Thursday, October 7, 2010

Was the $28 Million Merck Paid In Hawaii "Only The Beginning"?

Much more fullsome coverage, this morning, in the one of the Honolulu papers -- The Star Advertiser -- do go read it all:

. . . .[Hawaii's Attorney General Mark] Bennett said the settlements conclude what may only be a "first phase" of the state's efforts to recover money from what he said were Medicaid prescription drug overcharges. He said his office is "actively considering" another lawsuit and hopes it will be filed before he leaves office in December.

He declined to specify who might be sued and the reasons. . . .

The industrywide practice involved a complicated market for prescription drugs that Bennett and others said was going on for some time before it was detected.

Rick Eichor, one of the Honolulu lawyers retained to handle the litigation, said the practice was first reported when a small pharmacy in Florida filed a whistleblower lawsuit in the mid-1990s about the drug prices.

Other suits subsequently followed as state authorities began learning of the allegedly inflated prices.

Hawaii's lawsuit alleged the companies were inflating prices for 13 years before its filing in 2006. . . .

"[W]e did go after it vigorously, and I think the recovery is a deterrent to this happening again in Hawaii. . . ."

It would seem that there will be a second wave of these suits, then, for post-2006 pricing practices. It would also seem that part of the explanation for the outsized payment here -- for Merck (Pfizer's was much smaller, proportionately, at $8.2 million, especially given that it is the largest public pharma concern in the world, by revenue) -- had to do with the cholesterol franchises (a legacy Schering-Plough operation), and the fact that many tropical Pacific islanders, including Hawaiians, show genetic markers for high cholesterol. And, the medicines legacy Schering-Plough offered for the condition were extremely pricey.

So I guess this is, in part, yet another "Hassan Hangover" item.

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