PROVIDENCE – Rhode Island’s Medicaid budget is fatter by more than $2.4 million, thanks to the settlement of a lawsuit with Wyeth, a wholly owned subsidiary of Pfizer Inc. The resolution of the settlement claims Wyeth knowingly underpaid rebates owed under the Medicaid Drug Rebate Program for the company’s sales of Protonix Oral and Protonix IV between 2001 and 2006. According to a release from the Office of Attorney General Peter F. Kilmartin, the office sent $2,442,794.84 to Rhode Island’s Executive Office of Health and Human Services for the Medicaid budget.
The funds represent Rhode Island’s portion of the total state/federal Rhode Island settlement, which was $5.4 million. The settlement arose from two whistleblower lawsuits that were filed in federal courts in Massachusetts. Rhode Island intervened in the lawsuits.
“This is a huge windfall for the state’s Medicaid budget and another example of the work our Medicaid Fraud Control and Patient Abuse Unit does to ensure that each Medicaid dollar is spent as it was intended,” Kilmartin said in a statement. “As the state continues to look for ways to contain increasing Medicaid costs while maintaining the same level of quality services to the populations it serves, this settlement adds significant nontaxpayer dollars to the bottom line.”
Enacted in 1990, the Medicaid Prescription Drug Rebate Program, designed as a cost-containment measure for Medicaid’s payment for outpatient drugs, requires participating pharmaceutical manufacturers pay quarterly rebates to state Medicaid programs for each of its drugs sold to pharmacies that were reimbursed by Medicaid.
The Medicaid Fraud Control and Patient Abuse Unit enforces laws addressing fraud in Rhode Island’s Medicaid program and prosecutes cases of abuse, neglect or mistreatment of patients in all state health care facilities, reported the Office of the Attorney General. The unit prosecutes criminal activity, seeks civil remedies as appropriate and participates with federal and state authorities in inter-agency investigations and administrative proceedings, including investigating pharmaceutical companies that overbill and defraud Rhode Island’s Medicaid program.
