Watson Pharmaceuticals Inc. has agreed to pay Louisiana $8.5 million to settle allegations that it defrauded the state’s Medicaid program by artificially inflating its wholesale drug prices. The resolution came on Tuesday just before state attorneys were to give opening statements before a 12-person jury in Louisiana’s 19th Judicial District Court.
Louisiana Attorney General Buddy Caldwell initiated the complaint against Watson Pharmaceuticals, alleging the company had defrauded taxpayers and the state’s Medicaid program by violating the Louisiana Unfair Trade Practices and Consumer Protection Act and Louisiana’s Medical Assistance Programs Integrity Law.
“We are prepared to present these fraud cases to Louisiana juries,” Mr. Caldwell said. “Louisiana will not tolerate fraud being perpetrated on its Medicaid program. We have numerous other fraud cases currently pending against other pharmaceutical companies, and we are proceeding to recover funds wrongfully taken from this state.”
Louisiana’s Department of Health and Hospitals praised the Attorney General’s office for its efforts in fighting fraud against the state’s taxpayer-funded health care programs.
“The Attorney General’s Office has been an invaluable partner in fighting Medicaid fraud,” said Department of Health and Hospitals Chief Compliance Officer William Root. “Inflating the costs of prescription medications for Medicaid patients is wrong, plain and simple. I am confident our partnership with the Medicaid Fraud Control Unit is essential to protecting how and when we spend Louisiana tax dollars to care for those who need it most.”
Watson Pharmaceuticals became a part of Switzerland-based Actavis Group in January. Actavis Inc. is a developer and manufacturer of generic drugs, brand-name drugs, and biosimilar products. The company has offices in Parsippany, N.J., and Zug, Switzerland.