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Aventis Pharmaceutical to Pay U.S. $95.5 Million to Settle False Claims Act Allegations
Date:5/28/2009

WASHINGTON, May 28 /PRNewswire-USNewswire/ -- Aventis Pharmaceutical Inc., a wholly owned subsidiary of sanofi-aventis U.S. LLC, has agreed to pay the United States $95.5 million to settle allegations that it violated the False Claims Act by misreporting drug prices in order to reduce its Medicaid Drug Rebate obligations, the Justice Department announced today.

The settlement resolves allegations that between 1995 and 2000, Aventis and its corporate predecessors knowingly misreported best prices for the steroid-based anti-inflammatory nasal sprays Azmacort, Nasacort and Nasacort AQ. Under the Medicaid Drug Rebate Statute, Aventis was required to report to Medicaid the lowest, or "best" price that it charged commercial customers, and pay quarterly rebates to the states based on those reported prices.

In order to avoid triggering a new best price that would obligate it to pay millions of dollars in additional drug rebates to Medicaid, Aventis entered into "private label" agreements with the HMO Kaiser Permanente that simply repackaged Aventis's drugs under a new label. As a result, Aventis underpaid drug rebates to the Medicaid program and overcharged certain Public Health Service entities for these products.

"This agreement reflects our commitment to ensuring that Aventis and other drug companies fulfill their obligations under the Drug Rebate Statute to accurately report pricing information and pass the savings along to the Medicaid program," said Tony West, Assistant Attorney General for the Department's Civil Division. "We will continue to ensure that programs for the most vulnerable portions of our population do not pay any more for pharmaceutical products than they should under the law."

"We will continue to be vigilant in investigating and prosecuting those who scam the Medicaid system - a system that is meant to benefit the poor," said Michael K. Loucks, Acting U.
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SOURCE U.S. Department of Justice
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