Wyeth accused of overcharging Medicaid

The US Department of Justice and 16 states have joined in two whistleblower law suits filed in the district of Massachusetts against  Wyeth, accusing the US drug major of overcharging Medicaid for Protonix  (pantoprazole), an ulcer drug that earned $215.0 million in  first-quarter 2009.

The suits allege that the company knowingly failed to give the  government the same discounts it provided to private purchasers of its  drugs, as required by laws governing the Medicaid program, and as a  result avoided paying hundreds of millions in rebates due to state  programs for Protonix Oral and Protonix IV.

Between 2000 and 2006, Wyeth offered steep discounts to thousands of  hospitals nationwide if both drugs were bought together under a bundled  arrangement that involved up to 94% off the list price of Protonix Oral  and 80% off for Protonix IV. The DoJ claims the discounts were not  passed on.