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Attorney general returns nearly $4 million in Medicaid fraud recovery to General Fund

RICHMOND (October 5, 2012) -- Attorney General Ken Cuccinelli announced to state legislators today that he will turn over a check to the General Fund for nearly $4 million, which represents Virginia's share of proceeds from the civil recovery portion of a settlement with pharmaceutical company Abbott Laboratories to settle allegations of off-label marketing of its drug, Depakote. The money is to compensate the commonwealth for reimbursements it paid under the Medicaid program for the drug.

This is the second Medicaid fraud recovery return in the last 60 days. On August 28, the attorney general announced to state legislators that Virginia's MFCU would turn over a check to the General Fund for $8.6 million, which represented Virginia's share of proceeds from a global settlement between pharmaceutical company GlaxoSmithKline (GSK) and Virginia, the United States, and other state governments to settle allegations of Medicaid fraud.

Virginia's Medicaid Fraud Control Unit (MFCU) was the lead investigative agency in the $1.5 billion case between Abbott and Virginia, the United States, and other state governments.

The settlement check is currently being processed for deposit into the General Fund's Healthcare Account for use by the Virginia Department of Medical Assistance Services for Virginia's Medicaid program.

In May, Attorney General Ken Cuccinelli and Deputy U.S. Attorney General James Cole announced that global health care company Abbott Laboratories Inc., had pleaded guilty and agreed to pay $1.5 billion to resolve its criminal and civil liability arising from the company's unlawful promotion of the prescription drug Depakote for uses not approved as safe and effective by the Food and Drug Administration (FDA). The resolution includes a criminal fine and forfeiture totaling $700 million and civil settlements with the federal government and the states totaling $800 million.  Abbott was sentenced in Abingdon on October 2. 

The difference between the $3,974,975.62 check and the $4.2 million recovery reported in previous news releases is the portion that goes to the whistleblowers who brought the allegations to the MFCU's attention, pursuant to the Virginia Fraud Against Taxpayers Act.

Abbott will also pay $1.5 million to Virginia MFCU to cover its investigative costs as the lead investigative agency in the case.

More details on the Abbott case can be found here.

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A copy of this news release may be found on the attorney general's web site here.

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