Criminal Prosecutions of AstraZenica

In 2003, AstraZeneca Pharmaceuticals and Zeneca, Inc. (AstraZeneca), a major pharmaceutical manufacturer, pled guilty and agreed to pay $355 million to resolve criminal and civil fraud allegations arising from its marketing of Zoladex, a drug used to treat prostate cancer. As a result of an investigation conducted by the United States Attorney for the District of Delaware, working with the HHS/OIG, the Food and Drug Administration (FDA), the Defense Criminal Investigative Service and the FBI, AstraZeneca pled guilty to violating the Prescription Drug Marketing Act by causing false claims to be filed for Zoladex that was furnished to urologists as free samples. In addition, the company agreed to pay more than $265 million to settle allegations that it caused false claims to be filed with Medicare, Medicaid, TRICARE and the Railroad Retirement Board, and another $24.9 million for failing to pay proper rebates owed to states under the Medicaid Drug Rebate Program. AstraZeneca also entered into a rigorous 5-year Corporate Integrity Agreement (CIA) with the HHS/OIG, under which the company agreed to affirmatively report certain drug prices to Medicare and Medicaid, and to take other steps to promote proper billing practices.

In October 2009, Mylan Pharmaceuticals Inc. ("MPI"), UDL Laboratories, Inc. (UDL), AstraZeneca Pharmaceuticals LP, and Ortho McNeil Pharmaceutical Inc. paid a total of $124 million to resolve FCA allegations that they underpaid their rebate obligations with respect to certain of their drugs. By agreeing to participate in the Medicaid Rebate Program and signing these Rebate Agreements, these companies agreed to pay quarterly rebates to Medicaid that were based upon the amount of money that Medicaid paid for each company's drugs. The precise amount of a rebate is determined in part by whether a drug is considered an "innovator" drug or a "non-innovator" drug. The rebate that must be paid for innovator drugs is higher than the rebate for non-innovator drugs. The government alleged that these companies misclassified their drugs as "non-innovator" to reduce their rebate obligations to Medicaid

In April 2010, AstraZeneca LP and AstraZeneca Pharmaceuticals LP (AstraZeneca) paid $520 million to resolve FCA allegations that they marketed the atypical antipsychotic drug, Seroquel, for uses not approved by the Food and Drug Administration (FDA) and paid kickbacks to doctors. Of the $520 million, $301.9 million was the Federal share and $218.1 million went to states that decide to participate in the agreement. In addition, AstraZeneca entered into a strict CIA with HHS/OIG.

Source: HHS Health Care Fraud and Abuse Control Program, Annual Reporst for FY 2003 and 2010

This article was revised on July 15, 2012.

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