Settlement Reached in Medicaid Drug Inflation

$84 million awarded

Wednesday, Dec 28, 2011  |  Updated 4:42 PM CDT
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Settlement Reached in Medicaid Drug Inflation

Settlement reached in Medicaid drug suit (Pills shown are not the same drugs discussed in the settlement)

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Texas has reached an $84 million settlement with a prescription drug maker convicted of inflating drug prices to the Medicaid program.

State Attorney General Greg Abbott said the agreement averts lengthy appeals after a Travis County jury verdict in February. Prosecutors argued Actavis Inc. inaccurately reported its prices, leading Medicaid to overpay pharmacies.

CEO Doug Boothe said Wednesday his New Jersey-based company was pleased to resolve the case and would continue to report prices legally and under terms of the agreement.

The lawsuit followed a whistleblower suit filed more than 10 years ago by a small pharmacy in Florida and was the only one of several similar cases to reach a jury.

About $30 million of the settlement gets returned to the Texas treasury after legal fees and federal reimbursements.

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