Office of the Attorney General
Judge Upholds $20.5 Million Judgment in Attorney General's Case against AstraZeneca

Press Release Date:  Wednesday, January 26, 2011  
Contact Information:  Shelley Catharine Johnson
Deputy Communications Director
502-696-5659 (office)

Attorney General Jack Conway today announced that Franklin Circuit Court has refused to overturn the jury verdict and more than $20.5 million judgment entered against global pharmaceutical giant AstraZeneca.

In October of 2009, a Franklin Circuit Court jury handed down a $14.7 million verdict against AstraZeneca for defrauding the Medicaid program and Kentucky consumers by inflating the prices of their prescription drugs. Civil penalties awarded in the case totaled nearly $5.4 million, along with more than $396,000 in pre-judgment interest.

The Kentucky Medicaid program relies on published average wholesale prices (AWPs) to calculate Medicaid drug-reimbursement rates. During the trial, the Commonwealth proved that AstraZeneca published significantly inflated AWPs for its drugs that bore no relationship to any prices that AstraZeneca actually charged its customers.

Describing this scheme as a "massive transfer of wealth from the taxpayers to AstraZeneca's main customers," Franklin Circuit Court Judge Philip Shepherd denied AstraZeneca's motion for a new trial and other post-judgment motions on January 19, 2011.

"We are obviously very pleased with Judge Shepherd's decision and his careful consideration of this matter," General Conway said. "Once again, we have sent a clear message to drug companies that deceptive business practices will not be tolerated in Kentucky."

The Office of the Attorney General's suit against AstraZeneca is one of 47 lawsuits filed against pharmaceutical manufacturers alleging that the drug companies violated Kentucky's Medicaid Fraud and Consumer Protection statutes and engaged in false and deceptive advertising by publishing their inflated AWPs.

Since General Conway took office in January 2008, his Office of Medicaid Fraud and Abuse Control has recovered or obtained verdicts totaling more than $154 million for the state and federal Medicaid Program.

The Attorney General's Tip Line for reporting allegations of Medicaid fraud is 1-877-228-7384.