Corporate Compliance

Walgreens to pay $35 million to settle fraud claims

Compliance Monitor, June 11, 2008

Walgreens Co. will pay $35 million to settle fraud and abuse claims. Between 2001 and 2005, the company illegally switched prescriptions to more expensive versions in a scam to defraud Medicaid.

According to a Department of Justice (DOJ) release, Walgreens allegedly switched:

  •  150 mg or 300 mg tablets of Ranitidine to more expensive capsules
  •  10 mg or 20 mg capsules of Fluoxetine to more expensive tablets
  •  5 mg tablets of Eldepryl to more expensive capsules

According to the DOJ, changing capsules to tablets, and vice-versa, allowed Walgreens to receive more reimbursement from Medicaid without improving care to the patients.

The $35 million will be divided among federal agencies as well as 48 states and Puerto Rico to pay for separate settlements. Bernard Lisitza, a licensed pharmacist who blew the whistle on the alleged abuse, will receive $5 million for the False Claims Act qui tam action he filed in 2003.

The OIG also announced that Walgreens will enter into a five-year Corporate Integrity Agreement to ensure no future incidents occur. Click here to read the corporate integrity agreement.


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