Pharmaceutical Company Settles Suit Alleging Illegal Pricing Scheme For Cancer Patient Medications

Attorney General Eliot Spitzer today announced a settlement with a leading pharmaceutical manufacturer to resolve allegations that the company inflated the price of certain drugs, including medications for cancer patients.

Under the settlement, which was reached in conjunction with a settlement by the U.S. Department of Justice and the National Association of Medicaid Fraud Control Units, GlaxoSmithKline (GSK) will provide over $1 million in restitution to New York's Medicaid program, which represents New York's share of an agreement involving over 40 states for two drugs used in connection with cancer treatment. Additionally, GSK will pay $940,000 to Medicaid for claims relating to payments for an antibiotic.

GSK, under a separate settlement of a private class action suit in federal court in Boston, will also establish a national restitution fund of approximately $40 million to which Medicare consumers in New York and across the nation and the New York Elderly Pharmaceutical Insurance Coverage (EPIC) program may make claims.

"Our lawsuit helped stop a longstanding practice that inflated the cost of drugs for people suffering from cancer and cheated the Medicaid system" Spitzer said. "Today's settlement provides significant restitution for consumers and the Medicaid program." Read more at oag.state.ny.us