Federal court rules against drug company in AWP case

July 5, 2007

A U.S. District Court judge in Massachusetts has found that AstraZeneca, among other companies, violated the Massachusetts consumer protection act by reporting false average wholesale prices for a number of prescription drugs, including goserelin acetate (Zoladex), used in the treatment of prostate cancer.

A U.S. District Court judge in Massachusetts has found that AstraZeneca, among other companies, violated the Massachusetts consumer protection act by reporting false average wholesale prices for a number of prescription drugs, including goserelin acetate (Zoladex), used in the treatment of prostate cancer.

The ruling stems from a lawsuit brought by members of the Prescription Access Litigation (PAL), according to a PAL statement. The lawsuit is part of a larger case in which dozens of defendants are alleged to have reported inflated and inaccurate average wholesale prices for drugs covered by Medicare Part B in order to increase sales of their drugs. The ruling benefits health plans and consumers in Massachusetts who paid part or all of the 20% of the remaining cost of drugs, as well as health plans that paid for these drugs for patients not enrolled in Medicare, according to the statement.

“Today’s decision rights a great wrong that was done by these companies against some of our society’s sickest and most vulnerable patients,” said Alex Sugerman-Brozan, director of PAL.

Although government programs, including Medicare Part B and Medicaid, have abandoned average wholesale prices, private health plans and insurers still use it.