies such as PCR technology.

In the past one or two years, various localities have begun to issue documents to regulate the business of genetic testing hospitals and strengthen the supervision of sample delivery.

In September 2023, Hunan Province issued the "Hunan Provincial Medical Institutions Sample Delivery Testing Management Specifications", which lists five prohibited acts, including strictly prohibiting medical institutions from sending clinical testing items that can and are suitable for their hospitals to third-party testing institutions for testing, and strictly prohibiting employees of medical institutions from privately accepting rebates and commissions given by external inspection agencies in any name and form. Similar documents have been issued in Shanghai, Sichuan, Jiangsu, Shanxi, Shaanxi and Fujian.

It is worth noting that for the first time at the national level, sample delivery has been included in the annual national medical supervision and random inspection plan. On March 26, 2024, the General Department of the National Bureau of Disease Control and Prevention, the General Office of the National Health Commission, and the General Department of the State Administration of Traditional Chinese Medicine issued a document proposing to strengthen supervision and law enforcement in key areas such as medical expenses, medical insurance settlement, out-of-hospital drug purchases and testing, and severely crack down on issues such as the issuance of false medical certificates.

Han Xiaochen said that after her mother suffered from lung cancer, in 2015, she did four tests in the pathology department of a tertiary hospital in Beijing, including PD-1, PD-L1, microsatellite instability and mismatch repair gene mutations, although the coverage is not as large and comprehensive as the large and comprehensive high-throughput NGS test, but the total self-paid part is only 98 yuan. After the mother's drug resistance progressed, she did a single gene test in a cancer hospital in Beijing, and paid 200 yuan after being reimbursed by medical insurance.

Compared with doctors' private recommendations and sample delivery, Han Xiaochen believes that the cooperation of hospital in-hospital testing or public inspection of selected testing institutions can reduce the risk of non-standard or fraudulent genetic testing sampling and analysis to a certain extent, especially for higher-level hospitals with higher standards for business quality control, and stricter requirements for cooperative testing institutions and their practitioners.

In fact, some scholars have long analysed the legal regulation of direct-to-consumer genetic testing. Ten years ago, Jiao Yanling, a professor at the Law School of Tianjin Normal University, published a paper suggesting that the regulatory authorities should clarify the content of their responsibilities, standardize the operation process of genetic testing, clarify the access conditions of testing institutions and testing personnel, and strengthen supervision.

"Out-of-hospital genetic testing is a highly specialized and accurate analysis, which is both commercial and medical in nature, and also involves the patient's rights and interests such as knowledge and privacy. Therefore, regulation and supervision must be coordinated by multiple departments such as health and market supervision, and there must be evidence-based, but the current legislation on genetic testing is still missing. On April 14, Jiao Yanling said in an interview with Southern Weekly.

(Shen Mo, Zhu Meng, and Zhao Xiaoai are pseudonyms in the article)

Southern Weekly reporter Huang Sizhuo and Southern Weekly intern Wei Yaqi

Editor-in-charge: Cao Haidong