$55-million Antitrust Settlement with Pharmaceutical Company over Cancer Drug Reached

Attorney General Ben Chandler today announced a final resolution with Bristol – Myers Squibb Company that would settle a multistate antitrust lawsuit involving the cancer-fighting drug, Taxol.

The Commonwealth of Kentucky, in conjunction with 49 other states and U.S. territories, will recover $55 million to settle the states’ claims for damages, penalties and individual consumer compensation. In addition, Bristol-Myers Squibb has agreed to provide free quantities of Taxol worth approximately $7.5 million, to approved health care facilities, provided recipients meet certain eligibility requirements.

“This is a significant victory for the Commonwealth. This settlement will help to compensate consumers, as well as the Kentucky Medicaid Program, who overpaid for this drug,” said Attorney General Ben Chandler.

Kentucky, along with 31 other states sued BMS on June 4th, 2002 alleging the company violated antitrust laws by engaging in an illegal scheme to protect its monopoly for the cancer-fighting drug Taxol and keep lower-priced generic drugs off the market. Seventeen additional states have joined the settlement. Bristol- Myers Squibb has also agreed to strong injunctive relief for ten years to prevent it from engaging in such anti-competitive conduct in the future.

The settlement was filed today with U.S. Federal District Court Judge Emmet

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$10 Million Medicaid Settlement with Drug Companies

Attorney General Ben Chandler today announced that Kentucky’s Medicaid program will recoup nearly $10 million dollars from a settlement with two major drug manufacturers—GlaxoSmithKline and Bayer Corporation—for violating the federal Medicaid drug rebate law.

The settlement, involving 48 states and the District of Columbia, yielded nearly $330 million dollars total, and is the largest Medicaid fraud case in history. Medicaid is the federal/state health care insurance program that provides health care coverage for the indigent. Kentucky’s Medicaid program, financed with 75% federal and 25% state tax dollars, costs about 3 billion dollars a year.

“Enforcing laws that protect the Medicaid program has and continues to be a priority for my office. This historic agreement is a major accomplishment in that effort, and I am pleased we could recoup these funds at a time when Medicaid is in such desperate need,” said Ben Chandler.

Chandler said the investigation of Bayer and GlaxoSmithKline was initiated after a whistleblower complaint was filed against Bayer in February, 2000. The investigation later expanded to GlaxoSmithKline, and revealed that the drug companies sold several heavily prescribed medications, including Paxil, Flonase, and Cipro to several large Health Maintenance Organizations at deeply discounted prices, repackaging the drugs under

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