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FOR IMMEDIATE RELEASE
May 20, 2013
Drug company pays $500 million to resolve adulterated drugs claims

OLYMPIA—Washington has joined with other states and the federal government in a $500 million dollar settlement to resolve civil and criminal allegations against Ranbaxy, a generic pharmaceutical manufacturer based in Gurgaon, India. The company is alleged to have introduced adulterated—or tainted— drugs into interstate commerce, resulting in false or fraudulent claims being submitted to Washington’s Medicaid Program.

The investigation resulted from a qui tam action filed in the U.S. District Court for the District of Maryland under the federal False Claims Act and various state false claims statutes.  Under a qui tam action, an individual who assists in a prosecution may share in the recovery.

In this case, the whistleblower’s complaint alleged that Ranbaxy knowingly manufactured, distributed and sold generic pharmaceutical products – whose strength, purity and/or quality fell below the standards required by the U.S. Food and Drug Administration.  The products at issue consisted of 26 generic pharmaceutical products manufactured at Ranbaxy’s facilities in Paonta Sahib and Dewas, India, at various times between April 1, 2003 and September 16, 2010.

Ranbaxy has agreed to pay the states and the federal government $350 million dollars in civil damages and penalties to resolve civil allegations of poor manufacturing practices in two Indian manufacturing plants— $266.7 million of which will go to the Medicaid programs, which are funded jointly by the states and the federal government.  Washington’s state and federal recovery is $2.7 million of which $1.3 million is the state’s share.  The remaining $83.3 million is designated for other federal health care programs affected by Ranbaxy’s conduct. 

Ranbaxy USA, a subsidiary, also pled guilty to seven felony counts alleging violations of the U.S. Food, Drug, and Cosmetic Act, and has agreed to pay $150 million dollars in criminal fines and forfeitures. 

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Contacts: Janelle Guthrie, Director of Communications, (360) 586-0725

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