Ala. asks for $800M from GSK, Novartis

Alabama stuck an $800 million suggested price on its Medicaid fraud case against GlaxoSmithKline and Novartis. In closing arguments yesterday, the state asked jurors for that multimillion-dollar award as repayment for the drugmakers' alleged overcharging for Medicaid drugs--and to send a message to other pharma firms. "We won't tolerate a reimbursement shell game," the lead prosecutor said.

According to the state, GSK and Novartis charged the Medicaid program more for meds than they did other customers from 1991 to 2005. Medicaid is supposed to get the drugmakers' lowest offered price.

The companies, however, say they've done nothing wrong. According to Novartis's attorney, the federal government requires drugmakers to report list prices that don't include discounts. "It is not fair to punish Novartis for doing what the federal government says for us to do," he said.

The two drugmakers are among 70 companies sued in Alabama for Medicaid drug fraud, and this is the second case to go to trial. In February, a jury told AstraZeneca to pay $215 million to the state, but Judge Charles Price, who's also presiding over this second trial, lowered the award to $160 million.

- read the Associated Press article