AstraZeneca will pay $34 million to resolve a lawsuit that alleged the company used illegal kickbacks to induce providers to write prescriptions for products paid for by Texas Medicaid.
The complaint, which was filed under the Texas Health Care Program Fraud Prevention Act (THFPA), claimed that AZ provided free nursing services and reimbursements to healthcare providers “under the guise of non-branded counseling,” Texas said, to influence them to prescribe the company’s drugs.
Many of the prescriptions were covered by Medicaid, Texas said, resulting in “millions of dollars in claims to Texas Medicaid that were tainted by AstraZeneca’s illegal inducements.”
Over the last year, Texas also has filed similar lawsuits against Eli Lilly and Sanofi for providing free nurses and paid third parties who are alleged to have steered patients to those companies’ products. In supplying these healthcare professionals, the companies can manage the care of patients in place of independent physicians.
“I will not allow Big Pharma to misuse taxpayer dollars to put profit ahead of Texans’ health,” Texas Attorney General Ken Paxton said in a release. “My office will continue aggressively pursuing healthcare fraud to protect taxpayer dollars and the integrity of our healthcare system.”
In agreeing to the settlement (PDF), AZ did not admit to wrongdoing. The agreement is the “result of a mutual desire to settle their disputes amicably and to avoid the delay, expense, litigation costs, inconvenience, and uncertainty of protracted litigation,” the settlement reads.
A decade ago, Lilly and Novo Nordisk faced allegations of using similar nursing services and “white coat” sales schemes respectively to influence the marketing of their insulin products.