Idaho Attorney General Lawrence Wasden has announced that a $2.5 million settlement has been reached with two drug manufacturers over drug pricing violations. Prescription drug manufacturers AstraZeneca LP and AstraZenaca Pharmaceuticals allegedly reported misleading or false wholesales drug prices. Companies that report false or misleading prices are in violation of Idaho’s Consumer Protection Act.
Along with medical services and care, Idaho Medicaid also pays for prescription drugs. By law, pharmacies are reimbursed for their estimated cost of the acquiring the drugs. The drugs wholesale prices that are reported by various drug manufacturers are used as the basis for determining how much pharmacies are reimbursed. When those prices are falsely reported, Medicaid over pays for prescription medications.
Over $1.5 million of the settlement will be used for the state’s welfare fund and applied toward the next Idaho Medicaid payment from the federal government. More than $620,000 will be deposited into Idaho’s general fund and will be appropriated by the state’s legislature. Another $50,000 will be set aside for the state’s consumer protection account to for reimbursement of legal fees incurred by Wasden.
In 2003, AstraZeneca reported that the average wholesale price for Prilosec was $4.13. Wasden claimed that the actual price in 2003 was $3.29, a difference of 26 percent. Attorney General Wasden said that their investigation have proven that often the reported average wholesale price of a prescription drug is many times not related to the actual wholesale cost of the drug. Although neither of the companies admitted any wrongdoing, Wasden voiced his appreciation for their willingness to reach a resolution.
