Kansas AG Six Sues Drug Companies for Allegedly Overcharging Medicaid

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Kansas Attorney General Steve Six announced Friday that he is sueing thirteen drug companies. He accuses them of unlawfully inflating drug costs paid by Kansas taxpayers through the Medicaid program.

In the lawsuit, Six says the pharmaceutical companies deliberately misreported drug price information in order to increase reimbursements made by the Kansas Medicaid program. Medicaid is the state-federal health care program for the poor.

“We believe Kansas has lost millions of dollars as a result of these drug companies’ fraudulent pricing schemes,” Six said in a statement. “We allege that the drug manufacturers deliberately inflated the reported Average Wholesale Price—or AWP—and other wholesale prices for their drugs in order to increase market share for their products. This is a disturbing abuse of the Medicaid reimbursement system.”

Six said the scheme caused taxpayers to grossly overpay for prescriptions covered by the Kansas Medicaid program. According to Kansas’s lawsuit, the Kansas Medicaid program spent over $160 million on prescriptions drugs in the past year alone.

Six said that other states have brought similar lawsuits and the federal government has also been investigating drug manufacturer pricing practices.

Six filed the complaint in Wyandotte County District Court. It accuses the defendants of violating the federal Medicaid statute, breach of contract, violating the Kansas Consumer Protection Act, fraud, and unjust enrichment. The suit asks the court to permanently prohibit the alleged illegal practices, and it seeks recovery of damages, penalties, and costs.

The Defendants in this lawsuit are: Takeda Pharmaceutical Company Limited, Abbott Labs, Wyeth, TAP Pharmaceutical Products, Inc., Schering Plough, Purdue Pharma LLP, Mylan Labs, Forest Labs, Boehringer, GlaxoSmithKline, Johnson & Johnson, Alza Corporation, Janssen Pharmaceutica Products, LP, McNeil-PPC, Inc., Ortho Biotech Products, LP, Ortho-McNeil Pharmaceutical, Inc., DEY, Inc., and EIisai.