Connecticut has joined a federal-state settlement with AstraZeneca Pharmaceuticals LP and Cephalon Inc. to resolve allegations that the companies inappropriately overcharged state Medicaid programs for drugs. Allegedly, AstraZeneca and Cephalon underpaid drug rebates that were owed to the states.
Under a federal law known as the Medicaid Drug Rebate Programs, drug manufacturers must periodically return a portion of the amount paid by Medicaid programs for manufacturers’ drugs. The purpose of the rebate program is to help ensure that states pay competitive prices for drugs, while the rebates are calculated based on a percentage of the average price drug wholesalers pay for each drug.
AstraZeneca, a London and Delaware-based pharmaceutical manufacturer, has paid the states and the federal government $46.5 million to resolve allegations against the company. Cephalon, a Pennsylvania-based subsidiary of Teva Pharmaceuticals Industries Ltd., has paid the states and federal government $7.5 million to settle similar allegations.
The portion of the settlement attributable to the state and federal shares of Connecticut’s Medicaid program from AstraZeneca is $389,125.06, of which the state share is $180,149.79; plus an additional $20,000.00 for state-only, according to the Connecticut Attorney General’s office. As for Cephalon, they will be responsible for $188,450.34 attributable to CT Medicaid, of which the state share is $95,343.31; plus an additional $25,930.36 for state-only.
Attorney General George Jepsen, Chief State’s Attorney Kevin T. Kane and state Department of Social Services Commissioner Roderick L. Bremby made the announcement.
