Attorney General Gansler Announces
$1 Million Payment from Schering-Plough

Maryland Attorney General Douglas F. Gansler today announced the receipt of $964,471.83 from the drug manufacturer Schering-Plough Corporation, which is headquartered in Kenilworth, New Jersey. The nearly one million dollars was paid directly to the Maryland Medicaid program as part of a $435 million national settlement reached with Schering to resolve allegations about its marketing and distribution of a number of its drugs and allegations that it underpaid rebates due to the state Medicaid programs under federal law. Including payments made by Schering to the federal government for the federal portion of the cost of the Maryland Medicaid program, the total value of the settlement to Maryland was $1,639,202.00.

Schering was alleged to have failed to report to the federal government discounts on its drug Claritin Redi-Tabs that it provided to a large HMO. This failure reduced the amount of rebates due to any State Medicaid program that purchased Claritin Redi-Tabs beginning in 1998 and continuing through 2001. Schering also resolved similar allegations with respect to the potassium supplement K during the period 1995 to 2000. Schering was also alleged to have engaged in the improper marketing of drugs used to treat Hepatitis C by making illegal payments to physicians to induce them to prescribe the drugs. The settlement also resolves allegations that Schering made illegal payments to physicians to induce them to use its cancer drugs Temodar and Intron A for uses not approved by the Federal Food and Drug Administration. These activities caused the submission of false claims to the Medicaid program.

The settlement was negotiated by the Medicaid Fraud Control Unit of the Attorney General’s Office and the National Association of Medicaid Fraud Control Units. In making the announcement today, Attorney General Gansler thanked Assistant Attorney General Mike Travieso for his work on the case.