Drug wholesaler AmerisourceBergen will pay $625 million to resolve allegations that the company improperly distributed tampered and repackaged drugs, including syringes for cancer patients.
Here are seven things to know:
1. The settlement, announced Oct. 1, resolves civil liability under the False Claims Act. The lawsuit claimed numerous false claims were submitted to Medicaid for unapproved, defective or contaminated drugs.
2. AmerisourceBergen Specialty Group, a wholly owned subsidiary, separately pleaded guilty to illegally distributing misbranded drugs in September 2017, forking over $260 million in fines at the time.
3. The claims were brought against the company from its alleged repackaging and distribution practices at its subsidiary between 2001 and 2014.
4. At the Alabama subsidiary, drug vials — including the overfill — were emptied into plastic containers and repackaged into syringes. The overfill is the extra amount of drug beyond the labeled dose that is contained in each vial. By emptying the overfill into the plastic container, the company created more doses than it purchased from the manufacture. In addition, the company avoided opening some of the vials and sold them to other customers, according to the Department of Justice.
5. The scheme enabled the company to bill multiple healthcare providers for the same vial of drug, which caused Medicare and Medicaid to pay for the same drug twice. In addition, the scheme also allegedly enabled Amerisource to leverage various product discounts to obtain new customers and retain existing customers to increase its market share.
6. The scheme was brought to the attention of prosecutors by former COO Michael Mullen, a whistle-blower at the company, according to The Wall Street Journal.
7. "[Amerisource] placed corporate profits over patients’ needs, endangering the health of vulnerable cancer patients," said U.S. Attorney Richard Donoghue. "This settlement, and the substantial penalty [Amerisource] has agreed to pay, reflect this Office’s firm commitment to protecting those in need of healthcare and holding to account those who put the health and safety of patients at risk."