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Georgia Medicaid Receives Over $12.5 Million in State and Federal Dollars from Settlement with Abbott Laboratories

PRESS ADVISORY

Georgia Medicaid Receives Over $12.5 Million in State and Federal Dollars from Settlement with Abbott Laboratories

May 7, 2012

Attorney General Sam Olens announced today that Georgia has joined with other states and the federal government and reached an agreement with Abbott Laboratories to settle civil and criminal allegations that Abbott Laboratories illegally marketed Depakote.  The $1.5 billion settlement is the second largest recovery from a pharmaceutical company in a single civil and criminal global resolution.  Georgia Medicaid will receive $12,675,018.34, in state and federal dollars, and the state portion of that amount is $5,164,191.82.

The states contend that from January 1998 through December 31, 2008, Abbott promoted the sale and use of Depakote for uses that were not approved by the Food and Drug Administration as safe and effective.   This alleged conduct resulted in false claims to Medicaid and other federal healthcare programs.  Further, the covered conduct from the settlement provides that Abbott Laboratories made false and misleading statements about the safety, efficacy, dosing and cost-effectiveness of Depakote for some unapproved uses; improperly marketed the product in nursing homes; and paid illegal remuneration to health care professions and long term care pharmacy providers to induce them to promote and/or prescribe Depakote. 

Abbott Laboratories will pay the states and the federal government a total of $800 million in civil damages and penalties to compensate Medicaid, Medicare, and various federal healthcare programs for harm suffered as a result of its conduct.  In addition to the civil settlement, Abbott Laboratories pled guilty this morning to a violation of the Food, Drug, and Cosmetic Act and agreed to pay a criminal fine and forfeiture of $700 million.  Further as a condition of the settlement, Abbott Laboratories will enter into a Corporate Integrity Agreement with the United States Department of Health and Human Services, Office of the Inspector General.

This settlement is based on four qui tam cases that were consolidated and are pending in the United States District Court for the Western District of Virginia in Abingdon, Virginia.  The cases were filed under Federal and State false claims statutes.

A state team appointed by the National Association of Medicaid Fraud Control Units participated in the investigation and conducted the settlement negotiations with Abbott on behalf of the participating states.  Team members include representatives from the Offices of the Attorneys General for the states of California, Georgia, Illinois, Massachusetts, Maryland, South Carolina, Ohio and Virginia.