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BioPharma Named Defendant in Medicaid Overpayment Case

Industry: Life Sciences

Key Facts

  • Client is a biopharmaceutical company
  • Client was named as a defendant in a Louisiana state court
  • The company agreed to a nuisance value settlement

The Situation

The client, a biopharmaceutical company, was named as a defendant in a Louisiana state court case alleging that the company inflated drug price reporting, causing the Louisiana Medicaid Program to overpay for the company’s drug products by more than $20 million. The case was filed by a private, class action law firm retained by the Louisiana Attorney General on a contingency basis.

The Approach

While a number of manufacturers were co-defendants in the case, we positioned our client as unique, focusing on the nature of its drugs and the extensive charitable efforts it had offered Louisiana citizens. When the trial court insisted on personally mediating potential settlements, we asked that the Louisiana Attorney General attend the mediation only after obtaining input from other members of the attorney general’s office who were aware of our client’s contributions to state health and welfare efforts. We also were able to establish that the state’s counsel had included drugs in its Complaint that were not appropriately included in the litigation, which reduced the alleged damages by more than 75%.

The Outcome

Our presentation on the company’s charitable efforts made an impression on the judge, especially after the Louisiana Attorney General reneged on his promised attendance at the mediation. The company agreed to a nuisance value settlement to put the matter behind them in exchange for a full release.