Drug Companies Asked to Settle By Alabama

The recent court victories over the latest two pharmaceutical companies could mean the end of court battles for the other drug companies that the state has sued. The Attorney General is now asking the remaining companies to settle, and he gave them 30 days to decide.

So far, there have been three court victories in all and the last verdict, of more than 114-million dollars a couple of days ago, did it. Attorney for the state, Jere Beasley, says now is the time. "The last case we tried was designated sort of as a test case. They thought the first one was something that maybe wouldn't happen again."

In all, the state sued 72 pharmaceutical companies claiming they overcharged the state's Medicaid program. One company in particular Beasley claims went overboard. "You can go to the drug store down here as a private person and buy that drug for let's say $10.00, and if you went through the Medicaid program we'd pay 1,000% more for it - the state would and that is absolutely wrong."

But, Beasley says, there are 69 companies remaining that have to go to trial for allegedly cheating the Medicaid program. "The Medicaid program is designed to benefit the elderly, the poor, the disabled and children and it is mind boggling that these folks can think that they can get away with what they're doing to the state."

But, instead of going to trial, the state sent a letter to those 69 companies giving them 30 days to decide if they want to settle. "It's important to settle these cases because the state is also having to hire experts. These experts don't come cheaply. $650 an hour is typical for an expert in these drug cases," Beasley points out.

This is an effort that's being applauded by those affected by Medicaid like AARP's State Director  Joan Carter. "We definitely support that. And, that's important to you because? We don't want to have the state spend additional money unnecessarily."

Attorney Jere Beasley says five or six of the 69 pharmaceutical companies have already expressed an interest in settling but that probably won't be cheap. He estimates about $1,000,000,000  of compensatory damages are still out there. Add on to that 6% interest. Plus, 10 or 15% above that for punishment, and that is what he wants the companies to pay.

Beasley also says if the companies don't take the state up on its offer to settle it will be too late after the 30 days.

Reporter: Eileen Jones