AstraZeneca to Settle Idaho Medicaid Drug-Price Claims for $2.5 Million

AstraZeneca Plc (AZN) agreed to pay $2.5 million to settle Idaho’s claims related to the reported average wholesale prices paid for drugs by the state’s Medicaid program.

The settlement is intended to reimburse taxpayers for excessive prices that the state paid for prescription drugs as a result of inflated average wholesale price reporting, Idaho Attorney General Lawrence Wasden said today in a statement. AstraZeneca denied any wrongdoing.

“AstraZeneca has competed responsibly with respect to pricing and marketing of our medicines, and we firmly believe that we have acted at all times in accordance with the law, Laura Woodin, an AstraZeneca spokeswoman, said today in an e- mailed statement. “This agreement was the appropriate way to resolve this matter quickly and allow the company to focus on our core mission to deliver meaningful medicines to patients.”

For one drug, there was a 26 percent difference between the published price and the actual price, according to Wasden’s statement.

“Where published prices are false or misleading, the taxpayers are significantly harmed by excessive Medicaid reimbursements,” Wasden said in the statement.

States and municipalities have sued dozens of drugmakers seeking to take back millions of dollars in prescription drug payments that they say were obtained through the reporting of inflated average wholesale prices, or AWP.

AWP was used by government health programs including Medicare and Medicaid to set reimbursement rates for drugs. Drugmakers say the posted prices aren’t the actual costs of pharmaceuticals.

AstraZeneca, based in London, is appealing a $20.5 million judgment over Kentucky’s Medicaid program. A state court judge in January denied the company’s request for a new trial and refused to overturn a 2009 jury verdict that the drugmaker had inflated the prices of its prescription drugs.

To contact the reporter on this story: Sophia Pearson in Philadelphia at spearson3@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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