Wisconsin AG announces $29 million payment by Pharmacia toward judgment

MADISON, Wis. (Legal Newsline) - Wisconsin Attorney General J.B. Van Hollen announced Wednesday that Pharmacia Corporation paid $29,453,247 to partially satisfy a judgment entered against it for alleged Medicaid fraud.

In 2004, Van Hollen's office filed a lawsuit against Pharmacia, a Pfizer Inc. subsidiary, and 35 other drug manufacturers alleging violations of the state's Medicaid fraud statute and Deceptive Trade Practices Act. The drug manufacturers allegedly inflated their reported drug prices to increase the reimbursement amount for pharmacies from Wisconsin Medicaid.

In 2009, a jury found Pharmacia liable for Medicaid fraud and violations of the Deceptive Trade Practices Act. The court ordered Pharmacia to pay more than $22 million. The Wisconsin Court of Appeals and the Wisconsin Supreme Court affirmed the findings after three years of appeals.

After accounting for statutory interest, the $22 million trial court judgment grew to more than $32 million. Pharmacia disputes the interest calculation and paid only $29 million. Further litigation will address the disputed difference.

"This is great news for Wisconsin taxpayers," Van Hollen said. "Pharmacia's payment helps make the taxpayers whole for its fraudulent drug-pricing scheme against the Medicaid program. This also is a resounding affirmation of our contention that Pharmacia and some other pharmaceutical companies falsely inflated the prices of their prescription drugs. Their scheme defrauded the state and its taxpayers, increased employer healthcare insurance premiums, and raised the costs of prescription drugs for the uninsured."

On Aug. 1, the Wisconsin Supreme Court dismissed a petition for review from Pharmacia and remanded the lawsuit for further proceedings. Van Hollen said the ruling will allow the remaining claims against more than 20 other drug manufacturers to move forward.

"Every Wisconsin court that has been presented with the facts regarding the pharmaceutical companies' fraudulent drug pricing scheme has found in favor of the state," Van Hollen said. "Now that the stay has been lifted against the remaining defendants, we're another step closer to getting the state reimbursed for the overpayments it made for the falsely overpriced drugs."