Aventis agrees to $95 million settlement over drug pricing

Chris Rizo Jun. 10, 2009, 1:28pm

Rob McKenna (R-Wash.)

WASHINGTON (Legal Newsline)-The drugmaker Sanofi-Aventis SA. has agreed to pay $95.5 million to settle claims that it overcharged state health care programs by knowingly misreporting prices for its nasal sprays.

The settlement with all 50 states and the District of Columbia comes after federal investigators found that between 1995 and 2000 Aventis Pharmaceutical Inc. profited by knowingly misreporting "best prices" for three steroid-based anti-inflammatory nasal sprays: Azmacort, Nasacort and Nasacort AQ.

In accepting the settlement, the Bridgewater, N.J.-based company said in a statement that it has admitted to no wrongdoing. Aventis Pharmaceutical Inc. is a wholly owned subsidiary of Sanofi-Aventis U.S. LLC.

"Although the company believes (Aventis Pharmaceutical Inc.) acted in accordance with the law at the time, the company elected to resolve this legacy matter through this settlement, without admitting any wrongdoing," Sanofi-Aventis said in a statement.

The U.S. Justice Department said that $49 million of the settlement will be paid to the federal government, while more than $40 million will go to the states, and $6 million will go to public health care providers.

Federal law requires pharmaceutical companies to report to the government the best prices for their drugs and give those rates to state-administered, federally funded Medicaid.

"This is a substantial recovery for our Medicaid program, which was overcharged by Aventis," said Washington Attorney General Rob McKenna. "The settlement once again demonstrates that we aggressively pursue those who attempt to siphon tax dollars away from a fund that provides health care for children, seniors and those with disabilities."

In a statement, the Washington attorney general's office said Aventis licensed the three nasal sprays to be sold by the health maintenance organization Kaiser Permanente under its private label to avoid reporting the best price that would have forced the company to pay millions of dollars to Medicaid.

From Legal Newsline: Reach staff reporter Chris Rizo at chrisrizo@legalnewsline.com.

More News