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More Drug Firms Settle

From Milwaukee Journal Sentinel (WI) (March 29, 2011)

March 29--With a $4.2 million payment announced Monday, Wisconsin has reached settlements totaling nearly $13 million in its massive lawsuit against dozens of pharmaceutical companies for allegedly defrauding the Medicaid and BadgerCare Plus programs.

But the settlements reached so far don't reflect the hundreds of millions of dollars at stake in the lawsuit.

"The defendants who have settled have been the smaller players," said Frank Remington, an assistant attorney general with the state Department of Justice's Medicaid fraud unit.

The lawsuit -- filed by former Attorney General Peg Lautenschlager in 2004 -- alleged that pharmaceutical companies reported fictitious prices to manipulate the formula used to determine what Medicaid should pay for prescription drugs.

The U.S. Department of Justice and about two dozen states have filed similar lawsuits, Remington said.

So far, Wisconsin has reached settlements with 10 pharmaceutical companies.

On Monday, Attorney General J.B. Van Hollen announced a settlement in which Merck & Co., Schering Corp. and Warrick Pharmaceuticals Corp. agreed to pay $3.7 million in restitution and $550,000 in costs and fees.

The two companies were bought by Merck. The state's lawsuit against Merck is still in litigation.

Other settlements stemming from the lawsuit include:

--Dey Inc. agreed to pay $2 million in September.

--Boehringer Ingelheim Pharmaceuticals Inc., Boehringer Ingelheim Roxane Inc., Ben Venue Laboratories Inc. and Roxane Laboratories Inc. agreed to pay a total of $7.75 million last April. The companies are affiliates of German pharmaceutical company Boehringer Ingelheim GmbH.

--Baxter Healthcare Corp. agreed to pay $1 million in February 2009.

--Amgen Inc. and Immunex, which Amgen bought, agreed to pay $2 million in December 2008.

In addition, Pharmacia, which is now part of Pfizer Inc., has been ordered to pay more than $22 million in forfeitures, costs and fees after a jury awarded the state $9 million in damages in February 2009.

Pharmacia has appealed the order, and the litigation against the other companies is on hold until the appeals court rules.

The appeals court is expected to issue a decision sometime this summer, Remington said.

The state did not bring the first case to trial until 2009, partly because of the preparation required for a case of this scale. And Remington said the litigation has taken longer than expected -- "much longer."

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Posted: March 2011