Big Pharma Punished for Price Fixingposted Mon, 20 Dec 2010
U.S. courts are finally starting to hold big pharmaceutical companies accountable for their longtime, underhanded practice of drug price fixing.
Drug companies are currently facing lawsuits in 20 different states for reporting inflated wholesale drug prices.
Companies like Bristol-Myers Squibb and Abbot Laboratories have already agreed to settlements of hundreds of millions of dollars in false claims in recent months.
The government relies on drug manufacturers to honestly report drug prices so that they can set accurate reimbursement rates for Medicaid. For years, Big Pharma has taken advantage of the situation by reporting exaggerated prices for their drugs.
When there’s a difference between the price paid by the government and the actual price of the drug, the profits go to health care providers and pharmacists. This kickback gives them extra incentive to push particular drugs—putting more money in Big Pharma’s coffers.
Since taxpayers foot the bill for Medicaid, drug companies have been pick-pocketing the American public with this elaborate scheme. So far, the Department of Justice has been able to recover over $1.8 billion from drug companies through these settlements.
Find out more:
Drug Makers New Targets for U.S. Fraud Inquiries, Report Says, New York Times
Drugmakers settle healthcare fraud claims for $421M, FiercePharma Newsletter
Many companies inflated drug prices, Idaho says, Idaho Statesman
Pharmaceutical Manufacturers to Pay $421.2 Million to Settle False Claims Act Cases, Department of Justice press release
Posted by Melissa Maki, RxRights