Drug fraud cases close, state gets $238 million payback

Louisiana Attorney General Buddy Caldwell announced Wednesday the successful conclusion to a three-year effort against more than 100 pharmaceutical companies and their subsidiaries that fraudulently raised drug prices paid by Louisiana taxpayers through the Medicaid program.
He said a total of $238 million will be paid back to the state.
In the final settlements announced in court Monday, 25 companies and their subsidiaries agreed to pay the state approximately $88.4 million. These final settlements, added to those previously announced over the three-year litigation period, bring the total amount recovered to $238,139,268.
“These companies took advantage of the state and its taxpayers by fraudulently over-pricing and marketing prescription drugs, thereby forcing the state’s Medicaid program to grossly over-pay for those prescriptions,” said Caldwell. “This kind of success sends a clear message to companies that don’t do business honestly. Louisiana is a pro-business state. If you play fair, come to Louisiana and do business on a level playing field. And if you don’t, stay away or suffer the consequences,” he added.
“In order to provide critical services to Louisiana citizens, those who work with our Medicaid program must be responsible actors – pharmaceutical companies are no exception,” DHH Secretary Kathy Kliebert said. “I hope that this settlement, as with previous ones successfully reached by the Attorney General’s office, sends a message to companies that they cannot charge the state more for necessary prescription medications than is appropriate. We have no tolerance for fraudulent charges made to the Medicaid program.”
Monday’s settlements bring an end to Caldwell’s 2010 lawsuit against 109 drug manufacturers in the case of State of Louisiana v. Abbott Laboratories, consolidated with State of Louisiana v. McKesson Corporation. The pharmaceutical companies named in the suit are accused of misreporting drug price information in order to improperly increase reimbursements paid by Louisiana’s Medicaid program. The Medicaid reimbursements are based on what is called Average Wholesale Price (AWP). The suit accuses the defendants of committing fraud and violating the Louisiana Unfair Trade Practices and Consumer Protection Act and Louisiana’s Medical Assistance Programs Integrity Law.
This AWP litigation was handled jointly by Louisiana Department of Justice in-house Assistant Attorneys General Nick Diez and Keetsie Gunnels and outside contract expert counsel led by Dee Miles of the Beasley Allen Law Firm. The state did not pay any attorneys’ fees to outside counsel in conjunction with this case. Nineteenth Judicial District Court Judge Wilson Fields presided over the case.
Listed below are the 25 companies who agreed to pay a combined total of $88,401,941.50 on Monday:
Abbott - $6,200,000
Alcon - $1,000,000
Apotex - $4,000,000
Astellas - $1,130,000
Aventis - $7,000,000
Bayer - $1,300,000
Biovail - $200,000
Brenn Distribution (Qualitest/Propst) - $800,000
Eisai - $1,000,000
Eli Lilly - $1,650,000
Forest - $3,000,000
Gilead - $250,000
Johnson & Johnson - $10,000,000
Lupin - $750,000
Novartis - $7,000,000
Ostuka - $121,941
Par - $6,000,000
Pernix - $800,000
Perrigo - $2,000,000
Ranbaxy - $5,000,000
Sandoz - $13,100,000
Shire - $4,000,000
Takeda/Tap - $3,750,000
Taro - $5,000,000
UCB - $3,350,000