Attor­ney Gen­er­al Pax­ton Recov­ers $25 Mil­lion for State of Texas, U.S. Med­ic­aid Program

Texas Attorney General Ken Paxton has resolved an enforcement action against New Jersey-based pharmaceutical product manufacturer Glenmark Generics Inc. USA. The agreement resolves the State’s investigation under the Texas Medicaid Fraud Prevention Act (“TMFPA”) against Glenmark for fraudulently reporting inflated drug prices to the Medicaid program.

Under the settlement agreement, Glenmark must pay the State of Texas a total of $11.25 million for the State’s general revenue fund. Because the Medicaid program is jointly funded by the State and U.S. taxpayers, the federal government is entitled to a percentage of the settlement proceeds. The federal government’s share is also $11.25 million. Additionally, the Texas Attorney General’s Office will receive $2.5 million in attorneys’ fees and costs.

Attorney General Paxton issued the following statement about today’s settlement with Glenmark:

“Identifying and preventing Medicaid fraud continues to be a top priority for the Office of the Attorney General. Thanks to our Civil Medicaid Fraud Division’s conscientious stewardship of the taxpayer-funded Medicaid program, Texas will receive an $11.25 million reimbursement from a New Jersey-based pharmaceutical manufacturer. The Office of the Attorney General will continue cracking down on waste, fraud and abuse in the Medicaid program.”

State’s settlement agreement with Glenmark

Since 2000, the Texas Attorney General’s Civil Medicaid Fraud team has investigated dozens of pharmaceutical manufacturers for reporting inflated drug prices to the Medicaid program. In August 2012, the State launched an investigation against Glenmark for possible violations of the TMFPA. The State’s investigation found that since 2005, Glenmark violated Texas law when it illegally misreported prices to Medicaid in order to induce pharmacies and other providers to purchase Glenmark’s products over its competitors’ products. As a result, Medicaid reimbursed pharmacies more than it should have for certain of Glenmark’s products.

Since 2002, the Civil Medicaid Fraud Division’s recoveries for the State of Texas have surpassed the $600 million mark – while total recoveries for the state and federal governments now exceed $1.5 billion.

To obtain more information about the Office of the Attorney General’s efforts to fight Medicaid fraud, access the agency’s website at www.texasattorneygeneral.gov.