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AVERAGE WHOLESALE PRICE (AWP)

Drug prices have been soaring for years. One of the reasons is drug companies' publication of a fictional price called Average Wholesale Price, or AWP. While AWP was originally intended to represent the price that drug wholesalers purchased drugs from pharmaceutical manufacturers, many drug companies have manipulated that price so that federal and state governments, third party payors and consumers have vastly overpaid for drugs. To address this conduct, during early 2002, WW initiated a wave of class-actions nationwide against the dominant pharmaceutical manufacturers to immediately stop the fraudulent publication of AWP and return overpayments to consumers and other payors. These cases, which were consolidated in Boston, Massachusetts, allege that pharmaceutical manufacturers like Abbott, AstraZeneca, Bristol-Myers Squibb, Baxter and GlaxoSmithKline routinely inflated the AWP they report to price publications, causing third-party payors and consumers, many of whom are sick and elderly, to vastly overpay for them.

Plaintiffs tried the case under Massachusetts law against four defendants. The 9-week trial resulted in a 183-page opinion by the district court largely finding in favor of Plaintiffs. Plaintiffs have asked the district court to allow them to try their cases against AstraZeneca and Bristol Myers-Squibb under the consumer protection statutes of states throughout the country. Plaintiffs expect a decision on their request in a few months.

Issue:

While AWP was originally intended to represent the price that drug wholesalers purchased drugs from pharmaceutical manufacturers, many drug companies have manipulated the AWP so that federal and state governments, third party payors, and consumers have vastly overpaid for drugs. To address this conduct, during early 2002, WW initiated a wave of 14 class actions nationwide against the dominant pharmaceutical manufacturers to immediately stop the fraudulent publication of AWP. These cases, which were consolidated in Boston, Massachusetts, alleged that pharmaceutical manufacturers like Abbott, AstraZeneca, Bristol-Myers Squibb, Baxter and GlaxoSmithKline, routinely inflate the AWP they report to trade publications, causing those who purchase and reimburse for drugs to vastly over pay for them.

Date Filed: April 26, 2007

Court: U.S. District Court

Location: Massachusetts

Case No: 01-cv-12257

Judge: Honorable Patti B. Saris

Class Certification: August 16, 2005

Current Status:

WW and its co-counsel proceeded on a class wide basis against the defendant drug companies for their conduct with regard to physician-administered drugs, or drugs that are administered in the form of an injection as opposed to a pill. The trial against four of the largest defendants began in November 2006 concluded January 26, 2007.

Case Significance:

The case is currently on appeal in the 1st Circuit Court to grant order of certification for other states besides Massachusetts. The parties are expecting a written ruling from Judge Saris by August of this year.

If you or someone you know has been injured by unfair and fraudulent practices from the AWP, please contact an attorney today.