Drugmaker Mylan and subsidiary UDL Laboratories agreed to pay the federal government and states $118 million to settle a whistle-blower's charge that the companies failed to pay appropriate rebates to Medicaid programs. Ortho-McNeil previously paid $3.4 million and AstraZeneca $2.6 million to resolve allegations from the same False Claims Act lawsuit, filed by a Florida pharmacy in 2004.
Drugmakers agree to $118 million settlement
The agreements stipulate that they do not constitute admissions of liability or wrongdoing.
Congress established the Medicaid Drug Rebate Program in order to make sure that Medicaid gets the best prices for drugs available to private payers.
Drugmakers that accept Medicaid reimbursement agree to pay state Medicaid programs rebates. The rebates are larger for drugs that are considered “innovator” drugs. Ven-A-Care, formerly a pharmacy in Key West, Fla., alleged that the companies dropped the “innovator” designation when they sold drugs made by other companies under distribution deals.
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