UK-based pharmaceutical company AstraZeneca Plc (AZN) on Friday confirmed that it intends to appeal yesterday's verdict by a state court jury in Alabama, which awarded the state $215 million in damages after finding that the company overcharged the Alabama State Medicaid Agency on its Medicaid drug price.

In a response issued yesterday, AstraZeneca said that it intends to appeal to the Alabama Supreme Court, if the trial court does not reject the verdict, which awarded Alabama $40 million in compensatory damages and $175 million in punitive damages. AstraZeneca believes the lawsuit is legally and factually unfounded and should not be upheld as some serious errors occurred during the proceedings.

The case, which was filed in 2005 by the Alabama Attorney General, includes 73 pharmaceutical manufacturers. The lawsuit alleged that the companies reported misleading and false prices for drugs reimbursed by the State Medicaid Agency and it caused the Alabama Medicaid to reimburse pharmacists too much money on prescriptions filed for Medicaid patients.

Medicaid is a national-state health-care program for poor and disabled people. The US Federal law requires drug makers to give Medicaid the best price they offer to any customer.

Montgomery attorney Jere Beasley reportedly said that AstraZeneca never provided an honest and accurate price for its drugs in the Medicaid programme.

However, AstraZeneca stated that the case was based on a misleading premise and the Alabama Medicaid Agency did not understand how drug prices are established and reported.

The company also said that it currently provides medicines to Medicaid programmes at the lowest price and has fully complied with the law, government guidelines and contracts that govern Medicaid pricing.

According to AstraZeneca, the company and the State Medicaid programme share a common goal of helping people to access the medicines they need. In the last two years, Alabama patients have received more than $25.5 million in savings through the company's prescription savings programmes.

Meanwhile, certain reports suggested that the lawsuit against AstraZeneca was the first to go to trial. As per Beasley, who represented the state in the court, AstraZeneca tried to settle the lawsuit after the jury started deliberations, but the state wanted to hear the verdict.

The state has settled cases with two other companies, Takeda Pharmaceuticals North America Inc. and Day LP. A trial is scheduled for April 7 in the state's lawsuit against drug companies GlaxoSmithKline Plc (GSK) and Novartis AG (NVS).

AZN closed Thursday's trade at $39.68, up $0.50, on a volume of 1.49 million shares.

AZNCF.PK ended yesterday's trade at $39.69, while AZNDF.PK closed at $39.20 on February 19.