Schering-Plough Corp., the maker of Claritin allergy medicine, agreed to pay $345.5 million in fines and plead guilty to a single federal criminal charge concerning a payment (kickback) to a managed care customer.
The settlement resolves Schering-Plough’s civil liabilities in connections with its illegal and fraudulent pricing of its blockbuster drug, Claritin, U.S. attorney Patrick L. Meehan said in a statement.
“Schering used terms like ‘data fee’ and ‘value added’ as camouflage for what was nothing more than an old-fashioned kickback,” said Meehan. ” This wasn’t a mistake. It was a marketing strategy. The result was that programs created to provide healthcare to the poorest among us were actually paying more for drugs than those who have private health insurance. There is a point at which pursuit of market share crosses the line that separates competition and illegal conduct. This case serves as an example that the consequences of stepping over that line can be costly.”
The investigation into Schering-Plough started back in 1999.
“We are pleased that we are now putting this matter from the past behind us,” said Brent Saunders, senior vice president, Global Compliance and Business Practices, Schering-Plough Corporation. “We are making progress with our corporate strategy to build a new company where quality, compliance and business integrity are at the center of our work.”
The resolution includes the following components: (1) Schering Sales Corp., Schering- Plough Corporation’s sales and marketing subsidiary, has agreed to plead guilty and pay a $52 million fine for violating the Anti-Kickback Act when it paid a kickback to a customer in exchange for preferred treatment for Claritin; (2) Schering-Plough Corporation has agreed to settle its False Claims Act liability and to pay the United States, the 50 state Medicaid programs, and the Public Health Entities $292 million for losses suffered as a result of Schering’s overcharges for Claritin by failing to report its true best price for the drug; (3) Schering-Plough Corporation will enter into a Corporate Integrity Agreement with the Department of Health and Human Services to correct its government pricing and Medicaid rebate reporting failures, Meehan said.
“Drug companies should take notice that they need to be vigilant in verifying the prices they report for drugs,” said Mark B. McClellan, M.D., Ph.D, Administrator for the Centers for Medicare and Medicaid Services. “We will be watching closely to assure the accuracy of the information reported on drug prices and to assure that all business practices are in compliance with federal rules and regulations.”.
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Schering Plough has established its place as a pharmaceutical powerhouse based upon lying, cheating, paying off congressmen and senators and consistently ‘made’ its coporate numbers not through an innovative pipeline or the interests of consumers-but, by suing and cajoling these government representatives into lenghtening their exclusive limited rights to its products. Claritin was off-patent years ago and yet, it ws maintaining Schering’s bottom-line by tying-up generic makers in court for years while they reaped profits. Their entire corporate mission is based upon the lie that they have rights to market brand products based upon congressional influence and they have broken every rule in the book. This is proven by the litigation that they will be fighting for the next 8-10 years or will settle asap to hide their managemnt’s active role-which they call their ‘mission’ to do whatever is necessary to keep their profitable product lines far exceeding the exclusivity rules set down by FDA. I ask, “how do the analyst’s-like Booyah Cramer live with themselves by touting this stock as legitimately worth investing in-when their numbers are made through fraud and twisting, lying and cheating the paying consumer? Is nothing worth fight for? Is it acceptable that your parents and mine will ahve to pay for over-priced brand medicines made by Schering when there are legitimate generic companies being paid by Schering to keep their generics off market-or tying-up these questions in courts and through lobbying their buddies in congress like Hatch-a to offender on their payroll?? How do you purchase stock in Schering knowing that your parents and grandparents will ahve to choose medicine or food because of the way that Schering does-and always will do business?
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