Ala. AG Presents $1 Million to Medicaid Agency

Attorney General Troy King recently presented a check for $1,070,923 to the Alabama Medicaid Agency in funds awarded from the settlement of a lawsuit alleging antitrust violations regarding the anti-anxiety drug buspirone hydrochloride, marketed under the brand name of BuSpar.

“I am delighted that we were able to recover this money. The Alabama Medicaid Agency has the important task of providing health care to many who otherwise would do without. They do so under tremendous financial pressure,” said King. “The Attorney General’s Office is entrusted with a serious responsibility as a steward of the taxpayers’ money. I am proud of my staff for the record we have compiled in the recovery of funds due to state agencies, especially agencies like Medicaid. “

In fiscal year 2004, the Attorney General’s Office of Consumer Affairs and Medicaid Fraud Control Unit recovered $3,731,728 to the Alabama Medicaid Agency.

The Alabama Attorney General joined 50 other states, the District of Columbia, and Puerto Rico in settling a lawsuit that was filed in December of 2001 in U.S. District Court in New York against Bristol-Myers Squibb Co.; Watson Pharma Inc.; and Danbury Pharmacal Inc. The civil complaint alleged that Bristol-Myers, makers of BuSpar, engaged in fraudulent conduct and conspired with a potential competitor to prevent the entry of generic competitors and illegally maintain its monopoly in the United States. The settlement resulted in compensation to state agencies and to consumers for their purchases of the more expensive brand name drug.

Consumers who purchased BuSpar between Jan. 1, 1998 and Jan. 31, 2003, were eligible for compensation of a portion of the overcharges for the drug. Under the terms of the settlement, consumers who filed claims and provided proof of purchase before the deadline of Oct. 10, 2003, received partial refunds. As a result of the settlement, 1,399 Alabama consumers received compensation totaling $960,377 from the settlement administrator last July.

Generic alternatives reportedly make a significant difference in the cost of drugs. According to a 1998 report from the Congressional Budget Office, the average generic prescription price can be less than half of the brand name price.

King stated that in addition to the $1 million for the Alabama Medicaid Agency, the settlement brought $58,144 in compensation to the Department of Mental Health and Mental Retardation.

“This case sends an important warning to drug companies and other businesses that they must operate fairly and within the law, or they will be called to account and face serious consequences,” said King. “When unfair and illegal practices occur, my office will act to protect the taxpayers’ dollars, as well as those of individual consumers.”