By: Health Insurance
Submitted: 2009-11-01 11:08:00 | Word Count: 529
Four pharmaceutical companies will pay a total of $124 million nationally including $3.5 million to North Carolina as part of a major Medicaid fraud case, Attorney General Roy Cooper announced today.
Mylan Pharmaceuticals, Inc., UDL Laboratories, Inc., AstraZeneca Pharmaceuticals LP, and Ortho McNeil Pharmaceutical, Inc. agreed to the settlements to resolve claims that they underpaid rebates owed to Medicaid.
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“Running up profits by underpaying Medicaid hurts patients and taxpayers,” Cooper said. “We’ll keep working to uncover fraud and make Medicaid abusers pay what they owe.”
Medicaid is a joint federal-state program that provides health insurance for the poor.
Mylan, UDL, AstraZeneca and Ortho McNeil had agreed to pay quarterly rebates to Medicaid based upon the amount of money that Medicaid paid for each company’s drugs. The precise amount of rebate owed is determined in part by whether a particular drug is considered an innovator drug or a non-innovator drug, with drug companies required to pay a higher rebate amount for innovator drugs.
North Carolina, several other states and the federal government alleged that these drug companies misclassified drugs so that they could pay less in rebates to the Medicaid Program.
Mylan and UDL agreed to pay $118 million to resolve allegations that they underpaid Medicaid rebates for several drugs, including nifedipine extended release tablets, which are used to treat angina and high blood pressure, and Bumetanide, which is used to treat adema. North Carolina will receive more than $3.3 million, nearly $3 million of which will go to fund federal and state Medicaid efforts. Approximately $414,000 of North Carolina’s total will go to the public schools.
AstraZeneca agreed to pay $2.6 million to resolve allegations that it underpaid rebates for Albuterol, a medication used to treat asthma and other breathing disorders. Of North Carolina’s share of $43,590, approximately $37,000 will go to fund federal and state Medicaid efforts in the state, and approximately $6,600 will go to the public schools.
Ortho McNeil agreed to pay $3.4 million to resolve allegations that it underpaid its rebates for Dermatop, which is used to treat skin conditions. North Carolina will receive approximately $216,000, $178,000 of which will go to federal and state Medicaid efforts and $38,000 of which will go to the public schools.
A National Association of Medicaid Fraud Control Units team negotiated with all four pharmaceutical companies on behalf of the 49 settling states and the District of Columbia. Cooper’s Medicaid Investigations Unit and the NC Division of Medical Assistance reached settlement agreements with the four companies on behalf of North Carolina’s Medicaid program.
