Walgreens to Pay $35 Million for Switching Drugs


Walgreens pharmacy will pay $35 million to 42 states to settle allegations that it unlawfully switched drugs in order to overcharge consumers.

The charges were brought against Walgreens by whistleblower pharmacist Bernard Lisitza, who has successfully brought similar charges against CVS and Omnicare in the past. Earlier this year, CVS Caremark agreed to pay a $37 million settlement in the generic drug switching case brought by Lisitza and in 2006, Omnicare, the nation's largest pharmacy for nursing homes, agreed to pay a $50 million settlement. For his troubles as a whistleblower, Lisitza may receive between 15 and 30 percent of the government recovery in each case.

According to an article by Pharmalot, Lisitza is described as an "old-fashioned corner pharmacist." He worked for Omnicare when he discovered the drug switching scheme. He reported it and was fired. He then found temporary work at other pharmacies and found that Walgreens and CVS were doing the same thing.

In his lawsuit against Walgreens, Lisitza alleged that the pharmacy illegally switched Zantac tablets to generic tablets and also switched Prozac tablets to generic tablets in order to bill Medicaid up to 400 percent more for the drugs. Lisitza's lawyer says that he wanted the government to know that the drugs were being switched in order to increase pharmacy profits at the taxpayers' expense.

Patrick Fitzgerald, US Attorney for the Northern District of Illinois, said in a statement, "Switching medication from tablets to capsules might seem harmless, but when that is done solely to increase profit and in violation of federal and state regulations that are designed to protect patients, pharmacies must know that they are subjecting themselves to the possibility of triple damages, civil penalties and attorney fees. These penalties, coupled with the willingness of insiders to report fraud, should deter such misconduct, but when it doesn't, the result in this case and others serves notice that we will aggressively pursue all available legal remedies."

However, when all is said and done, it remains to be seen if $35 million is any more than a slap on the wrist for a pharmacy giant like Walgreens. After all, if no one was actually injured by the drug switching and the penalties were not that stiff, what would be the incentive for this fraudulent practice to cease?

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