Pharmaceutical companies take economic-based affirmative action
Florida Subpoenas Generic Drug Makers on Medicaid
Tue Jul 20, 2004 01:34 PM ET
CHICAGO (Reuters) - Florida's attorney general on Tuesday said he subpoenaed six drug makers on suspicion the companies overcharged the state's Medicaid health insurance program for the poor by $100 million.
Attorney General Charlie Crist joins officials in about a dozen other states probing the pricing and marketing of pharmaceuticals in public health programs, as state governments grapple with double-digit health inflation and red ink.
Mylan Laboratories Inc., Novartis AG's Geneva Pharmaceuticals unit, Ivax Corp., Teva Pharmaceuticals Industries Ltd., Watson Pharmaceuticals Inc. and PurePac Pharmaceuticals, a unit of Alpharma Inc., are the companies targeted.
Officials at Watson and Ivax both confirmed they received the subpoena and said they will cooperate.
Ivax said it believes it is in compliance with all laws. Calls to the other drug makers were not immediately returned.
"Pharmaceutical pricing is a priority for attorneys general," Crist told Reuters. "We've noticed some spreads in the pricing that seemed inappropriate."
In general, drug companies must give government programs the best deal on pharmaceuticals. The subpoenas request material to determine if the companies violated the state's false claims act.
Of Florida's $58 billion budget, about $15 billion is spent on Medicaid, Crist added.
