Attorney General: Kentucky Receives Nearly $300,000 in Novartis Pharmaceuticals Corporation Settlement

FRANKFORT, KY. – Attorney General Andy Beshear announced on Thursday he will be returning $295,916 to Kentucky’s Medicaid accounts as a result of a multistate settlement with Novartis Pharmaceuticals Corporation.
In his first six weeks, Beshear has now returned $2.8 million to the Kentucky Medicaid Program.

“I take my role as Medicaid watchdog seriously,” Beshear said. “My office’s enforcement actions show how critical every Medicaid dollar is, and how Kentucky can afford expanded Medicaid by eliminating fraud within the system.”
The settlement resolved allegations that Novartis provided kickbacks to certain specialty pharmacies in exchange for recommending the drug Exjade to Medicaid and Medicare patients.

In late 2005, Exjade was approved by the U.S. Food and Drug Administration for the treatment of chronic iron overload due to blood transfusions. After launching the drug, Novartis marketed Exjade as a treatment for patients with a number of underlying conditions that affect blood cells or bone marrow, including beta-thalassemia, sickle cell disease and myelodysplastic syndromes.

The settlement resolves allegations that between 2007 and 2012 Novartis paid kickbacks to three specialty pharmacies – BioScrip, Accredo and US Bioservices. The settlement also resolved allegations that Novartis paid kickbacks to other specialty pharmacies to promote the drug Myfortic to doctors. Myfortic is an immunosuppressant that is approved for use in kidney transplant patients.

Beshear’s Medicaid Fraud and Abuse Unit headed Kentucky’s efforts on the case. The Medicaid Fraud and Abuse Control Unit is charged with investigating and prosecuting any health care provider who fraudulently bills or abuses the Medicaid system.

“Medicaid and its expansion provide a critical service that helps Kentucky’s most vulnerable citizens,” Beshear said. “As the Attorney General, I am committed to holding any company that defrauds Medicaid accountable. The actions of companies like Novartis defraud not only the government but the people government serves.”

For more information or to report provider fraud, contact the Medicaid Fraud and Abuse Control Division at 877-228-7384.

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