International Pharmaceutical Company To Pay Over 323,000 Dollars To State Medicaid Program For Engaging In Unfair Business Practices

Main Category: Medicare / Medicaid / SCHIP
Also Included In: Pharmacy / Pharmacist;  Medical Malpractice / Litigation
Article Date: 13 Feb 2008 - 4:00 PDT

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Attorney General Martha Coakley's Office reached a settlement agreement with Aventis Pharmaceuticals, Inc.(Aventis), an international drug company headquartered in Bridgewater, NJ, to resolve claims that the company engaged in improper price reporting and marketing practices. Aventis has agreed to pay the Commonwealth and the Massachusetts Medicaid Program over $323,000 as a result of the settlement. The Massachusetts payment is part of a national settlement, involving 38 other states, that has returned a total of $22.7 million in funds to the federal and state Medicaid programs.

The national investigation focused on allegations that Aventis reported false and fraudulent Average Wholesale Prices (AWPs) to national price reporting services, resulting in inflated Medicaid reimbursement levels for its prescription medication Anzemet. The drug is used in conjunction with oncology and radiation treatment to reduce patient nausea. From September 1, 1997, through June 30, 2004, Aventis allegedly "marketed the spread" of Anzemet in order to increase both its share of the national health care market for anti-nausea medications and its profits. The "spread" is the difference between the amount paid for drugs by health care providers (such as pharmacies, hospitals and medical practices) and the amount such providers are reimbursed by Medicaid for dispensing or administering the drugs. Under the scheme, the government alleges, providers would bill Medicaid for Anzemet at improperly inflated prices and retain the spread.

Under the terms of the national civil Medicaid settlement, Aventis has also agreed to the terms of a Corporate Integrity Agreement, which requires the company to submit to strict scrutiny of its marketing and price reporting practices and will ensure the company's future compliance with all applicable laws and regulations.

Massachusetts Attorney General Martha Coakley