Fourteen years after Illlinois' attorney general accused Teva of defrauding Medicaid with inflated pricing, the company has agreed to pay $135 million to wrap up the allegations.
The settlement stems from a 2005 lawsuit Attorney General Lisa Madigan filed against Teva and 46 other pharma companies, alleging the drugmakers fraudulently published inflated average wholesale prices that went into calculating Medicaid reimbursement rates. As a result, taxpayers overpaid for Teva drugs, the suit argued.
A Teva spokesperson declined to comment further on the lawsuit.
Since filing the suit, Madigan has recovered more than $436 million in settlements from various companies, according to her office. Litigation is still moving forward against nine drugmakers.
The settlement helps Teva put one challenge in the rearview mirror as it heads into 2019 with other overhangs. For one, the company is involved in an industrywide generics price-fixing probe, along with Mylan and other generics players. Other challenges include a massive restructuring at Teva and an overall tough environment in generics pricing.
But this week at the J.P. Morgan Healthcare Conferece in San Francisco, Teva CEO Kåre Schultz said generic pricing challenges have stabilized, and that Teva’s investors can expect predictability moving forward after a few rough years.