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Generic drugmakers accused in Medicaid scheme

Whistleblower suit says three companies scammed the government out of millions

A Chicago pharmacist is suing three generic drugmakers for scheming to overcharge the government by millions of dollars. The U.S. Attorney’s office joined the case on Tuesday.

The suit, brought by pharmacist Bernard Lisitza, claims that New Jersey-based Par Pharmaceutical Cos. and its two foreign sister companies got pharmacies to illegally switch from generic versions of Prozac and Zantac to more expensive versions of the drugs.

The scheme centered on Medicaid requiring a cap on capsules but not tablets for the generic version of Prozac, and a cap on tablets but not capsules for the generic version of Zantac.

The suit claims Par got the pharmacies to substitute to the forms with no price caps, then charged two to five times the price of the capped form. The scheme, the suit alleges, gave the pharmacies a higher reimbursement from Medicaid and allowed the three drugmakers to corner the market.

Damages and penalties could exceed $300 million.


Cathleen Flahardy

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