The city yesterday filed a lawsuit against a major pharmaceutical company for bilking New York out of millions in Medicaid funds by conspiring to keep the generic version of its popular drug OxyContin off the market.
The city took its action after an earlier federal court decision found that Purdue Pharma had lied to obtain its patent for the drug, which kept generic drugmakers from manufacturing a competing product.
“This suit is an important step to protect New York City taxpayers against prescription-drug overcharges that result in illegal Medicaid charges,” said Michael Cardozo, the city’s corporation counsel.
The city shelled out $5.5 million in 2002 alone for OxyContin, a popular, though frequently abused, painkiller. While the Law Department has yet to determine how much cash it will ultimately seek from Purdue Pharma, city officials say it will sue for triple damages for the overcharges.
“It is indisputable that New York City would have paid less were generic alternatives … available,” said Joanne Cicala, lead attorney on the case.
The city’s claim is seemingly bolstered by an earlier court decision that found Purdue Pharma had committed fraud on the U.S. Patent and Trademark Office.
But a lawyer for the drug company said he’s confident that decision will be reversed on appeal.
“We are very confident that we will prevail on the merits,” said Tim Bannon, Purdue Pharma’s special counsel.
“We expect that any claims arising from the adverse decisions at the trial-court level will be dismissed as a result of the appeal,” Bannon continued.