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MADISON — Attorney General J. B. Van Hollen announced today that Wisconsin has joined with other states and the federal government in a $500 million dollar settlement to resolve civil and criminal allegations that Ranbaxy, a generic pharmaceutical manufacturer based in Gurgaon, India, introduced adulterated drugs into interstate commerce. As a result, false or fraudulent claims were submitted to Wisconsin’s Medicaid Program.
Ranbaxy has agreed to pay the states and the federal government $350 million dollars in civil damages and penalties to resolve civil allegations of poor manufacturing practices in two Indian manufacturing plants. Of this amount, $266,729,715.10 will go to the Medicaid program, which is funded jointly by the states and the federal government. The portion of the settlement amount recovered by Wisconsin is $1,142,376.29 as part of the total $2,878,795.01 (federal and state) attributable to Wisconsin Medicaid. The remaining $83,270,284.86 is designated for other federal health care programs affected by Ranbaxy’s conduct.
Additionally, Ranbaxy USA, a subsidiary, has pleaded guilty to seven felony counts alleging violations of the U.S. Food, Drug, and Cosmetic Act, and has agreed to pay $150 million dollars in criminal fines and forfeitures. Also, Ranbaxy entered into a consent decree in January 2012 with the federal government to address outstanding current good manufacturing practice (cGMP) and data integrity issues in the two Indian manufacturing plants at issue. These provisions include a wide range of actions to correct its violations and to ensure that the violations do not occur again.
The investigation resulted from a qui tam action filed in the United States District Court for the District of Maryland under the federal False Claims Act and various state false claims statutes, including Wisconsin’s. The whistleblower’s complaint alleged that Ranbaxy knowingly manufactured, distributed and sold generic pharmaceutical products – whose strength, purity and/or quality fell below the standards required by the FDA. The products at issue consisted of 26 generic pharmaceutical products manufactured at its facilities in Paonta Sahib and Dewas, India, at various times between April 1, 2003, and September 16, 2010.