PBM Medco to pay $155 million false claims settlement
Pharma Compliance Alert, October 25, 2006
Medco Health Solutions, the second largest pharmacy benefit manager in the US, will pay the government $155 million plus interest to settle allegations of soliciting and accepting kickbacks from pharmaceutical manufacturers, submitting false claims to the government, and paying kickbacks to health plans to obtain business, the Department of Justice announced October 13.
The Parsippany, NJ-based firm has also entered into a Corporate Integrity Agreement with the HHS Office of the Inspector General.
The settlement resolves the qui tam action filed in 2003 by former Medco Employee Karl S. Schumann, alleging that the company received kickbacks from pharmaceutical manufacturers to Medco.
Schumann will receive $860,000 as his share of the government's recovery, plus payment by Medco for his attorneys' fees and costs. The company has also resolved a separate investigation by the United States Attorney's Office in Philadelphia, initiated in 2004, into false claims to the Medicare program.
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