PA Receives Half Million Dollar Settlement

$42 million multi-state settlement with pharmaceutical company; PA to receive more than half million

HARRISBURG – Pennsylvania today received more than $580,000 as part of a $42 million multi-state settlement with a Delaware-based drug manufacturer accused of offering and paying illegal compensations to induce health care practitioners to prescribe their drug.

The drug manufacturer’s alleged actions caused thousands of false or fraudulent claims to be submitted to the Medicaid program.  Medicaid programs nationwide will receive approximately $19.2 million of the total settlement.

Attorney General Tom Corbett said the multi-state agreement was reached between 49 states, the District of Columbia and Alpharma Inc. From January 2000 through December 2008, Alpharma sponsored Advisory Boards to allegedly entice health care professionals, including physicians and nurse practitioners, to participate in their program by funding the attendees’ cost for luxurious trips and events at popular, upscale destination locations.

Corbett said that Alpharma allegedly offered and paid for training programs, consulting forums, research grants and speakers’ bureaus in an effort to increase prescriptions of Kadian, a sustained release morphine sulfate product used to manage moderate to severe pain.

Corbett said that the investigation revealed that, in general, doctors wrote a significantly greater number of Kadian prescriptions after attending such meetings.

Additionally, the investigation revealed that Alpharma allegedly misrepresented the safety and efficacy of Kadian to doctors in order to promote its use beyond its Food and Drug Administration (FDA) indication.

“There is a clear distinction between making a profit and profiteering,” Corbett said.  “This case represents an illegal attempt to cheat a system designed to help elderly and low income citizens obtain affordable health care.”

Corbett said the investigation was initiated by a lawsuit filed under the qui tam provisions of the False Claims Act. This action is pending in the United State District Court for the District of Maryland.

Pennsylvania will share the $580,554 with the federal government. More than $254,000 of the money will be used for the state’s Medicaid Program. Medicaid is funded jointly by the federal and state governments.

Corbett said the investigation was led by a five state group including, Arkansas, Florida, South Carolina, Texas and Vermont and the U.S. Department of Justice and the National Association of Medicaid Fraud Control Units.