[Ip-health] Sanofi Pasteur Agrees to Pay $19.8 Million to Resolve Drug Overcharges to the Department of Veterans Affairs

Andrew S. Goldman andrew.goldman at keionline.org
Wed Apr 26 12:59:39 PDT 2017

The Army claims it can't be bothered with pricing issues regarding the Zika
vaccine proposed exclusive license. What could possibly go wrong?

Department of Justice
Office of Public Affairs
Monday, April 3, 2017

Sanofi Pasteur Agrees to Pay $19.8 Million to Resolve Drug Overcharges to
the Department of Veterans Affairs

Sanofi-Pasteur has agreed to pay $19,868,194 to resolve claims that it
incorrectly calculated drug prices and thereby overcharged the U.S.
Department of Veterans Affairs (VA) for drugs under two contracts between
2002 and 2011, the Department of Justice announced today. Sanofi Pasteur, a
Delaware corporation headquartered in Swiftwater, Pennyslvania, is the
vaccines division of Sanofi-Aventis.

“It is important that pharmaceutical companies provide complete, accurate,
and current information to the VA about the pricing of their drugs,” said
Acting Assistant Attorney General Chad A. Readler of the Justice
Department’s Civil Division. “The Department of Justice will ensure that
pharmaceutical companies follow the rules for drug pricing when selling to
the government.”

Under the Veterans Health Care Act, 38 U.S.C. 8126, drug manufactures may
not charge the VA more than a maximum amount, known as the Federal Ceiling
Price (FCP), for covered drugs. Sanofi Pasteur disclosed to the VA that it
had incorrectly calculated the FCP for certain drugs from 2007 to 2011 and
overcharged the VA. The Office of Inspector General for the VA investigated
the matter, and it determined that the error resulted in overcharges going
back to 2002.

“Overcharging VA depletes funds that are available to care for our
veterans,” said Director of the Healthcare Resources Division Mark Myers of
Veterans Affairs, Office of Inspector General. “We will continue to hold
companies accountable for errors in drug pricing.”

Under the settlement, in addition to paying approximately $19.8 million,
Sanofi Pasteur has agreed that it will not pursue claims for reimbursement
for sales where it contends its error in calculating the FCP resulted in a
lower price to the VA.

This settlement was the result of a coordinated effort by the Civil
Division’s Commercial Litigation Branch and the Office of Inspector General
of the Department of Veterans Affairs. No lawsuit was filed in this matter
and there has been no determination of liability.

Andrew S. Goldman
Counsel, Policy and Legal Affairs
Knowledge Ecology International
andrew.goldman at keionline.org // www.twitter.com/ASG_KEI
tel.: +1.202.332.2670

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