Judge: Pharma Company Overcharged State by $27.6 Million
The Legal Intelligencer
September 22, 2010A Commonwealth Court judge has ordered pharmaceutical company Bristol-Myers Squibb Co. to stop inflating the wholesale price of its drugs purchased by the state's pharmaceutical drug programs for the poor and for the elderly.
Commonwealth Court Judge Robert E. Simpson said in a Sept. 10 order in Commonwealth of Pennsylvania v. Bristol-Myers Squibb Co. that Bristol-Myers, headquartered in New York City, violated the Pennsylvania Unfair Trade Practices and Consumer Protection Law with unfair or deceptive practices. The judge said Bristol-Myers owes $27.6 million to the state of Pennsylvania for the price of drugs charged in violation of fair trade practices.
But the judge said in his order that he was not awarding damages or attorney fees. The judge said he did not have sufficient information to calculate civil penalties because the plaintiff's expert did not limit his information to how many times the average wholesale price changed for Bristol-Myers Squibb's drugs from 1991 until 2004 and the expert may have included drugs not subject to the litigation.
Simpson's order followed a defense jury verdict in the case. The jury did not find common-law negligent misrepresentation or fraudulent misrepresentation by Bristol-Myers Squibb, Simpson wrote, but he said that the standard under the unfair trade practices law is different. A plaintiff's lack of reliance on the representation and a plaintiff's knowledge that a representation is inaccurate are not "complete defenses in an enforcement action brought in the public interest," Simpson said.