MONTGOMERY, ALA. – After winning three cases against drug manufacturers, the State of Alabama has requested that the 69 companies in the remaining lawsuits be settled. Initially, the State Medicaid Agency sued 72 drug manufacturers for falsely reporting reimbursement drug prices to the State. Two companies settled with the State. The three companies that have been tried have each been found guilty of fraudulent conduct by Montgomery County juries. The first case against Astrazeneca resulted in a $215 Million verdict, which was reduced after post-verdict hearings to $160 Million by the trial judge. The second trial resulted in verdicts totaling $114 Million against Glaxo-Smith-Kline and Novartis Pharmaceuticals Company. Jere Beasley, the lead attorney for the State of Alabama, stated in a news conference:
“Attorney General Troy King is contacting all of the remaining drug manufacturers which have been sued by the State of Alabama and will give each of them an opportunity to settle all claims against them. All of these cases involve intentional fraud committed by each of the companies. Their conduct has cost the State of Alabama over One Billion Dollars in overpayments to the Medicaid providers. When you consider that the Medicaid program is designed to benefit the poor, the elderly, children, and disabled persons, the conduct by the drug companies is unconscionable. These companies believe they can cheat the State Medicaid Agency, which is underfunded and understaffed, and get away with it. They have also believed in the past that if eventually caught, nothing would be done to them. Those days are over.
The time has come for all of these cases to be settled promptly without further delay. The defendants will have a thirty day window in which to make an acceptable settlement offer. After that time, there will be no further settlement negotiations by the State. We are currently in settlement talks with a number of the defendants and believe that others will join the discussions. Those who don’t settle will face trials in Montgomery County Circuit Court.”
The next companies to be tried are Bristol Myers Squibb Company, Sandoz, Inc., and Abbott Laboratories, Inc. The case is set before Judge Charles Price on October 27, 2008.