3rd Circuit Upholds Medicaid Fee Ruling
The 3rd Circuit Court of Appeals upheld a Pennsylvania federal court ruling dismissing a whistleblower suit brought by several states against nine drug companies alleging that they underpaid rebates to the states under the Medicaid Drug Rebate Program. The appeals court decision says the central issue was whether the companies knowingly violated the False Claims Act by excluding certain credits they received from their customers in calculating a drug’s “average manufacturer price.” The district court concluded that excluding the credits was a reasonable interpretation of the applicable rebate program statutory provisions and granted the companies’ joint motion to dismiss the suit. The 3rd Circuit upheld the lower court decision.
The drug companies were: Allergan, Amgen, Bradley Pharmaceuticals, Eisai, Mallinckrodt, Novo Nordisk, Reliant Pharmaceuticals, Sepracor, and Upsher-Smith Laboratories.