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McKesson Corp.

Date Filed: October 6, 2006
Court: U.S. District Court, District of Massachusetts
Type of Case: Pharmaceutical Fraud
Case Number: 08-CV-10843
Status: Settled
Company Name: McKesson Corp.
Stock Symbol: NYSE: MCK

Hagens Berman Sobol Shapiro filed a class action lawsuit against McKesson Corp., one of the nation's largest drug wholesalers. According to the suit, McKesson conspired with others to intentionally inflate drug prices to bring in higher returns. According to the complaint, this means consumers throughout the nation are paying artificially inflated prices for drug regimens prescribed by their doctors.

In late 2006, a settlement was reached with one of the defendants, First DataBank, but the case against McKesson is still moving forward.

Recently, plaintiffs made public a document showcasing evidence that supports the notion that McKesson intentionally bumped prices in order to return higher profits to pharmacies nationwide.

RECENT DEVELOPMENTS:

Dec. 31, 2010 – Hagens Berman, co-lead counsel in the McKesson lawsuit filed in 2006, confirmed that more than 315,000 reimbursement checks were distributed by mail to eligible cash-payor consumer class members and “pharmacy” class members today. This is the first round of payouts after McKesson agreed to a $350 million settlement for allegedly inflating the price of more than 400 prescription drugs by manipulating drug-pricing benchmarks. Claims for third party payors and consumers who made percentage co-pays are still under review and verification by the claims administrator. When complete, additional disbursements will be made to members of those subclasses.

March 13, 2009 - Today the court appointed Hagens Berman Sobol Shapiro and managing partner Steve Berman co-lead counsel in a case against McKesson and First Databank representing public payors.

In the appointment, the court also consolidated eight individual actions by various states and counties around the country. The court ruled consolidating would expedite the process of the cases since they all share similar claims.

The consolidation does not include HBSS' case filed on behalf of the San Francisco Health Plan or a case filed on behalf of the state of Connecticut. Both cases are moving forward as individual actions.

All suits claim McKesson and First Databank engaged in an unlawful scheme to inflate the average wholesale price (AWP) for certain drugs.

Nov. 21, 2008 - Today Hagens Berman announced a $350 million settlement with McKesson to settle allegations the company fraudulently inflated the price of more than 400 prescription drugs by manipulating drug-pricing benchmarks.

The lawsuit, still pending court approval, will reimburse those who paid for the brand-name drugs and whose payments were tied to AWP. This includes all purchases from Aug. 1, 2001, until March 15, 2005.

The plaintiffs propose the $350 million divide among three groups: insurers and other entities that paid for drugs ($288,675,000), consumers who paid a graduated co-payment ($20,900,000), and cash paying consumers ($40,425,000).

The suit against McKesson alleged the company conspired with publishing giant, First DataBank, to artificially inflate the prices of branded prescription drugs to benefit key retail clients. The suit alleged third-party payers and consumers made hundreds of millions of dollars in excess payments as a direct result.

If you have questions about the settlement, and how it affects you, please contact the firm by calling (206) 623-7292.

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