AstraZeneca on Suicide Mission in Drug Pricing Litigation

Last Updated Sep 30, 2009 2:51 PM EDT

AstraZeneca appears to be on a suicide mission in its average wholesale price litigation. Yesterday we saw how it lost a $13 million appeal of a Massachusetts federal court ruling that found AZ illegally marketed the spread between the actual price of Zoladex and its Medicare reimbursed rate, thus bribing doctors, ripping off taxpayers and generating increased sales of the cancer drug.

That turns out to be the tip of AZ's iceberg. The AmLaw litigation Daily notes AZ faces a bunch of state litigation on the same issue:
AstraZeneca doesn't have a great track record in these state AWP suits. In 2008 a state court jury in Montgomery awarded the State of Alabama $250 million in a Medicaid drug pricing fraud case against the pharma company. (The award was later reduced to $160 million and is on appeal.) On the other hand, Kentucky juries may not be as open-handed as Alabama's. Kentucky's previous AWP trial, against Sandoz, resulted in a relatively small $16 million verdict.
Some diligent Google searching reveals this retracted summary of AWP litigation from plaintiffs' lawyer site The Jere Beasley Report. The takeaway is that the states have been pretty successful at extracting either verdicts or settlements, not only from AZ but other companies entangled in fraudulent drug-pricing allegations also:

Alabama verdicts:
  • AstraZeneca â€" $250 Million reduced by the trial court to $160 Million
  • GlaxoSmithKline â€" $81 Million
  • Novartis â€" $33 Million
  • Sandoz â€" $78.4 Million.
In Kentucky:
  • Sandoz - $16 Million
In Wisconsin:
  • Sandoz - $9 Million
Upcoming trials:
  • September: Kentucky v AstraZeneca
  • October: Hawaii v Watson
  • November: Hawaii v Sandoz
  • January: Hawaii v GlaxoSmithKline and Novartis; Wisconsin v J&J.
Mississippi, Kansas, Utah, Texas, and Alaska are also prepping cases, and the federal government obtained two recent settlements from Schering-Plough and Sanofi-Aventis. Beasley adds:
... Alabama has settled with fifteen companies for $124.5 million, the most of any of the litigating states.

Comments

CBSN Live

pop-out
Live Video

Market Data

Watch CBSN Live

Watch CBS News anytime, anywhere with the new 24/7 digital news network. Stream CBSN live or on demand for FREE on your TV, computer, tablet, or smartphone.

Watch Now

Market News

Stock Watchlist

New Android App

For your Android phone and tablet, download the FREE redesigned app, featuring CBSN, live 24/7 news.

Download
The all new
CBS News App for Android® for iPad® for iPhone®
Fully redesigned. Featuring CBSN, 24/7 live news. Get the App