Pharmaceutical companies agree to pay Ohio $8.44 million settlement

By Chris Rizo | May 28, 2009

Richard Cordray (D)

COLUMBUS, Ohio (Legal Newsline)-Four pharmaceutical companies have agreed to pay the state of Ohio a total of $8.44 million to settle claims they overcharged the state for drugs, Attorney General Richard Cordray said Thursday.

The attorney general said Abbott Laboratories Inc., Pharmacia Corp., Roxane Laboratories Inc. and Warrick Pharmaceuticals Inc. agreed to settle claims that they reported false and misleading information regarding their wholesale drug prices.

As a result, Ohio's Medicaid Program paid more for drugs that it should have been charged.

Drug companies are required to disclose their pricing schemes to a variety of customers, including pharmacies, wholesalers and distributors. The information is used by the state to determine what Medicaid pharmacies pay for the medications.

Those costs, plus prescription dispensing fees, are then paid to Medicaid pharmacies.

"These companies artificially inflated their drug pricing data, which caused the Ohio Medicaid Program to overpay pharmacies for drugs dispensed to Medicaid recipients," Cordray said. "This is a significant recovery for our Medicaid program, but we're also sending the message that we will insist on fair and honest drug pricing."

To settle claims, Warrick says it will pay $4.3 million, Roxane will pay the state $2.4 million, Abbott agreed to pay more than $1.3 million, Pharmacia Corp. will pay $400,000.

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

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