Drug Companies To Pay State $3.4M In Fraud Settlement
Four drug companies have agreed to pay the state $3.4 million to settle claims that they violated the False Claims Act and caused Medicaid to overpay for their products, according to Attorney General Martha Coakley's office.
The settlement is part of a $124 million national settlement negotiated by the National Association of Medicaid Fraud Control Units in cooperation with state fraud investigators. Other states involved include New Hampshire, Ohio and New York.
According to prosecutors, Mylan Pharmaceuticals Inc., UDL Laboratories Inc., AstraZeneca Pharmaceuticals LP and Ortho McNeil Pharmaceuticals Inc. violated Medicaid rebate agreements, which dictate that companies must pay rebates to state Medicaid programs.
The companies involved in the settlement allegedly misclassified drugs as generic when they were in fact brand name drugs, causing state Medicaid programs to be paid less in rebates than they should have been.
Mylan and UDL paid $118 million in the settlement and were accused of misclassifying more than 50 drugs manufactured by other companies. AstraZeneca agreed to pay $2.6 million and Ortho McNeill agreed to pay $3.4 million.
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