TAP Pharmaceutical Products

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TAP Pharmaceutical Products was formed in 1977 as a joint venture between the two global pharmaceutical companies, Abbott Laboratories and Takeda Pharmaceutical Co. The company markets Prevacid (lansoprazole) and Lupron Depot (leuprolide acetate for depot suspension), both leaders in their classes.

Lupron Depot is indicated for the palliative treatment of advanced prostate cancer, for management of endometriosis, in combination with iron for the preoperative treatment of anemia caused by uterine fibroids, and for the treatment of children with central precocious puberty. For more detail see [1].

$875 million settlement with DOJ

On October 3, 2001 the DOJ announced that TAP Pharmaceutical Products agreed to pay the government a record $875 million to settle extensive civil and criminal charges of illegally marketing and manipulating the costs of Lupron under the Medicare and Medicaid programs.

The $875 million settlement broke down to:

$290 million for violating the Prescription Drug Marketing Act. $559.5 million to settle federal fraud charges for overcharging Medicare. $25.5 million reimbursement to 50 states and Washington, D.C., for filing false claims with the states' Medicaid programs.

The whistle-blowers of this case are Douglas Durand, a former TAP vice president of sales, and Dr. Joseph Gerstein. The government would pay Durand 14 percent of the $559.5 million Medicare portion of the settlement, or more than $78 million. Gerstein would receive 3 percent of the Medicare settlement, or more than $16 million.

For more detail, see [2], [3], [4], [5], [6].

[1] http://www.tap.com/prd_ldep.asp

[2] http://findarticles.com/p/articles/mi_m3257/is_12_55/ai_82481865

[3] http://www.insure.com/articles/lawsuitlibrary/tap-pharmaceuticals.html

[4] http://www.phillipsandcohen.com/CM/NewsSettlements/TAP_Oct3_2001.asp

[5] http://www.forbes.com/global/2005/0314/048.html

[6] http://www.businessweek.com/magazine/content/02_25/b3788094.htm