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Pfizer, Pharmacia Found Guilty of Medicaid Fraud

This is a settlement for the Consumer and Financial Fraud lawsuit.

Pharmacia, a subsidiary of the pharmaceutical company Pfizer, was found guilty by a Wisconsin jury yesterday of repeatedly committing Medicaid fraud with the state.

The lawsuit, brought by the Wisconsin Attorney General J.B. Van Hollen, alleged that Pharmacia had inflated the wholesale prices of several of its drugs for many years. One example given states that Pharmacia sold the drug Adriamycin, used to treat breast cancer, for $33.43 but listed the wholesale price as $241.36. In some cases hospitals and doctors benefited from the price difference, as the it was used as an financial incentive for doctors to purchase Adriamycin.

The verdict could cost Pfizer/Pharmacia $153 million in fines payable to the state of Wisconsin, as the jury ruled that the company had committed Medicaid fraud more than 1.4 million times over a 10 year period, with each violation carrying a minimum fine of $100, up to a maximum of $15,000.

According to Van Hollen this could net the state at least $144 million, unless a settlement is reached prior to the judge setting fines. Pfizer was also ordered to pay $9 million in compensatory damages to the State.

Pfizer, which acquired Pharmacia in 2003, said they are planning to appeal the verdict.

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Published on Feb-18-09


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