Wasden, Par settle AWP suit for $1.7M

Keith Loria Mar. 29, 2011, 1:47pm


BOISE, Idaho (Legal Newsline) - Idaho Attorney General Lawrence Wasden announced on Tuesday that he has reached a $1.7 million settlement with a drug manufacturer that allegedly violated the Idaho Consumer Protection Act.

Par Pharmaceutical Cos. allegedly misreported average wholesale prices on some of its products, which resulted in taxpayers paying too much for those drugs through Medicaid reimbursements.

According to state law, Idaho Medicaid is responsible for reimbursing pharmacies at the "estimated acquisition cost" of pharmaceuticals. It reaches to this number by using the average wholesale price reported by drug manufacturers.

When the average wholesale price is reported incorrectly, the whole system is thrown off, Wasden says.

"Where published prices are false or misleading, the taxpayers are significantly harmed by excessive Medicaid reimbursements," Wasden said. "[It was] revealed that the reported average wholesale price often is not related to the actual wholesale price paid for the drug. Misrepresenting the wholesale price is a violation of the Idaho Consumer Protection Act."

Par had allegedly reported an average wholesale price in 2003 of $2.731 for its product Fluoxetine, when it should have been $0.081.

Wasden says the $1.7 million settlement will reimburse taxpayers for the excessive prices Idaho Medicaid paid for prescription drugs as a result of Par's alleged inflated average wholesale price reporting, with over $1 million going to the state's Cooperative Welfare Fund for the state's next payment to Idaho Medicaid. The money will also go towards costs associated with the litigation.

"This settlement provides relief to Idaho taxpayers and brings the matter to a conclusion without the need for continued litigation," Wasden said. "I appreciate that the company was willing to work with my office to reach an appropriate resolution."

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