US Appeals Court denies AstraZeneca in AWP case

The First Circuit of the US Court of Appeals has upheld an earlier ruling of the trial court in a Massachusetts case against Anglo-Swedish drug major AstraZeneca that concluded the company engaged in unfair and deceptive trade practices by inflating the price of prescription drug Zoladex (goserelin acetate), clearing the way for a national class-action law suit to move forward.

The 98-page ruling affirms a judgment of $12.9 million against the company for violating the Massachusetts Consumer Protection Act. AstraZeneca spokeswoman Laura Woodin said the company is reviewing the appeal decision and considering options.

The ruling also clears the way for a national class-action law suit originally certified by USDistrict Court Judge Patti Saris on September 29, 2008, which was temporarily stayed until the resolution of AstraZeneca's appeal.
The case was originally filed September 2, 2002 and claimed AstraZeneca grossly inflated the price of Zoladex, primarily used to treat prostate cancer, by misstating the Average Wholesale Price (AWP) of these drugs in industry publications.

The published AWP sets the price that consumers, insurance companies and other third-party payers pay for the drug, and the law suit contends that consumers and third-party payers often paid more than market value because of the drug company's deceptive AWP reporting.

In the original trial, the court ruled that many pharmaceutical companies, including AstraZeneca, "unscrupulously took advantage" of the AWP reimbursement system "by establishing secret mega-spreads between the fictitious reimbursement price reported and the actual acquisition costs of doctors and pharmacies."