Medco Will Pay $7.9 Million to Resolve Kickback Allegations Related To Formulary Placement; Follows Astra Zeneca’s $7.9 Million Payout Earlier This Year

Medco Health Solutions Inc., a wholly-owned subsidiary of the pharmacy benefit manager Express Scripts Holding Company, has agreed to pay $7.9 million to settle allegations that it engaged in a kickback scheme in violation of the False Claims Act, the Justice Department announced on Wednesday.  Medco provides pharmacy benefit management (PBM) services to clients who receive subsidies under the Medicare Retiree Drug Subsidy program. PBMs such as Medco act as intermediaries between pharmaceutical manufacturers and third-party payers to administer a plan’s prescription drug benefits. PBMs use the purchasing power of their healthcare plan clients to negotiate lower prices for prescription drugs from pharmaceutical manufacturers. These manufacturers have an incentive to offer discounts to PBMs if that means the company’s drug will be featured on the PBM’s formulary of preferred medicine.  Here, though, the government alleges that Medco solicited remuneration from AstraZeneca in exchange for identifying Nexium as the “sole and exclusive” proton pump inhibitor on Medco’s drug formulary list.  The United States alleged that Medco received some or all of the remuneration from AstraZeneca in the form of reduced prices on other AstraZeneca drugs, including Prilosec, Toprol XL and Plendil.  The United States contended that this kickback arrangement between Medco and AstraZeneca violated the Federal Anti-K...
Source: Policy and Medicine - Category: American Health Authors: Source Type: blogs