Michigan Attorney General Dana Nessel and the attorneys general for Colorado, Georgia, North Carolina, Texas, and Washington have filed suit in federal district court against Regeneron Pharmaceuticals (PDF), a New York-based pharmaceutical company, for allegedly inflating the amount that the states’ Medicaid programs have paid and continue to pay for the eye medication Eylea. The complaint alleges the scheme resulted in the submission of tens of thousands of false claims to Medicaid and millions of dollars in losses to the states. Regeneron manufactures and sells Eylea, an FDA-approved drug used to treat forms of macular degeneration and other ophthalmological conditions.
The complaint alleges that Regeneron was required to include all price concessions for Eylea as part of its average sales price (ASP) reporting to CMS, but knowingly failed to include credit card processing fees that Regeneron paid its distributors to allow distributors to charge customers a lower effective price for Eylea. The states allege that Regeneron paid these credit card fees so that doctors and retina practices that purchased Eylea could use credit cards at no additional cost and obtain hundreds of millions of dollars in “cash back” rewards. By knowingly failing to report these credit card processing fees as price concessions, Regeneron falsely inflated each state’s Medicaid reimbursement for Eylea, according to the complaint.
