Criminal Prosecution of Bristol-Meyers Squibb Company

Bristol-Myers Squibb Company and its generic division, Apothecon, paid the United States $328 million to resolve a broad array of allegations involving illegal drug pricing and marketing activities. BMS and Apothecon agreed to pay an additional $187 million to State governments based on the same allegations. The civil settlement resolves allegations that (1) BMS and Apothecon set and maintained inflated prices knowing that federal health care programs used these prices for reimbursement, and then marketed the "spread"โ€“ the difference between the reported price used by Medicare to set reimbursement rates and the price charged to customers โ€“ to induce sales by increasing providers' profits; (2) BMS paid kickbacks to doctors in the form of bogus consulting fees to induce them to purchase BMS's drugs; (3) BMS paid kickbacks to wholesalers and retail pharmacies to induce purchases of generic products; (4) BMS promoted its atypical antipsychotic drug, Abilify, for juvenile use and to treat dementia related psychosis โ€“ uses that were not approved by the Food and Drug Administration (FDA); and (5) BMS violated the Medicaid Drug Rebate Act, 42 U.S.C. ยง 1396r-8, by reporting false "best prices" to the government for its drug Serzone, which resulted in BMS underpaying quarterly rebates owed to the Medicaid program.

Source: HHS Health Care Fraud and Abuse Control Program, Annual Report for FY 2007

This article was posted on July 15, 2012.

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