Arkansas to get $5 million in settlement with drug maker


LITTLE ROCK — Arkansas’ Medicaid program will receive more $5 million in a settlement with an India-based drug manufacturer that was accused of introducing low-quality drugs into the U.S. market, Attorney General Dustin McDaniel announced Tuesday.

McDaniel, attorneys general from other states and the federal government had alleged in a lawsuit filed in U.S. District Court in Maryland that pharmaceutical manufacturer Ranbaxy knowingly manufactured, distributed and sold generic drugs with strength, purity or quality that fell below standards required by the U.S. Food and Drug Administration.

McDaniel said the company’s actions caused false and fraudulent claims to be submitted to the Arkansas Medicaid program. The state program, with federal matching funds added, will receive $5.17 as a result of the settlement, he said.

The total settlement amount was $500 million. It is the U.S. government’s largest-ever settlement with a generic drug maker over drug safety.

Ranbaxy was accused of adulterating 26 generic pharmaceutical products manufactured at its facilities in Paonta Sahib and Dewas, India, at various times between April 1, 2003, and Sept. 16, 2010

Ranbaxy USA, a subsidiary of Ranbaxy, has pleaded guilty in federal court to seven criminal violations of the U.S. Food, Drug and Cosmetic Act.

Ranbaxy said in a statement, “While we are disappointed by the conduct of the past that led to this investigation, we strongly believe that settling this matter now is in the best interest of all of Ranbaxy’s stakeholders.”