The state of Texas and two former AstraZeneca LP employees have filed suit against the pharmaceutical giant in a Texas state court, accusing the company of cheating the state’s Medicaid program by fraudulently marketing powerful antipsychotic drugs and paying kickbacks to doctors and state officials. In their suit, filed last month, the state and former AstraZeneca sales specialists Allison Zayas and Tracy Miksell-Branch contend that the company misrepresented the efficacy of Seroquel IR and Seroquel XR, downplayed the drugs’ side effects and promoted their unauthorized use to treat children.
AstraZeneca also allegedly paid a pair of state officials $465,000 to ensure the drugs were included on a list of pharmaceuticals approved for use in the state hospital system, which would make them eligible for later Medicaid reimbursement. “As a result, AstraZeneca obtained the benefit of virtually unfettered Medicaid reimbursements for Seroquel IR and Seroquel XR on the basis of fraudulent and unlawful misrepresentations, and in doing so, AstraZeneca violated [the Texas Medicaid Fraud Prevention Act] and Texas common law,” the suit says.
Texas says that AstraZeneca targeted the state’s Medicaid program after concluding that patients with bipolar disorder or schizophrenia are likely unable to afford Seroquel and will turn to public health programs. Understanding the need to obtain significant government buy-in to achieve their financial goals for the Seroquel franchise, defendants set their sights on Texas Medicaid, according to the complaint. Among other things, the lawsuit alleges that AstraZeneca forced its sales representatives to minimize the risks associated with Seroquel and market unsubstantiated benefits and impermissible uses of the drug to maximize profits.
The complaint alleges that AstraZeneca paid “sham promotional speaking fees” to two state mental health officials with the power to influence formulary decisions in the state hospital system. It was stated:
This conduct continued into 2009, when defendants were able to obtain a formal recommendation from one of the AstraZeneca-paid state mental health officials to request addition of Seroquel XR to the [Department of State Health Services] formulary.
AstraZeneca is no stranger to states pursuing the company for its illegal sales and marketing practices, considering it was a central player in the nationwide AWP litigation. Our firm was the recognized leader in that litigation.
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