Attorney General Madigan: Walgreens Must Pay $50 Million for Unlawful Prescription Marketing Scheme

CHICAGO, Feb. 8 -- Illinois Attorney General Lisa Madigan issued the following news release:

Attorney General Lisa Madigan today announced Illinois has joined at least 30 other states and the federal government to settle allegations that Walgreen Co. unlawfully solicited and persuaded Medicare and Medicaid recipients to enroll in its "Prescription Savings Club" in order to gain more profitable customers, which was in violation of federal and state anti-kickback laws.

Walgreen Co., headquartered in suburban Deerfield, enticed Medicare and Medicaid patients with savings, coupons and other offers to join the company's prescription savings club, which amounted to an unlawful marketing scheme. Walgreens will pay the states and the federal government $50 million, of which nearly $8.5 million will go to state Medicaid programs. The remaining portion of the settlement is attributed to Medicare and Tricare programs. Illinois will receive more than $740,000 in restitution and other recoveries from the settlement.

"Walgreens disregarded the law when the company targeted Medicare and Medicaid recipients," Madigan said. "This kind of blatant corporate misconduct will not be tolerated."

The investigation resulted from a false claims action originally filed in January 2012 in the United States District Court for the Southern District of New York under the federal False Claims Act and various state false claims statutes.

Deputy Bureau Chief Heather Tullio D'Orazio with Madigan's Medicaid Fraud Bureau led a National Association of Medicaid Fraud Control Units (NAMFCU) team that participated in the investigation and conducted the settlement negotiations with Walgreen Co. on behalf of the states. Other members of the team included representatives from the following attorneys general offices: California, Indiana, Massachusetts, Michigan and New York. Madigan's office works in conjunction with the Illinois State Police Medicaid Fraud Control Bureau to investigate and prosecute civil and criminal cases of Medicaid Fraud.

"We strongly believe this executive order violates both core constitutional principles and federal law, and we are proud to join with our fellow states in opposing its implementation in this case as well as the 9th Circuit case," District of Columbia Attorney General Karl A. Racine said. "The District of Columbia, like all of our jurisdictions, is a city that has always thrived thanks to the hard work of immigrants and the educational and scientific resources that visitors and temporary residents from nations all over the world bring to our city every day. We will continue to fight for basic American principles of equal protection, religious freedom, and welcoming people from all nations and cultures."

"The Trump Administration's Executive Order is not only a policy that is unwise and dangerous, but it is a policy that is inhumane, inappropriate and un-American," Maryland Attorney General Brian E. Frosh said. "As Attorneys General, collectively we will use our authority to protect the business community, educational institutions, and our citizens from this unconstitutional order."

"As Attorneys General, our primary job is to protect the people we represent," New York Attorney General Eric T. Schneiderman said. "President Trump's immigration ban represents an all-out assault on the rights of New Yorkers, on our economy and businesses, and on our educational and healthcare institutions. My fellow Attorneys General and I will continue to do everything in our power to strike down this unconstitutional, discriminatory, and chaotic order, and prevent further harm to the people we serve."

"President Trump's executive order undermines the core American value of religious tolerance, and it makes us less safe," North Carolina Josh Stein said. "It signals to the world that America sees all Muslims as terrorists, strengthening ISIS's propaganda and efforts to recruit terrorists. That is why I will join my colleagues in taking action."

"We will continue to review each lawsuit filed to determine how best we can, individually and collectively, stop the President's ill-conceived, immoral, and unconstitutional executive order," Rhode Island Attorney General Peter F. Kilmartin said. "As a state and a nation, we benefit academically, culturally and economically from the many immigrants that make up our communities. This executive order not only has a chilling effect on those communities but also on our academic institutions and our economy."

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