Teva Pays $7 Million To Settle Mass Medicaid False Claims Suit

   DOW JONES NEWSWIRES 
 

Teva Pharmaceutical Industries Ltd. (TEVA) paid $7 million to the Massachusetts Medicaid program to settle a False Claims Act case pending in federal court in Boston.

The generic drug maker and its wholly owned subsidiary, Ivax Pharmaceuticals Inc., are two of 13 drug manufacturers sued by Massachusetts in 2003 on allegations of falsely inflating prices they reported to national pharmaceutical price-reporting services. Ivax was an independent company when the lawsuit was filed.

In agreeing to the settlement, Teva didn't admit any wrongdoing and said its price reporting was consistent with all legal standards.

Massachusetts previously received a total of $7.48 million in settlements with five other defendants: Dey Inc.; Barr Laboratories Inc., which Teva acquired last month; Barr's Duramed Pharmaceuticals Inc. unit; Ethex Corp., a subsidiary of K-V Pharmaceutical Co. (KVB); and Roxane Laboratories, a subsidiary of Boehringer Ingelheim GmbH. The case against six others continues.

The lawsuit accused the companies of pitching their drugs to doctors and pharmacies at prices below the cost they were reporting to the government, touting that the physicians and pharmacies would get to pocket the difference.

The issue has sparked numerous investigations and lawsuits by state and federal regulators alleging that drug companies took advantage of the system over the years.

The Medicaid program pays for certain prescription drugs provided to eligible low-income individuals, including people with disabilities, children and elder citizens.

Teva's shares recently traded at $42.06, down 1.4%.

-By Kathy Shwiff, Dow Jones Newswires; 201-938-5975; [e-mail]

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