Priority Healthcare Settles Diabetes Test Lawsuit with Roche for $43 Million

Priority Healthcare will pay Roche Diagnostics $43.3 million to settle a lawsuit alleging that it fraudulently submitted claims to insurers and pharmacy benefit managers for Roche’s Accu-Chek blood glucose test strips that put Roche on the hook for tens of millions of dollars.

Roche claimed in its 2018 complaint that it had to pay more than $37.5 million in “unwarranted” rebates to insurance companies and PBMs for blood-glucose testing strips that either were different, pricier versions of the test strips patients actually received or were not shipped to patients at all. Roche also contended that Priority Healthcare’s efforts to introduce new pharmacies caused it to pay millions of dollars per year in unwarranted rebates for the tests.

“[Priority Healthcare] misrepresented, caused to be misrepresented, and/or conspired to misrepresent to insurance companies and PBMs that they were selling Roche’s retail blood-glucose test strips, when in fact they were not,” Roche alleged in its complaint. “These misrepresentations were passed along by the insurance companies to Roche, directly causing Roche to pay the insurers millions of dollars in unwarranted rebates.”

The settlement, which requires the Alabama pharmacy operator to pay Roche $43.3 million dollars, also bars the corporation from purchasing, selling, distributing or dispensing Accu-Chek test strips.