AmerisourceBergen to pay $625M in drug distribution settlement

Wholesale drug distributor AmerisourceBergen agreed to pay federal and state governments $625 million for illegally distributing misbranded drugs including cancer syringes, New York's attorney general announced Monday.

The civil settlement falls in line with the company's September 2017 guilty plea for distributing the drugs. AmerisourceBergen's now-defunct subsidiary Medical Initiatives shipped plastic syringes filled with cancer drugs to providers in all 50 states, having removed the drugs from their original glass vials. That allowed the company to sell excess product from the original vials, known as "overfill."

But the repackaging took place in an unsterile environment, and combined the contents of multiple vials in a process known as "pooling," despite many of the vials carrying a "single-use" designation.

All in all, state Medicaid programs will receive nearly $100 million from the AmerisourceBergen settlement, according to New York Attorney General Barbara Underwood.

"We have zero tolerance for big corporations that skirt federal and state laws to boost their profits at the expense of vulnerable individuals—such as cancer patients during chemotherapy," Underwood said in a statement. "We'll continue to work with our partners to ensure that laws are enforced and the public is protected from predatory corporate misconduct."

In order to avoid the Food and Drug Administration's regulatory oversight, AmerisourceBergen did not register Medical Initiatives as a repackager or manufacturer with the agency, records show. Instead, the group portrayed Medical Initiatives as a state-regulated pharmacy, exploiting an exemption to the FDA registration requirement that is reserved for legitimate pharmacies, not for manufacturers or repackagers, authorities said.

AmerisourceBergen also paid $260 million to resolve its criminal liability in September 2017.

In April, Modern Healthcare reported on a similar matter involving McKesson Corp. That pharmaceutical distributor was also accused in a whistle-blower lawsuit of repackaging cancer drugs in conditions that weren't sterile.