Drugmakers to pay $4.2 million in Wisconsin Medicaid case

NEWS IN BRIEF — Posted April 25, 2011

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Three drug manufacturers accused of defrauding the Wisconsin Medicaid program will pay the state more than $4.2 million, according to a settlement announced March 28 by state Attorney General J.B. Van Hollen.

Merck & Co., Schering Corp. and Warrick Pharmaceuticals Corp. were among 36 drugmakers charged with fraud in 2004 by the Dept. of Justice. The drug companies were accused of publishing false average wholesale drug prices, knowing that the state would rely on the numbers to set its Medicaid payment formulas, Van Hollen said. The inflated prices resulted in Medicaid paying more for drugs than was appropriate, he said.

The three drugmakers did not admit any wrongdoing in the settlement.

In 2009, a jury verdict against manufacturer Pharmacia awarded the state $9 million in damages. Pharmacia appealed, and lawsuits against several other manufacturers have been stayed pending the appeal's outcome. Eleven drugmakers have settled with the state, agreeing to pay about $15 million in combined settlements.

Note: This item originally appeared at

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