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Three companies face US fraud lawsuits

Published on 24/10/03 at 05:46pm

Three pharmaceutical companies, GlaxoSmithKline, Pharmacia and Aventis, face legal action for alleged bribery and inflation of prescription drug prices in the US.

New York State Attorney General Eliot Spitzer has filed lawsuits against GlaxoSmithKline and Pharmacia alleging they agreed payments with doctors and pharmacists to persuade them to prescribe their drugs.

Mr Spitzer said Aventis would shortly face similar charges, with the total amount of the claims expected to run into tens of millions of dollars.

The case centres on the average wholesale price (AWP) of drugs as reported to US Government health plans, such as Medicare. It is alleged that the pharma companies inflated the AWP in relation to the price charged to doctors, allowing them to pocket the difference.

All three companies have vowed to defend the charges in court and deny any illegal pricing practices.

GlaxoSmithKline says the state is trying to blame the companies for flaws in its own reimbursement system for doctors and pharmacists.

"Those who designed and administered the New York [health plans] have known for decades that tying reimbursements to AWP causes the programmes to pay doctors and pharmacies more for certain drugs than the doctors and pharmacies paid for the medicines themselves", a GSK spokesman said.

Similar cases have also been filed in Texas, West Virginia and Nevada, as well as by regional units of the US Justice Department.

The New York case, along with many of the others, concerns cancer drugs and treatments to help people deal with the side-effects of chemotherapy.

The drugs named in the New York case are Pharmacia's Camptosar and Adriamycin; GSK's Zofran, Hycamtin and Navelbine; and Aventis' Taxotere and Anzemet.

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