A notable settlement with big pharma was reached last week.

Joel M. Androphy and Sarah M. Frazier of Berg & Androphy, along with the State of Texas and other law firms, reached settlements in Texas Medicaid Fraud Prevention Act litigation against AstraZeneca.

This suit was originally filed in October 2014, when the whistleblowers accused the defendant of abusing the state’s Medicaid program by fraudulently marketing powerful antipsychotic drugs and paying kickbacks to doctors and state officials.

The settlement encompasses allegations that AstraZeneca directly misled governing bodies of Texas Medicaid, which allowed Crestor to obtain placement on the Texas Medicaid Preferred Drug List free of “prior authorization” restrictions, boosting sales by millions of dollars. Further, the suit alleges that AstraZeneca planned and implemented an unlawful promotional scheme promoting Crestor’s efficacy for unapproved or “off-label” uses, misrepresenting the results of clinical studies, and misleadingly claiming Crestor’s superior efficacy over other statin drugs, including chief competitor Lipitor.

In resolving its liability, AstraZeneca agreed to pay the State of Texas a total sum of $20 million for the release of Texas claims covering the conduct alleged by the suits against the company. The settlement netted Texas and the whistleblowers about $15.5 million.

“When pharmaceutical companies unduly influence decisions about preferred drugs, Medicaid agencies with limited funds may pay for more expensive, brand-name drugs, leaving less funding available to provide essential drugs to all,” said Frazier. “This is a vital area for policing fraud.”

The case is State of Texas et al. v. AstraZeneca, LP et al.; In the 353rd Judicial District Court, Travis County, Texas; Cause No. D-1-GV-13-000812.

Leaders In The Law’s coverage of Berg & Androphy’s 2017 qui tam settlement can be found here.