Texas Attorney General Reaches Multimillion Dollar Settlement in Medicaid Fraud Case

Texas Attorney General Greg Abbott has reached a multimillion dollar settlement in a Medicaid fraud suit against Par Pharmaceutical. From the KUHF Business Desk, Andrew Schneider has more.

Under today’s agreement, New Jersey’s Par Pharmaceutical must pay a $154 million to resolve enforcement actions filed by Texas and four other states.

Tom Kelly is a spokesman for the Attorney General’s office.

“What the company did, and others like it, was inflate its price reports to the Medicaid program so that pharmacies it did business with would be paid more than they should have by the Medicaid program. It’s as simple as that.”

Roughly half the settlement with Par will be allocated to Texas, with the remainder to be split between Florida, Kentucky, South Carolina and Alaska.

“What the settlement today does is get back to Texas general revenue more than $24 million and to the State as a whole almost $72 million. That would include State [and] Federal governments’ share, the whistleblower’s share and the Attorney General’s attorney fees.”

Texas settled the case against one of Par’s co-defendants, Barr Pharmaceuticals of New York, last year. A settlement with Watson/Schein Pharmaceuticals of California is imminent.

Last March, a Travis County jury returned a verdict against Alpharma and Purepac Pharmaceutical, both of New Jersey, with a judgment of a $182 million. Alpharma and Purepac, now subsidiaries of Switzerland-based Actavis, are appealing the judgment.


Andrew Schneider

Andrew Schneider

Business Reporter

Andrew Schneider joined News 88.7 in January 2011. Since arriving in Houston, he has reported on the many changes wrought on the region’s economy by the revolution in domestic oil and gas production. His non-energy reporting runs the gamut from white-collar crime to cattle ranching. His work has aired on...

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