Drug Manufacturer Fraud Litigation, Fraud - Tuesday, November 8, 2011 14:39 - 0 Comments

An Update On The AWP Verdict In Mississippi

As we reported in the last issue, our law firm, led by Dee Miles and Clay Barnett, tried a case on behalf of the State of Mississippi and obtained a $38.2 million verdict against pharmaceutical giant Sandoz, Inc. The lawsuit was based on Sandoz’s allegedly publishing inflated “average wholesale prices” that the Mississippi Division of Medicaid used to reimburse pharmacists for drugs. These inflated prices caused Mississippi’s Division of Medicaid to overpay pharmacists, a marketing scheme designed by Sandoz to sell more drugs in the State of Mississippi than its competitors. For the uninformed, “AWP” stands for “average wholesale price” and was the fraudulent price reported to Mississippi by Sandoz, Inc.

As is customary, Sandoz filed post-trial motions with the court asking the judge to throw out the verdict for various reasons and to reduce the amount of punitive damages and penalties awarded against Sandoz. On October 4th, Judge Thomas Zebert denied Sandoz’s motions relating to the compensatory damage award of $23, 661.618.00. He also affirmed the $2,699,000.00 civil penalty awards against Sandoz for violations of Mississippi’s Consumer Protection Act. Thus, the court has affirmed and left intact $26,360,618.00 in damages for the state.

In addition, the court had previously assessed punitive damages against Sandoz in the amount of $11, 830,809.00, based on what the court described as “punishment for fraudulent conduct” by Sandoz in its dealings with the State. As is routine in punitive damage award cases in Mississippi, the court must now hold a hearing to determine the fairness of the amount of punitive damages awarded by the court. Post-trial hearings to evaluate the assessment of punitive damages are common in all states. Mississippi has a statutory requirement for a post-trial hearing. As a result, a final judgment will not be entered in this case until an evidentiary hearing concerning the fairness of the punitive damages has been concluded. We will promptly update our readers on developments in this most important case for the State of Mississippi and taxpayers in that state.