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India's Ranbaxy to pay $40 million to settle Texas Medicaid pricing litigation
MUMBAI
A general view of the office of Ranbaxy Laboratories is pictured at Gurgaon, on the outskirts of New Delhi, June 13, 2013.
CREDIT: REUTERS/ADNAN ABIDI
(Reuters) - Indian generic drugmaker Ranbaxy Laboratories Ltd said it has agreed to pay $39.75 million to settle litigation concerning its participation in Texas Medicaid, the U.S. federal-state healthcare program for people with low incomes.
The litigation related to the manner in which Ranbaxy historically reported pricing data to Texas Medicaid for some drugs, Ranbaxy said in a statement on Thursday. The payments will be made in tranches through August 2015, it said.
Ranbaxy in May said, without elaborating, it had made a provision of 2.38 billion rupees ($38.57 million) in its first quarter results for "certain settlements done with the government authorities" in the United States.
Last month, the company said U.S. federal authorities had sought details on how it reported pricing data for some products eligible for reimbursement under Medicaid.
Analysts on Thursday said they did not expect any future impact on Ranbaxy's earnings from the Texas settlement, citing the provision.
The company, which is in the process of being acquired by larger rival Sun Pharmaceutical Industries Ltd, said it "believes it fully complied with all the relevant laws."
Ranbaxy's Texas settlement comes after the company pleaded guilty last year to felony charges relating to drug safety. It agreed to pay $500 million in civil and criminal fines under a settlement agreed with the Department of Justice.
Ranbaxy shares were up 0.6 percent at 602.50 rupees at 1.32 a.m. EDT in Mumbai. The broader NSE index was down 0.08 percent.
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