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Attorney General Recovers $38 Million from Drug Companies Charged with Fraud

Louisiana Attorney General Buddy Caldwell announced today that his office has recovered $38 million from eight pharmaceutical companies that he sued alleging unlawful inflation of drug costs paid by Louisiana taxpayers through the Medicaid program. Caldwell has made it a priority to aggressively pursue the recovery of taxpayer-funded Medicaid program dollars and has recovered more than $176 million since taking office.

“I will, as Attorney General, continue to aggressively pursue pharmaceutical companies who defraud our Medicaid program. We are sending a message to drug companies that their fraud will not be tolerated in Louisiana,” Caldwell said.

The eight companies will pay Louisiana a combined total of $38,035,000 for 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 Prices or AWPs.

“Earlier this year, DHH took a stand – we said, ‘enough is enough’ with Medicaid fraud and abuse,” said Department of Health and Hospitals Secretary Bruce D. Greenstein. “Stealing from Medicaid deprives Louisiana’s most vulnerable residents of critical health care services and steals from the hospitals and doctors who provide care. We are determined to continue our program integrity efforts to protect the taxpayer money invested in the Medicaid program and the services it provides.”

These latest AWP settlements come as a result of Caldwell’s 2010 lawsuit against 109 drug manufacturers in the case of State of Louisiana v. Abbott Laboratories, and the related State of Louisiana v. McKesson Corporation case filed last year. 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. So far, 13 defendant companies and their subsidiaries have settled with the state for a combined total of $65.2 million in AWP-related recoveries. Judge Wilson Fields of the 19th Judicial District Court has scheduled the first trial against the remaining defendants to begin in August of 2013.

Listed below are the eight companies who will pay a combined total of $38,035,000 million:

Teva Pharmaceuticals USA, Inc. and Barr Pharmaceutical, Inc.
AstraZeneca Pharmaceuticals and MedImmune, LLC $10,000,000.00
Amgen, Inc. $ 2,500,000.00
Fougera Pharmaceuticals, Inc. (formerly Nycomed US, Inc.) $ 2,000,000.00
Baxter International, Inc. and Baxter Healthcare Corporation $ 1,250,000.00
Warner Chilcott Corporation $ 1,050,000.00
Wockhardt USA, LLC and Morton Grove Pharmaceuticals $ 1,000,000.00
 Cypress Pharmaceutical, Inc. $    235,000.00

 The proceeds collected through these settlements will go to Louisiana’s Medicaid program to assist in providing care for its recipients.

Coming soon, the attorney's general office seeks to provide a mechanism by which to take online payments for collections.