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Healthy Skepticism Library item: 13022

Warning: This library includes all items relevant to health product marketing that we are aware of regardless of quality. Often we do not agree with all or part of the contents.

 

Publication type: news

AstraZeneca to appeal US Medicaid court ruling
PM Live 2008 Feb 22
http://www.pmlive.com/index.cfm?showArticle=1&ArticleID=6514


Full text:

AstraZeneca (AZ) is to appeal a US court’s verdict that found it guilty of overcharging Medicaid patients for its drug.

Initial claims that AZ levied over-inflated, marked-up prices for prescribed drugs to the Alabama Medicaid system have been upheld and the company faces a substantial fine.

The Montgomery County Circuit Court in the southern state of Alabama ordered AZ to pay $215m, $40m of which is compensatory damages with the remaining $175m being punitive damages.

AZ maintains that it fully complied with the law. “This lawsuit is legally and factually unfounded,” AZ said, and believes that, “serious errors occurred during the proceedings and that the verdict should not be upheld”.

Alabama attorney general, Tory King, filed lawsuits against 70 pharmaceutical companies in 2005 and AZ was the first company to be tried for price related fraud.

Pharmaceutical companies awaiting trail, such as GlaxoSmithKline and Novartis, could see this as an indicator of the potential verdicts to come.

Jere Beasley, lawyer for the state, said: “It’s obvious the pharmaceutical industry has been taking advantage of the federal and state governments and this jury backs up what we’ve been saying – they’ve been cheating.”

Beasley alleges that AZ never provided Medicaid with “honest and accurate” pricing for its medicines but the company’s lawyer, Tom Christian, said that “prices charged the state were barely enough for the pharmacists to stay in business”.

Christian said any judgement against pharma companies that forced lower prices “would make it financially impossible for pharmacists to fill prescriptions for Medicaid patients”.

A similar July 2007 ruling in a Boston (Massachusetts) court case saw AZ, Bristol Myers-Squibb, and Schering-Plough accused of deliberately misleading the public about the severity of price mark-ups.

However, despite consumers, patients, and the state lobbying for compensatory remunerations into the hundreds of millions, analysts at Dresdner Klienwort said: “There will be limited impact for the industry [pharmaceutical] financially”.

 

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Far too large a section of the treatment of disease is to-day controlled by the big manufacturing pharmacists, who have enslaved us in a plausible pseudo-science...
The blind faith which some men have in medicines illustrates too often the greatest of all human capacities - the capacity for self deception...
Some one will say, Is this all your science has to tell us? Is this the outcome of decades of good clinical work, of patient study of the disease, of anxious trial in such good faith of so many drugs? Give us back the childlike trust of the fathers in antimony and in the lancet rather than this cold nihilism. Not at all! Let us accept the truth, however unpleasant it may be, and with the death rate staring us in the face, let us not be deceived with vain fancies...
we need a stern, iconoclastic spirit which leads, not to nihilism, but to an active skepticism - not the passive skepticism, born of despair, but the active skepticism born of a knowledge that recognizes its limitations and knows full well that only in this attitude of mind can true progress be made.
- William Osler 1909