Pharmaceutical Company Bristol Settles Massachusetts Lawsuit Over Pricing of Drugs

Alleged Overcharging for Prescription Drugs Leads to $13 Million Settlement in Boston

Pharmaceutical fraud harms the Medicare and Medicaid programs–and the citizens who pay for them. Drug companies’ alleged overcharging for prescription drugs has led to fraud investigations and lawsuits by whistleblower attorneys in the past. This week, shortly before trial, pharmaceutical manufacturer Bristol-Myers Squibb Co. reportedly agreed to pay $13 million to resolve allegations that it overcharged for its Taxol cancer medicine and other drugs.

The settlement follows a ruling last month ordering Bristol Myers-Squibb, AstraZeneca Plc and Schering-Plough Corp. to pay damages for allegedly overcharging on drugs by inflating the “average wholesale price” (AWP).

The lawsuit alleged that consumers’ insurance co-payments were inflated under Medicare Part B, through use of average wholesale prices for prescription drugs, including Taxol, that were substantially greater than what the drug manufacturer actually charged doctors and hospitals.

The upcoming trial was to have addressed co-payments for Bristol’s drugs. According to Bloomberg, the drug Taxol produced $1.6 billion in sales in 2000 alone before Bristol lost the patent protection for this drug.

The lawsuit is In Re: Pharmaceutical Industry Average Wholesale Price Litigation, MDL No. 1456, U.S. District Court, District of Massachusetts.

Cheating the public out of scarce health care dollars should be stopped–and whistleblowers are crucial to that effort.