Texas Medicaid Recovers $110M from AstraZeneca

The off-label marketing for antipsychotic drugs allegedly occurred while AstraZeneca was already under a 2010 federal corporate integrity agreement for Medicaid fraud.

AstraZeneca will pay the Texas $110 million to settle allegations that the drug maker illegally marketed two antipsychotic drugs to Medicaid providers in the state, Attorney General Ken Paxton announced.

According to Texas prosecutors, AstraZeneca ran the misleading marketing schemes at a time when the company was already under a 2010 federal corporate integrity agreement resulting from prior allegations of Medicaid fraud.

The federal agreement banned AstraZeneca from promoting its antipsychotic medication Seroquel and cholesterol-lowering statin drug Crestor for uses not approved by the Food & Drug Administration, but Texas alleged the company continued to do so anyway.

Paxton said the drugs were promoted primarily to treat children and adolescents and that AstraZeneca made hundreds of thousands of dollars in illegal payments to two former state hospital doctors to unduly influence the use of Seroquel in the state hospital system.

"The allegations that led to this settlement are especially disturbing because the well-being of children and the integrity of the state hospital system were jeopardized," Paxton said.

Paxton noted that AstraZeneca was accused of a similar nationwide marketing fraud scheme involving Crestor, that included a "plan of deception" targeting Texas Medicaid to expand statin use beyond what the science supported, while downplaying the risk of diabetes in some patients.  

AstraZeneca Responds

AstraZeneca issued a statement Wednesday morning confirming the settlement, but adding that it "makes no concessions or admissions of fault."

"While AstraZeneca denies the allegations, it is in the best interests of the company to resolve these matters and to move forward with our business of discovering and developing important, life-changing medicines – while avoiding the delay, uncertainty, and expense of protracted litigation," the drug maker said.