A settlement has been reached in a whistleblower class action lawsuit brought against Dey Inc, Dey Pharma LP (formerly known as Dey, LP) and Dey LP Inc. They are accused of engaging in a scheme to report false and inflated prices for numerous pharmaceutical products.
The whistleblowers will receive a share of approximately $67.2 million.
The initial whistleblower complaint against Dey Inc was filed in the Southern District of Florida on August 13, 1997. Eventually the United States interevened in August 2006. The United States alleged that Dey reported false prices for the following drugs: Albuterol Sulfate, Albuterol MDI, Cromolyn Sodium and Ipratropium Bromide. The difference between the resulting inflated government payments and the actual price paid by health care providers for a drug is referred to as the “spread.” The larger the spread on a drug, the larger the profit for the health care provider or pharmacist who is reimbursed by the government. The government alleges that Dey created artificially inflated spreads to market, promote and sell the drugs to existing and potential customers. Because payment from the Medicare and Medicaid programs was based on the false inflated prices, the government alleged that Dey caused false and fraudulent claims to be submitted to federal health care programs and, as a result, the government paid millions of claims for far greater amounts than it would have if Dey had reported truthful prices.
