Part 10: Novartis USA: Novartis Face Alabama Fraud Lawsuit

April 19th, 2008

The Alabama Supreme Court has ruled that Glaxo and Novartis won’t get separate trials in a lawsuit claiming they inflated prices paid by the state Medicaid program. The state’s lawsuit says the drugmakers overstated the average wholesale price used to calculate state Medicaid reimbursement rates to pharmacies. Alabama has sued 70 companies over similar allegations, and in February, won a $215 million jury award against AstraZeneca.
The drugmakers argued for separate trials because they face different claims and will employ different defenses. The trial is now slated for June 16 in Montgomery County Circuit Court. Alabama Attorney General Troy King called the Supreme Court ruling “good news for the people who depend on Medicaid to provide important medical services. Now we are going to more quickly determine if these companies took advantage of the state,” King tells the Associated Press. “Obviously, if we’ve got to have 70-something separate trials it would take a lot longer and be more complicated.”
Three years ago, King filed suit over prices for Medicaid recipients. Beyond the trial with AstraZeneca, which is appealing, Dey and Takeda Pharmaceuticals agreed to settle and, collectively, pay $6.75 million. Jere Beasley, a former lieutenant governor whose law firm helped engineer the Vioxx settlement, is representing Alabama in court.


 http://www.pharmalot.com/2008/04/glaxo-and-novartis-face-alabama-fraud-suit/