US and state governments join lawsuits accusing Wyeth of overcharging Medicaid

The US Department of Justice revealed that it joined two whistleblower lawsuits against Wyeth that accuse the drugmaker of overcharging Medicaid for Protonix (pantoprazole). The government, which also said 15 states plus the District of Columbia were joining the litigation, alleged that Wyeth bundled the intravenous and oral versions of the proton pump inhibitor and offered the combination of the two products to hospitals at "steep discounts," without offering the same discount to the government.

Tony West, the DoJ's assistant attorney general for the civil division, commented that "by offering massive discounts to hospitals, but then hiding that information from the Medicaid programme, we believe Wyeth caused Medicaid programmes throughout the country to pay much more for these drugs than they should have." The DoJ said Wyeth "allegedly avoided paying hundreds of millions [of dollars] in rebates due to state Medicaid programmes for its drugs."

The government noted that Wyeth is believed to have bundled the two versions of Protonix in order to gain access to the outpatient market for the oral treatment, following use of the intravenous version by patients while in hospital. Responding to the news, Wyeth spokesman Doug Petkus stated that "the company believes that its pricing calculations were correct and intends to defend itself vigorously in these actions."

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