|
Public
Employee Press Court
approves $350 million settlement in drug fraud case
Under a recent federal court ruling against a
price-fixing scheme, the DC 37 Health & Security Plan will seek millions of
dollars for the excessive amounts it paid for drugs on behalf of members and retirees.
On
Aug. 3, the U.S. District Court in Massachusetts approved a $350 million settlement
of a drug fraud lawsuit in which the plan played a leading role.
The $350
million is to compensate consumers, drug plans and self-insured employers who
were victims of a price-gouging scheme involving 386 widely used prescription
drugs.
DC 37 members and retirees cannot get direct compensation, because
they make fixed co-payments regardless of the price of their prescriptions, but
the plan can go after a share of the $288 million that is to be divided among
union benefit funds and self-insured employers.
Our victory put the
pharmaceutical industry on notice that there are watchdogs that are going to bite
them real hard if they use fraud to boost their bottom line, said Cynthia
Chin-Marshall, administrator of the DC 37 plan.
The lawsuit charged that
the drug wholesaler, McKesson Corp., one of the largest U.S. health-care firms,
conspired with pharmaceutical industry publishers to jack up the figures in wholesale
price lists used by retailers to set sales prices.
The rip-off hit popular
drugs such as Allegra, Ambien, Celebrex, Claritin, Coumadin, Lipitor, Plavix,
Prevacid, Prilosec, Valium and Zantac. DC 37 filed the suit with three other union
members of the Boston-based watchdog group Prescription Access Legislation, a
nationwide coalition of senior, labor and consumer groups.
This settlement
is the largest class-action lawsuit on price fraud ever brought against a major
drug company, said attorney Audrey Browne, who represented the union plan
in the case. Hagens Berman Sobol Shapiro, one of the most experienced law firms
in the country in public-interest litigation, worked on behalf of the union plans.
We
are very proud to have fought a successful fight for the interests of consumers
and drug plans, said Browne.
In related litigation involving co-defendants
FirstDatabank and MediSpan, the federal court approved two settlements on March
17 that call for a rollback in the prices of the 386 brand-name drugs in the fraudulent
pricing scheme.
| |