Mckesson settles with states for $151 million
Mckesson Corp., San Francisco, entered into a $151 million, multistate agreement to settle allegations that it overbilled Medicaid for brand-name drugs. New York and California led the national settlement team that investigated charges that the drug distributor reported inflated prices on 1,400 prescription products, in violation of federal and state laws, according to news releases from New York’s and California’s attorneys general. The team, which represented 29 states and the District of Columbia, also negotiated the settlement agreement. “We did not manipulate drug prices and did not violate any laws,” Mckesson said in a statement. “However, given the inherent uncertainty of litigation, we determined that this settlement was in the best interest of our employees, customers, suppliers and shareholders.” The company in April entered into a $190 million agreement with the U.S. Justice Department to settle the federal portion of the allegations. Officials said at the time that they deny any wrongdoing. New York will recover $64 million from the settlement whereas California will get nearly $23.6 million, according to the news releases. The settlements resolve a 2005 whistle-blower case that charged Mckesson with inflating the average wholesale prices that it reported to First Data Bank, a publisher of drug prices, by as much as 25% between Aug. 1, 2001, and Dec. 31, 2009. States use the First Data Bank pricing data to set reimbursement rates.