J.B. VAN HOLLEN
ATTORNEY GENERAL

Van Hollen Cracks Down on Medicaid Fraud

Late in the evening of February 16, 2009 a Dane County jury found that Pharmacia, a pharmaceutical company, was guilty of defrauding Wisconsin's Medicaid program and Wisconsin taxpayers by reporting grossly inflated and fraudulent prices. The jury awarded $9 million for compensatory damages. The court may still award additional forfeitures based on the jury's findings that Pharmacia committed 1,440,000 violations of our Medicaid Fraud law.

This case and the others that will follow are important, foremost, because they are law enforcement actions. Wisconsin law is clear. The only way for the Medicaid system and our consumer protections to work is for companies to follow the law. This verdict reminds them of that obligation.

It further reminds them of another good practice. Tell the truth. Making up numbers to increase profits while taking it out of taxpayers pockets is not acceptable.

While they will likely appeal the verdict, what this verdict importantly accomplished was to bring into the light and hold Pharmacia accountable for practices carried out contrary to Wisconsin law that cost taxpayers and patients alike millions of dollars in unlawfully inflated payments.

It's not news that  Medicaid is struggling to stay solvent.  Hopefully, this victory will help lighten its load as it continues to provide this much needed program to Wisconsin's neediest citizens without the heavy burden of overpayments to pharmaceutical companies. While these companies provide life sustaining drugs and quality of life improvements to many people, they can not be allowed to inflate their profits by defrauding those whom these drugs are meant to help and the taxpayers who bear much of this burden.

While we have reached settlements with three other pharmaceutical companies for similar behavior, this was the first to be presented to a jury in Wisconsin.  With thirty-two other companies still facing similar claims, I expect this verdict will give clear guidance to other companies doing business with Medicaid and selling products to Wisconsin consumers.

Companies must follow the law. Often forgotten is that companies acting outside the law also enjoy this competitive advantage over their competitors when it comes to viability and profits. Not only is it illegal, it is unfair in our capitalist economy.

Thirty-two other pharmaceutical companies await the conclusion of the suit the Wisconsin Department of Justice has brought against them for similar violations. This victory is important and indicates what we and they can expect.

This page created by the Department of Justice. All text, images or associated items are property of the Department of Justice, and may only be reproduced with the consent of the Department of Justice.
DOJ Home | Privacy Policy | Contact DOJ