Some Drug Companies Are Defrauding Taxpayers

Actavis Paying Damages for Price Inflation

Actavis has become the most recent drug manufacturer ordered to pay millions in damages after defrauding taxpayers through the Medicaid program.  A Texas jury concluded that the company had been artificially inflating the cost of its products since 1991.  The company has been ordered to pay $170.3 million in damages.  The state’s case against Actavis stems from a whistleblower lawsuit that was filed by a Florida-based pharmacy called Ven-a-Care.  The Texas Attorney General’s office has investigated multiple drug manufacturers to determine if they are inflating the cost of their products to the Medicaid program.

Actavis Settles; Other Firms Involved in Similar Suits

While the Actavis trial was the first of its kind in Texas, similar cases have been investigated and millions of dollars have been successfully recovered through pre-litigation settlements.  Teva Pharmaceuticals settled in July for $51 million and Par Pharmaceuticals is scheduled to face trial in May.  Both of these companies are based in New Jersey.  Action against Watson Pharmaceuticals in California is still pending.

How Drug Companies Take Advantage of Taxpayers

The wholesale price paid by drug companies is only a small fraction of what these drug companies actually claim, per the Department of Justice.  The difference is a large profit for drug companies, at the expense of taxpayers.  With millions of taxpayer dollars at stake, these companies need to be thoroughly investigated and held accountable for their actions.  Unfortunately, public outrage and legal action may be the only way to hold these companies accountable for their actions.

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