First lawsuit was filed in Pennsylvania in 2000 and Nevada in 2005 and was joined by the and all states except Arizona.The suit, a former employee alleged that thepany provided Zocor, the anticholesterol treatment Mevocor and Vioxx to hospitals at discounts of more than 90% if the hospitals helped thepany reach market-share goals.Practice provided an unfair incentive for physicians to prescribe the drugs, the plaintiffs said.Under federal law, drug manufacturers must offer Medicaid the best price that they offer to any customer, but drugs sold at discounts of 90% or more do not need to be disclosed to the government.Exception was intended to allow drugpanies to make less-costly prescription drugs available to charitable organizations.The law does not specify who can receive the undisclosed discounts, the plaintiffs argued that the hospitals could not qualify because they agreed to sell specified volumes, and Merck was essentially using the discount as a marketing tool (Rubenstein/Johnson, Wall Street Journal, 2/8).In addition, the plaintiffs claim that Merck paid physicians so-called consulting or training fees, which were actually kickbacks for prescribing Zocor and Vioxx (Finch, , 2/8).Lawsuit examined violations from 1997 to 2001 at 600 to 800 hospitals nationwide, according to Assistant U.Attorney Viveka Parker and Virginia Gibson, chief of the office's civil division.Merck in a statement did not admit wrongdoing but said that the lawsuit was a result of a misunderstanding ofplex Medicaid rules.That in 2001 thepany implemented new rules for its sales force to prevent such activity from occurring (Stark, , 2/8).Pay $399 million to settle the lawsuit, with $218 million paid to the federal government and $181 million to the 49 states and Washington, D.For the second lawsuit, which involved similar allegations for Pepcid and was originally filed in Louisiana in 1999, Merck will pay $250 million, divided among the federal government and the same 49 states (Wall Street Journal, 2/8).MENTS Merck spokesperson Ronald Rogers said, "What we have here is a disagreement (over) the rules of the Medicaid rebate program," adding, "At the time that these pricing programs were in place, Merck believes that it acted in good faith andplied with the regulations that were in place at the time.Continued, "These civil settlements were the best and most appropriate way to resolve these lengthy investigations" (AP/Houston Chronicle, 2/8).U.Attorney General Michael Mukasey said that the settlement represents "one of the largest health care fraud settlements ever achieved by the Justice Department" and that the government will "hold drugpanies accountable for devising pricing schemes that deliberately seek to deny federal health care programs the same lower prices for drugs that are available to othermercial customers" (Cohen, , 2/8).BROADCAST COVERAGE ABC's "" on Thursday reported on the settlement.Segment includesments from U.Attorney Patrick Meehan and attorney Mark Kleiman, who represents the whistleblower in the case (Thomas, "World News," ABC, 2/7).Of the segment and expanded ABC News coverage are available ."" on Friday also reported on the settlement (Montagne, "Morning Edition," NPR, 2/8).Of the segment is available .Reprinted with kind permission from .Can view the entire Kaiser Daily Health Policy Report, search the archives, or sign up for email delivery at .Daily Health Policy Report is published for kaisernetwork.Service of The Henry J.Family Foundation 2005 Advisory Boardpany and Kaiser Family Foundation.Rights reserved.HOW INTERESTING WAS THIS ARTICLE?Not Very.Read more First-generation antihistamines diphenhydramine and chlorpheniramine reverse cytokine-afforded eosinophil survival by enhancing apoptosis
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