Drug company forced to repay VA for MILLIONS in overcharges

The drug company Sanofi-Pasteur has agreed to pay nearly $20 million to the U.S. Department of Veterans Affairs (VA) for overcharging it for drugs.

According to the Department of Justice, Sanofi-Pasteur will pay $19,868,194 to resolve claims that it incorrectly calculated drug prices and overcharged the VA for drugs under two contracts between 2002 and 2011.

“It is important that pharmaceutical companies provide complete, accurate, and current information to the VA about the pricing of their drugs,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “The Department of Justice will ensure that pharmaceutical companies follow the rules for drug pricing when selling to the government.”

The Veterans Health Care Act states that drug companies are prohibited from charging the VA more than the Federal Ceiling Price for covered drugs. Sanofi-Pasteur did not adhere to the rule and admitted to the VA that it had incorrectly calculated the price for certain drugs from 2007 to 2011 resulting in an overcharge to the VA. When investigated by the Office of Inspector General for the VA, it was determined that miscalculated prices had been charged since 2002.

“Overcharging VA depletes funds that are available to care for our veterans,” said Director of the Healthcare Resources Division Mark Myers of Veterans Affairs, Office of Inspector General. “We will continue to hold companies accountable for errors in drug pricing.”

As part of the settlement, Sanofi Pasteur has agreed not to pursue claims for reimbursement for sales where it alleges that its calculating error resulted in a lower-priced drug for the VA.

H/T: Justice.gov

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