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Government investigations of drug pricing expand

The Wall Street Journal reported on June 7, 2005 that state and federal prosecutors are investigating 150 cases involving alleged drug pricing fraud.

The article claims that the investigations could result in more than $1 billion in criminal fines and civil penalties this year.

The focus is on allegations that drug companies inflate prices, offer undisclosed rebates to distributors, and market drugs for unapproved uses. Prescription drugs constitute a significant portion of the nation’s health care expenditures and changes in Medicare will result in the federal government assuming a larger share of that cost.

The Wall Street Journal article is available to subscribers.

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