Attorney General's News Release

February 28, 2012

AG Koster announces St. Louis-based KV Pharmaceutical to pay Missouri $289,000 to settle Medicaid-related false claims allegations

Jefferson City, Mo. – Attorney General Chris Koster announced today that the Missouri Medicaid program will receive more than $289,000 to settle allegations that KV Pharmaceutical misrepresented that two drugs were approved for coverage under federal and state health care programs, including Medicaid.

Under the agreement, KV Pharmaceutical Company, which is the St. Louis-based parent company of now-defunct Ethex Corporation, will pay a total of $17 million to the federal governments and participating states to compensate Medicaid and various federal healthcare programs for Ethex’s conduct.

The settlement resolves allegations that Ethex misrepresented the regulatory status of Nitroglycerin Extended Release Capsules (Nitroglycerin ER) and Hyoscyamine Sulfate Extended Release Capsules (Hyoscyamine ER) and failed to advise the Centers for Medicare and Medicaid Services (CMS) that these unapproved drugs did not qualify for coverage under federal health care programs. As a result, the government contends, Ethex knowingly caused false claims to be submitted and paid for Nitroglycerin ER and Hyoscyamine Sulfate ER. There has been no allegation of any risk or harm to any patients taking these drugs. Neither drug is currently on the market.

“Pharmaceutical companies must be held accountable for their actions,” Koster said. “This Attorney General’s Office will continue to place a priority on fighting Medicaid fraud returning these scarce health care dollars to the state,” Koster said.

Koster said citizens should report suspected Medicaid provider fraud or abuse and neglect to his Medicaid Fraud Hotline toll free at 800-286-3932, e-mail the complaint to attorney.general@ago.mo.gov or complete a complaint form at the Attorney General’s Medicaid Fraud Website at http://ago.mo.gov/divisions/medicaid-fraud-control-unit-faqs.htm.