Damages deemed too high in AstraZeneca fraud case
Pharma Compliance Alert, June 25, 2008
AstraZeneca lost its bid to have a fraud verdict in Alabama overturned, but the judge did rule the punitive damage award against the company was too high, according to an article in the Global Edition of the New York Times.
In its February 21 verdict, the jury said AstraZeneca must pay $40 million in compensatory damages and $175 million in punitive damages for alleged false and misleading reporting of drug prices reimbursed by the Alabama State Medicaid Agency. Circuit Judge Charles Price reduced the punitive damages to $120 million, making the total judgment to $160 million. The company had argued the total judgment be no more than $86 million.
AstraZeneca is one of 73 pharmaceutical companies sued by Alabama Attorney General (AG) Troy King in 2005 for allegedly overcharging the Alabama State Medicaid Agency. Dey and Takeda Pharmaceuticals collectively agreed to pay $6.75 million to settle with the AG. Novartis Pharmaceuticals and SmithKline Beecham Corp., are currently on trial in the litigation in Montgomery
Pharmaceutical companies are facing similar lawsuits in other states, including Mississippi, South Carolina, Utah, Hawaii, and Alaska.
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