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Attorney General's News Release

May 5, 2011

Koster settles with pharmaceutical company in Medicaid fraud case

Jefferson City, Mo.— Attorney General Koster today announced that Missouri has joined other states and the federal government to reach an agreement in principle with pharmaceutical manufacturer, EMD Serono, Inc. to settle allegations of causing false or fraudulent claims for Rebif to be submitted to the Medicaid program. Rebif is an interferon beta-1a drug injected subcutaneously to treat relapsing forms of multiple sclerosis (MS), a chronic autoimmune disease that attacks the central nervous system, in order to reduce the number of flare-ups and slow down the development of physical disability associated with MS. Under the agreement, EMD Serono agreed to pay the participating states and the United States $44.3 million, plus interest. The Medicaid programs nationwide will receive approximately $19 million of the total settlement. Missouri will receive over $480,000 in state and federal funds. Medicaid is funded jointly by the federal and state governments.

During the period of March 2002 through December 2009, EMD Serono offered and paid remuneration to health care professionals for activities such as promotional speaking engagements, attending speaker training, advisory and consultant meetings, educational grants, and charitable contributions. Missouri alleged that at least one purpose of these payments was to induce those professionals to prescribe Rebif.

“One of my top priorities as Attorney General is to enforce our laws against those who take advantage of Missouri taxpayers by committing Medicaid fraud,” Koster said. “This settlement is a significant amount of money to be returned to taxpayers and should serve as notice to pharmaceutical companies that the Attorney General’s Medicaid Fraud Unit will continue to hold them accountable.”

The investigation was initiated by a lawsuit filed under the qui tam provisions of the Federal False Claims Act. This action was pending in the United States District Court for the District of Maryland.

A team representing the National Association of Medicaid Fraud Control Units participated in the investigation and conducted settlement negotiations with EMD Serono on behalf of the states.

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