Eight Years of Rigged Drug Prices Charged to the VA: $124M

King misreported the price figures that set federal drug prices — “systemic and widespread,” across its entire product line — overcharging VA/Federal Supply Schedule buyers from 1994 to 2002. $124M plus interest.

From 1994 to 2002, King allegedly misreported the Average Manufacturer Price and Best Price figures used to calculate Medicaid rebates and the ceiling prices charged to federal buyers, including the VA.

DOJ said the misreporting was "systemic and widespread," stemmed from absent internal controls, and covered King’s entire product line. The settlement specifically resolves claims that King "overcharged for purchases of its drug products from the VA/Federal Supply Schedule."

The case was brought by a whistleblower — a former King contracts director. The settlement bundles Medicaid rebate underpayments with the federal-buyer overcharges; a VA-only portion is not separately stated. A settlement of allegations, not a conviction.

"overcharged for purchases of its drug products from the VA/Federal Supply Schedule"
— U.S. Department of Justice, Office of Public Affairs (archive)

Source: U.S. Department of Justice, Office of Public Affairs (archive). Case file in the VA Fraud case files — part of the VA Fraud record. Cases are published as the courts decided them; amounts are stated as the Justice Department states them (billed, stolen, or ordered in restitution, as labeled).