Press Release  AmerisourceBergen to Pay More than $490,000 to MassHealth over Allegations of Distributing Contaminated Drugs

Boston — One of the largest drug wholesalers in the country will pay the state’s Medicaid program (MassHealth) more than $490,000 to resolve allegations that the company sold misbranded and adulterated drugs in Massachusetts, Attorney General Maura Healey announced today.

The federal and multi-state settlement with AmerisourceBergen Corporation (ABC) will provide more than $99 million to Medicaid programs across the country.

“This national drug company put lives at risk by selling tainted drugs and misleading doctors and patients about its products,” said AG Healey. “Pharmaceutical companies must comply with the laws in place to protect the health and safety of our residents.”

The settlement resolves allegations concerning the conduct of Medical Initiatives, Inc. (MII), an Alabama-based pharmacy unit of ABC’s subsidiary, AmerisourceBergen Specialty Group (ABSG). MII, which closed in 2014, broke the seal of FDA-approved drug vials of oncology supportive care drugs used during chemotherapy, pooled the drug product, and created pre-filled syringes to sell to practitioners. The drugs involved included Aloxi®, Anzemet®, Kytril®, Neupogen®, Procrit®, as well as the generic version of Kytril®.

The investigation revealed that MII was not a pharmacy, but a repackager and failed to apply for a required New Drug Application for the pre-filled syringes. To prepare the pre-filled syringes, MII repackaged the drug product in plastic syringes that allowed MII to sell the excess drug product (known as “overfill”) in the vials. The pre-filled syringes, which were prepared in an unsterile environment and often contained particles of foreign matter, were then shipped to providers through another branch of ABSG, Oncology Supply Company.

MII did not comply with pharmacy regulations in any state in which it was licensed. The civil settlement also resolves allegations that the company double-billed for the same vial of drug by using and billing for the overfill drug product, as well as allegations that the company provided unlawful kickbacks to physicians to induce them to purchase Procrit® in pre-filled syringes rather than untainted vials.   

In September 2017, ABSG pleaded guilty in federal court to illegally distributing misbranded drugs.

This matter was handled for the AG’s Office by Assistant Attorneys General Stephany Collamore and Robyn Dollar of AG Healey’s Medicaid Fraud Division. A National Association of Medicaid Fraud Control Units (NAMFCU) Team participated in the investigation and conducted the settlement negotiations with ABC on behalf of the states.

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