No one likes paying too much for something—especially when the overpayment amounts to millions of dollars.
Yesterday, a union benefits fund sued Walgreen Co. and Par Pharmaceutical Cos. for allegedly conspiring to overcharge insurance companies, self-insured employers, and union health and welfare funds for generic medications.
The United Food & Commercial Workers Unions & Employers Midwest Health Benefits Fund claims the country’s biggest drugstore chain and the generic drug company violated federal racketeering laws by swapping prescription drugs, such as the heartburn drug Zantac and the antidepressant Prozac, for more expensive generic versions in order to boost profits. The suit claims third-party payers paid millions more for the generic pills than they would have for the prescription tablets.
The fund seeks to represent all third-party payers in the U.S. between 2001 and 2006 and is asking for unspecified cash damages.
The lawsuit relates to a 2008 agreement in which Walgreens paid $35 million to settle claims by the U.S. and 42 states that it was overcharging state Medicaid programs for generic forms of the aforementioned prescription drugs.
Read Bloomberg for more details.