Court Gives Final Approval to $82 Million McKesson Municipalities Settlement

Hagens Berman today announced that United States District Judge Patti B. Saris has approved a settlement in a class-action case brought on behalf of cities, counties and municipalities across the United States alleging that McKesson Corp. (NYSE: MCK) engaged in a scheme to fraudulently inflate the price of more than 400 brand-name prescription drugs.

Municipalities pay for drugs used by their employees who are enrolled in self-insured health plans, and in some cases administer community clinics and other non-Medicaid or Medicare public assistance programs.

Judge Saris' decision means that checks will be mailed to eligible class members across the country in the coming months. The court has certified the following class in the case:

"All non-federal and non-state governmental entities in the United States and its Territories that paid for any of the drugs listed in Appendix A to the Second Amended Complaint ("Marked-Up Drugs") based on AWP from August 1, 2001, to October 6, 2006, and that used First DataBank or Medi-Span data derived from First DataBank data in determining the AWP of the Marked-Up Drugs."

Eligible class members can contact Hagens Berman by calling 206-623-7292.

According to the complaint, originally filed on August 7, 2008 in the U.S. District Court for the District of Massachusetts in Boston, McKesson violated federal racketeering laws by rigging the average wholesale price (AWP) of brand-name drugs while raising the spread between the published AWP and the wholesale acquisition cost from 20 to 25 percent. The complaint alleged that this was done in an effort to increase profits by currying favor with McKesson's large retail pharmacy clients. The complaint also claimed that McKesson cleverly concealed the scheme so that payors like municipalities would wrongfully attribute the increases to drug manufacturers.

Attorneys claimed that the scheme inflated the price of more than 400 brand name prescription drugs, including blockbusters such as Prozac, Lipitor, Zocor and Bioxx.

Another case brought by consumers and third-party payors settled in 2008 for $350 million. The settlement was given final approval by Judge Saris on August 3, 2009.

Hagens Berman is continuing to litigate cases on behalf of six states over similar claims, including Oregon, Virginia, Utah, Montana, Mississippi and Connecticut.

More information about this case can be found at /cases/pharmaceutical-average-wholesale-price-litigation.

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About Hagens Berman
Hagens Berman Sobol Shapiro LLP is a consumer-rights class-action law firm with offices in nine cities. The firm has been named to the National Law Journal’s Plaintiffs’ Hot List seven times. More about the law firm and its successes can be found at Follow the firm for updates and news at @ClassActionLaw.

Ashley Klann
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