Pharmaceutical giants Bayer and GlaxoSmithKline on Wednesday reached a record-setting Medicare fraud settlement over allegations they overcharged millions of dollars for popular prescription drugs.
Bayer, based in Germany, agreed to pay $257 million to settle allegations that it overcharged Medicare for prescription drugs including Cipro, the popular antibiotic used during the U.S. anthrax scare. A Bayer spokesman said the company did not believe it had done anything illegal. The company set aside $257 million last year to settle the case.
Glaxo, based in Britain, agreed to settle the case for $87.6 million "to avoid delay and expense of a trial," the company said. Glaxo said it still believes it was acting in good faith. The government said that Glaxo overcharged for the antidepressant drug Paxil and Flonase, a nasal spray for allergies.
"These frauds impacted the most vulnerable citizens we have, the elderly and the poor," said Assistant U.S. Atty. Susan Winkler.
The settlement money will be divided among the federal government, states and some public health entities. The states will receive $147.3 million. The California attorney general's office said Wednesday that the state's share could amount to $32.2 million.