AstraZeneca, Bristol Overcharged on Drugs, Judge Says (Update1)

[Joanne98]

Source: Bloomberg

June 21 (Bloomberg) -- AstraZeneca Plc, Bristol-Myers Squibb Co. and Schering-Plough Corp. must pay damages for overcharging on certain drugs paid for by Medicare, pension funds, insurers and patients, a federal judge ruled following a trial.

U.S. District Judge Patti Saris in Boston found the companies liable in a nationwide class action lawsuit over drugs administered by doctors to patients. She dismissed claims against Johnson & Johnson while giving plaintiffs' lawyers until Aug. 1 to provide damages calculations for the remaining defendants.

The plaintiffs claimed the drugmakers sold medicines to doctors at steep discounts to the ``average wholesale price'' that Medicare and pension funds paid, while secretly encouraging them to claim full reimbursement from insurers. The plaintiffs are seeking hundreds of millions of dollars in damages.

``The Medicare statute itself created a perverse incentive by pegging the nationwide reimbursement for billions of drug transactions a year to a price reported by the pharmaceutical industry, thus putting the proverbial pharmaceutical fox in charge of the reimbursement chicken coop,'' Saris wrote in a 183- page opinion today. ``The different pharmaceutical companies unfairly took advantage of the system by setting sky high prices with no relation to the marketplace.''



Read more: http://www.bloomberg.com/apps/news?pid=20601087&sid=a6KakHaEIu2E&refer=home

[acmavm]

1. I bet they never pay a damn dime. Like EXXON. In Alaska.

They'll find a way out of it.