States, feds settle with pharma company

Bryan Cohen Feb. 28, 2012, 1:48pm


JEFFERSON CITY, Mo. (Legal Newsline) - Missouri Attorney General Chris Koster announced a $289,000 settlement on Tuesday resolving allegations that KV Pharmaceutical misrepresented that two drugs were approved for federal and state health care coverage.

Under the terms of the agreement, KV Pharmaceutical Company, the St. Louis-based parent company of the now-defunct Ethex Corporation, will pay $17 million in total to the federal government and participating states. The settlement will compensate federal health care programs for Ethex's alleged conduct.

Ethex allegedly misrepresented the regulatory status of Nitroglycerin Extended Release Capsules and Hyoscyamine Sulfate Extended Release Capsules and failed to advise the Centers for Medicare and Medicare Services that the unapproved drugs did not quality for coverage under health care programs on a federal level. As a result of its conduct, Ethex allegedly knowingly caused false claims to be submitted and paid for Hyoscyamine Sulfate ER and Nitroglycerine ER. There has not been any allegation of harm or risk to any patients taking the drugs and neither drug is on the market currently.

"Pharmaceutical companies must be held accountable for their actions," Koster said. "This attorney general's office will continue to place a priority on fighting Medicaid fraud returning these scarce health care dollars to the state."

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