DOJ: News Release

Medicaid Fraud Unit, Bayer Reach Settlement

HELENA — Bayer Corporation recently agreed to pay Montana Medicaid more than $190,000 as part of a settlement agreement between the pharmaceutical giant and the Medicaid Fraud Control Unit of the Department of Justice.

Gordon Hage, director of the Medicaid Fraud Control Unit, said the settlement was the result of the pharmaceutical company failing to provide the lowest prescription rate for Medicaid participants.

Hage said the case alleged that Bayer “private labeled” Cipro, an antibiotic and Adalat, an anti-hypertensive, for health maintenance organization Kaiser Permanente and failed to report the private-label price to Medicaid. Medicaid recipients then paid a higher prescription rate — not the lowest possible rate — for the drugs than Kaiser-Permanente did.

“Each year we see more and more cases of drug manufacturers entering into Medicaid agreements then breaching those agreements to maximize their profits,” Hage said.

The Bayer case also involved investigators from the U.S. Department of Justice and National Association of Medicaid Fraud Units.

The funds — $190,088.57 — are repaid to the Montana Medicaid program administered by the state Department of Public Health and Human Services. The Montana settlement also included $378,971 in federal matching funds.

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