Drug company agrees to pay state $1 million
Advertiser Staff
Pharmaceutical company Dey Inc. has agreed to pay more than $1 million to settle claims it overcharged the state for prescription drugs under the Medicaid program.
The case dealt with Dey's reporting of the "average wholesale price," of prescription drugs according to the state attorney general's office.
For example, in 2003 Dey published an average wholesale price of $0.403 for a unit of the asthma drug Albuterol, according to a news release from the attorney general's office. "But the true average wholesale price was $0.043, a market price spread of 838 percent," the release continued.
"We are pleased that Dey voluntarily engaged in discussions with the state to resolve this dispute," Attorney General Mark Bennett said.
"The taxpayers are harmed when the state's Medicaid payments are based on published prices that are false or misleading. I hope that other drug manufacturers will see Dey's action as the proper one and join us in eliminating unfair costs to Hawai'i's taxpayers," he said.
Dey agreed to provide confidential pricing information to Hawai'i's Medicaid program and pay the state $1.15 million in restitution, compensatory damages, attorney fees and costs.
Dey did not admit any liability or wrongdoing.
"We welcome this settlement with the Hawai'i attorney general as a way to resolve all the claims in the pricing litigation brought by the state," said John Kling, senior vice president for legal affairs at Dey, based in Napa, Calif.
Kling said Dey has participated legally and ethically within national and state reimbursement systems.
"When virtually an entire industry is sued — as has been the case with the pricing lawsuits similar to this one in Hawai'i that have been filed around the country by dozens of attorneys general — it indicates that the real issue is not the industry's conduct, but rather the government's own reimbursement system," Kling said in a news release.
"DEY is settling this litigation as a pragmatic solution to avoid the costs of continuing litigation and the vagaries inherent in it," Kling added.
