Idaho AG announces $1 million drug pricing settlement

By Bryan Cohen | Feb 8, 2013

BOISE, Idaho (Legal Newsline) - Idaho Attorney General Lawrence Wasden announced a $1 million drug pricing settlement Thursday with a prescription drug manufacturer to resolve allegations of reporting an inflated average wholesale price for prescription drugs.

Under the terms of the settlement, Abbott Laboratories will pay $1 million to the state to reimburse taxpayers for excessive prices Idaho Medicaid paid for prescription drugs. Approximately $243,000 will be deposited in the state's General Fund and approximately $606,000 will be deposited into the Cooperative Welfare Fund. Approximately $50,000 will go to the Consumer Protection Account.

In 2007, Wasden sued multiple prescription drug manufacturers, including Abbott, to recover taxpayer money for excessive prices Idaho Medicaid paid for prescription drugs. Until July 1, 2011, Idaho Medicaid primarily used average wholesale price as reported by drug manufacturers as a basis for determining the estimated acquisition cost of a drug for the reimbursement of pharmacies. Abbott and the other drug manufacturers allegedly used an inflated number for the reported average wholesale price.

In 2003, Abbott allegedly reported an average wholesale price that was 26 percent higher than the actual average wholesale price for its prescription drug Biaxin.

"When a manufacturer reports an inflated or false average wholesale price for a drug, taxpayers pay too much for that drug through Medicaid reimbursements," Wasden said.

Abbott admitted no liability or wrongdoing in the matter.

Including Thursday's settlement, Wasden's office has recovered more than $27 million in average wholesale price settlements with 37 drug manufacturers. A case against one remaining defendant drug company scheduled for trial in December.

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