Mich. AG Announces $370,000 Settlement with GlaxoSmithKline

April 12, 2006

Attorney General Mike Cox announced today that Michigan, along with 48 other states, has reached a settlement with drug manufacturer GlaxoSmithKline involving the anti- depressant prescription drug, Paxil.

GlaxoSmithKline is to reimburse the state approximately $370,000 for overpayments made by the state’s Medicaid and other healthcare programs.

“Prescription drugs are expensive as it is,” said Cox. “That makes it all the more troublesome to see the price of a prescription being unnecessarily inflated. Everyone pays when the state is overcharged. My office will continue to stand up for the taxpayers of Michigan.”

Michigan, Maryland, New York, and Wisconsin negotiated a 49-state antitrust settlement under which the participating states recovered $14 million from drug company GlaxoSmithKline. A separate settlement was previously reached by other litigants to resolve consumer, insurance company, and other governmental payer claims. The states’ complaint and settlement were filed in federal court in Pennsylvania.

In the multi-state complaint, Cox alleged that GlaxoSmithKline unlawfully used the patent approval process and the court system to improperly extend the patent and monopoly on Paxil. This action allegedly caused a delay in the release of more cost-effective generic versions. Consequently, state Medicaid programs and other state programs paid more for the drug than they would have if the generic versions of the drug reached the market sooner.

Source: Michigan Attorney General

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