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TRENTON
- Attorney General Anne Milgram announced
that New Jersey will receive an additional
$41,000 in a national civil settlement with
pharmaceutical company GlaxoSmithKline.
GSK previously paid nearly half a million
dollars to New Jersey under the settlement.
GlaxoSmithKline
will make a new national settlement payment
of $4.9 million in connection with allegations
that the company overcharged the Medicare
and Medicaid programs for its prescription
antibiotic Amoxil. The share of that payment
for the New Jersey Medicaid program, which
is jointly funded by the state and federal
governments, is $82,791, of which New Jersey
will receive $41,395.
In
September 2006, GSK paid more than $145
million in damages and penalties to Medicaid
programs across the country to settle such
allegations with respect to its drugs Zofran
and Kytril. The New Jersey Medicaid program
received $900,919, of which the state received
$408,178 plus $64,204 in post-agreement
interest, for a total of $472,382.
According
to Criminal Justice Director Gregory A.
Paw, the Medicaid Fraud Control Unit of
the Office of Insurance Fraud Prosecutor
participated in a national investigation
into allegations that GSK illegally inflated
the average wholesale price for the injectable
forms of Zofran and Kytril, which are used
to prevent or treat nausea, thereby overcharging
both the Medicare and Medicaid programs
from 1994 to 2002. The average wholesale
price for drugs is used by government-sponsored
health care plans to determine the amount
drug dispensers will be reimbursed.
The
settlement required GSK to enter into a
corporate integrity agreement, which obligated
the company to report certified drug price
data to the settling states. During the
last phase of the settlement negotiations,
GSK disclosed that it had engaged in the
same type of conduct with respect to Amoxil.
The new agreement amends the settlement
to resolve the allegations concerning Amoxil
under the same terms.
Director
Paw credited Assistant Attorney General
John Krayniak of the Medicaid Fraud Control
Unit for representing New Jersey in this
settlement along with representatives of
the U.S. Department of Justice and other
state Medicaid Fraud Control Units.
Attorney
General Milgram noted that New Jersey has
a new tool to combat Medicaid fraud. She
explained that on Jan. 14, Governor Corzine
signed the New Jersey False Claims Act,
which took effect on March 14 and which
contains a whistleblower provision to provide
rewards to people, often corporate insiders,
who blow the whistle on fraud.
The
State of New Jersey administers the Medicaid
program through the Division of Medical
Assistance and Health Services and through
the Office of Insurance Fraud Prosecutor’s
Medicaid Fraud Control Unit, which investigates
both criminal and civil Medicaid fraud and
abuse in that program.
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