BRIEF—Teva in $135 million settlement over inflated pricing

After a 14-year legal wrangle, Illinois Attorney General Lisa Madigan says she has recovered $135 million for the state of Illinois in a settlement with the US subsidiary of Israeli generics giant Teva Pharmaceutical Industries that resolves allegations the drug company inflated the wholesale prices used in setting the rates for Medicaid reimbursements.

The settlement stems from a 2005 lawsuit filed by AG Madigan against 47 drugmakers, including Teva, for deceptive practices related to the Average Wholesale Price (AWP) of numerous prescription drugs.

The Madigan’s lawsuit alleged the drugmakers fraudulently published inflated Average Wholesale Prices, which Medicaid programs used to determine the reimbursement amounts for drugs prescribed to Medicaid patients.

AG Madigan alleged the inflated prices have resulted in the overpayment of drug costs by the state.

“I am pleased that today’s settlement will provide $135 million for the state,” AG Madigan said. “In total, as a result of my 2005 lawsuit, my office has recovered more than $436 million for the state of Illinois from drug companies that engaged in unfair conduct.”

AG Madigan’s lawsuit continues to be litigated against nine remaining manufacturers.