Drug & Device News

The federal government and several states have joined two whistleblower lawsuits against drug manufacturer Wyeth. The suits claim that the drug manufacturer, between 2000 and 2006, overcharged Medicaid for the stomach medication Protonix.

By law, drug manufacturers must inform the government of the lowest price at which their products have been offered to others, and they must give the government a rebate of any excess it has paid over that price. According to the Department of Justice release on the case, “Although Wyeth was required under the Medicaid Drug Rebate Program to determine the effective prices paid by hospitals under this arrangement, and to pass along the benefit of the lowest prices to the state Medicaid programs, Wyeth allegedly failed to do so and therefore avoided paying hundreds of millions of dollars to Medicaid in quarterly rebates.” See http://www.usdoj.gov/opa/pr/2009/May/09-civ-483.html. The two whistleblower lawsuits are pending in the District of Massachusetts. The suits claim Wyeth gave deep discounts on intravenous (up to an 80% discount) and oral (up to a 94% discount) versions of Protonix when hospitals bought the two preparations together.