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medpundit |
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Tuesday, October 29, 2002The settlement will be split between the federal government and the states because Medicaid is a jointly funded program. The charges stemmed from a whistle-blower lawsuit alleging that educational grants by Parke-Davis to the Ochsner Health Plan in 1999 constituted a rebate that lowered the price of the drug for the Louisiana insurer. Federal law requires drug companies to offer the Medicaid program the lowest price paid by any purchaser. The suit was brought in 1999 by John David Foster, who worked for Parke-Davis at the time. Pfizer acquired Parke-Davis through its 2000 takeover of Warner-Lambert. The settlement represents more than double the $21 million the Medicaid program was overcharged, according to Foster's lawyer, Joel Androphy. Foster will receive about $6 million for his role in the settlement, Androphy said. “Educational grants” seems like an awfully broad category, and the health plan presumably used other Pfizer drugs besides Lipitor, so it’s hard to understand how the federal government can justify this as overcharging. I’m much more sympathetic to the pharmaceutical company on this one. Federal healthcare plans like Medicaid and Medicare have a disconcerting tendency to create elaborate rules that no one can understand. There exists a whole industry of consultants who earn a living helping physicians understand the rules so they can avoid being accused of fraud. Yet, put two consultants together and they won’t be able to come to an agreement on the proper interpretation. I’m sure the rules for drug companies are no different. posted by Sydney on 10/29/2002 06:32:00 AM 0 comments 0 Comments: |
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