Feds, group of states join suits against Wyeth

John O'Brien May 19, 2009, 2:26pm

WASHINGTON (Legal Newsline) - Sixteen states and the Federal Government are joining in two whistleblower suits filed against prescription drug manufacturer Wyeth.

The suits allege Wyeth failed to give the government the same discounts it gave private purchasers of its products and avoided paying hundreds of millions of dollars in rebates due to state Medicaid programs for the drugs Protonix Oral and Protonix IV.

Those drugs are used to suppress stomach acid. The states that have joined the lawsuit, filed in federal court in Massachusetts, are: California, Delaware, the District of Columbia, Florida, Illinois, Indiana, Louisiana, Massachusetts, New York, Michigan, Nevada, New Hampshire, Tennessee, Texas, Virginia and Wisconsin.

The lawsuits say Wyeth offered discounts to thousands of hospitals for the two drugs from 2000-2006. The discounts were offered to those hospitals that purchased the drugs together in a bundle, and the hospitals that placed both products on their formularies and attained certain market share requirements received a discount of up to 94 percent on the oral drug and 80 percent of the intravenous drug, the suits say.

From there, Wyeth failed to pass along the benefit of the lowest prices to the state Medicaid programs, which are largely funded with federal dollars, the suits say.

"Our complaint charges that Wyeth created the Protonix bundle so they could increase their market share at the expense of the Medicaid program -- a program to provide the least advantaged Americans with necessary medical care and services," said Tony West, U.S. Assistant Attorney General for the Civil Division.

"By offering massive discounts to hospitals, but then hiding that information from the Medicaid program, we believe Wyeth caused Medicaid programs throughout the country to pay much more for these drugs than they should have."

From Legal Newsline: Reach John O'Brien by e-mail at john@legalnewsline.com.

More News