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Teva Pharmaceuticals Settles FCA Case

Teva Pharmaceuticals announced a settlement in principle of claims brought by Ven-A-Care of the Florida Keys, Inc. under state and federal False Claims Acts. The suits allege that Teva overstated its prices, causing governments to pay inflated reimbursements under Medicaid and other programs. Teva will record a charge of $315 million in its fourth quarter 2009 results, both for settlement costs and for a litigation reserve.

Teva Pharma (TEVA) Settles with Ven-A-Care; To Record Charge of $315M for Q409

February 5, 2010 8:59 AM EST

Teva Pharmaceutical Industries Ltd. (NASDAQ: TEVA) announced today that several of its subsidiaries in the United States reached a settlement in principle to resolve claims brought by Ven-A-Care of the Florida Keys, Inc. on behalf of the United States, Texas, Florida, and California under federal and state False Claims Acts.

Together with many other pharmaceutical manufacturers, Teva is named in numerous civil lawsuits that relate to drug price reporting by manufacturers in about 15 states. The cases, which are pending in federal and state courts, generally allege that the prices reported by pharmaceutical companies caused governments to pay inflated reimbursements for drugs under Medicaid or other programs. Teva denies the allegations.

Upon execution of definitive settlement documents and certain government and court approvals, the settlement will resolve a lawsuit relating to federal contributions to all state Medicaid programs and claims of Texas, Florida, and California relating to their Medicaid programs. The settlement will eliminate the majority of the alleged damages asserted against Teva in the various drug pricing litigations.

Teva will record a charge of approximately $315 million in its fourth quarter, 2009 results. This charge includes both the settlement in principle and a reserve for the remaining drug pricing lawsuits to which Teva is a party.

SOURCE StreetInsider.com

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