Schering-Plough Loses Pricing Lawsuit In Missouri
5 CommentsBy Ed Silverman // October 30th, 2008 // 6:01 pm
UPDATE: The drugmaker agreed to settle by paying $31 million after losing jury trial in which its former Warrick Pharmaceutical generics subsidiary was accused in 2005 of improperly pricing drugs purchased by the state’s Medicaid program, which spent about $15 million over 11 years. Initially, Schering-Plough was ordered to pay $7 million in compensatory damages and punitive damages will be decided tomorrow.
In a brief statement, Schering-Plough vows to appeal the decision, and made a point of noting that two other reimbursement cases were found in its favor.
In November 2007, a federal court in Boston found Warrick Pharmaceuticals was not liable in a class action lawsuit involving average wholesale prices. And in December 2005, a West Virginia jury ruled in its favor in a trial related to reimbursement by West Virginia’s Medicaid program of certain asthma meds sold by Warrick.
However, Schering-Plough failed to note in its statement that a $27 million fine was paid to Texas to settle charges that the drugmaker falsely reported wholesale drug prices to the state and federal Medicaid programs. Last week, Kansas filed a lawsuit making similar charges.
Condor
CafePharma showed an anonymous post earlier today on this — but thus far I have been unable to confirm the amount of the jury verdict:
http://www.cafepharma.com/boards/showpost.php?p=2632726&postcount=1
The CafePharma poster puts the verdict for fraud at $7 million — but the penalty phase is still being deliberated — and might thus be a much larger multiple of this $7 million number. We’ll see.
Perhaps not entirely-coincidentally, Schering has reportedly now blocked all work computer based internet access to CafePharma’s website. Classy. Loosk like the same anonymous source as the verdit, too.
I’ll link both, now on mine — thanks, Ed!
Dan A.
As a Missourian, I am suprised that this occured. The state leans to the right, and the governor, some years ago, deprived nearly 100,000 medicaid patients of needed medical care in order to build additional sports stadiums in the state. The governor of my state also created a special gifting room for pharma lobbyists at the capital. It’s nauseating and pathetic.
Former SP
Improper behavior by Schering-Plough? Shocking! NOT! Just more of the same.
Condor
So much for having the courage of its convictions, eh?
No State AG in any of the other 25 or so states ought to settle for under seven times actual damages, now — it is the largest pharma price fraud settlement in the history of Mizzou!
Ouch.
Anonymous
The punitive damages verdict was $100,000,000.00 according to a juror who wrote a letter to the editor of the St. Louis Post-Dispatch.