Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Walgreen, Par Accused of Plot to Overcharge for Generic Drugs

Don't Miss Out —
Follow us on:

Jan. 13 (Bloomberg) -- Walgreen Co., the biggest U.S. drugstore chain, and generic drugmaker Par Pharmaceutical Cos. were accused in a lawsuit of swapping prescription-drug tablets for more expensive capsules to boost profits.

“Walgreen’s and Par engaged in at least two widespread schemes to overcharge insurance companies, self-insured employers and union health and welfare funds,” the United Food & Commercial Workers Unions & Employers Midwest Health Benefits Fund said in a complaint filed Jan. 11 in federal court in Chicago.

The drugs involved included generic versions of Zantac and Prozac, according to the complaint. The fund and other third-party payers paid millions of dollars more for the capsules than they would have for the correctly prescribed tablets, said the fund, which is seeking to sue on behalf of all third-party payers in the U.S. from 2001 to 2006.

The companies’ actions violated federal racketeering laws, according to the complaint. The fund is asking for unspecified cash damages.

Vivika Panagiotakakos, a spokeswoman for Deerfield, Illinois-based Walgreen, declined to comment on the filing.

In 2008, Walgreen agreed to pay $35 million to settle claims by the U.S. and 42 states that it was overcharging state Medicaid programs for ranitidine -- a generic form of the antacid Zantac -- and for fluoxetine, a generic form of the antidepressant Prozac.

Whistle-Blower Lawsuit

The Chicago case relies in part on that accord, which ended a 2003 whistle-blower lawsuit as well a lawsuit filed against the drugmaker in 2006.

The media relations department of Woodcliff Lake, New Jersey-based Par didn’t immediately reply to an e-mailed request for comment on the suit after regular business hours yesterday.

The case is United Food and Commercial Workers Unions and Employers Midwest Health Benefits Fund v. Walgreen Co., 12-cv-00204, U.S. District Court, Northern District of Illinois (Chicago).

To contact the reporter on this story: Andrew Harris in Chicago at aharris16@bloomberg.net

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

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.