2023-08-15 15:46:02
A federal appeals court on Tuesday revived a lawsuit in which the United States and Virginia accused Walgreens Boots Alliance of falsely claiming that certain patients were eligible for Medicaid coverage for expensive hepatitis C drugs.
In a 3-0 decision, the 4th U.S. Circuit Court of Appeals in Richmond, Va., allowed the drugstore chain to face charges of violating the federal False Claims Act. and Virginia State law.
The case stems from accusations that between January 2015 and June 2016, a clinical pharmacy manager at a Walgreens in Kingsport, Tennessee, falsified patient records, including lab results, in order to obtain prior authorization from Virginia Medicaid for reimbursement of the drugs Sovaldi, Harvoni and Daklinza.
Kingsport’s store revenue increased by 321% during that period, according to court documents.
Walgreens opened an investigation into the alleged fraud, but did not reimburse money received for 12 Medicaid patients from Virginia, even following the manager pleaded guilty to a similar fraud in Tennessee.
In December 2021, a trial judge dismissed the governments’ lawsuit, saying Walgreens’ misrepresentations were immaterial because Virginia’s pre-clearance requirements violated federal law.
In his ruling on Tuesday, however, Judge Albert Diaz said Walgreens’ alleged misrepresentations were material under misrepresentation law because they “effectively influenced decision makers” at Virginia Medicaid.
He also said the largest drugstore chain in the United States might not escape responsibility by attacking Virginia’s eligibility requirements as illegal.
“Allowing Walgreens to escape liability by challenging Virginia’s eligibility criteria only following getting caught would frustrate the law’s purpose of holding fraudsters accountable,” Diaz wrote.
Walgreens did not immediately respond to requests for comment. The US Department of Justice and Virginia Attorney General did not immediately comment.
The case is: US et al v Walgreen Co, 4th US Circuit Court of Appeals, No. 22-1491.
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