FOR IMMEDIATE RELEASE : Wednesday, October 07, 2015
CONTACT: Sara Rabern (605)773-3215
PharMerica Corporation to Pay $9.25 Million Healthcare Fraud Settlement
PIERRE, S.D – Attorney General Marty Jackley announced today that South Dakota has joined with 43 other states and the federal government and reached agreement with PharMerica Corporation (PharMerica) to settle civil allegations that PharMerica conspired with Abbott Laboratories (Abbott) through a number of disguised kickback arrangements to increase overall utilization of Depakote and to promote misbranded Depakote. The states contend that from January 1, 2001, through December 31, 2008, PharMerica knowingly solicited and received illegal remuneration from drug manufacturer Abbott in the form of rebate agreements that required PharMerica to engage in certain promotional programs, grants, and other financial support. This alleged conduct resulted in false claims to Medicaid and other federal healthcare programs.
PharMerica will pay the states and the federal government a total of $9.25 million in civil damages to compensate Medicaid, Medicare, and various federal healthcare programs for harm suffered as a result of its conduct. The cases were filed under federal and state false claims statutes. The total portion of the settlement amount recovered by South Dakota is $25,067.38, of which $16,456.06 will be retained by the federal government as the federal Medicaid share. The remaining $8,611.32 will go to the state general fund to offset alleged Medicaid damages in this case.
A state team appointed by the National Association of Medicaid Fraud Control Units participated in the investigation and conducted the settlement negotiations with PharMerica on behalf of the participating states. Team members include representatives from the Offices of the Attorneys General for the states of California, Illinois, Massachusetts, Maryland, New York, Ohio, South Carolina and Virginia.
The South Dakota Medicaid Fraud Control Unit and the South Dakota Department of Social Services assisted in recovering the settlement money.