Boots parent company Walgreens Boots Alliance (WBA) and sister company Walgreens will jointly pay a $106.8 million (roughly £80.9m) settlement for submitting “false claims” to government healthcare programmes for prescriptions that were not dispensed, the US department of justice announced last week (September 13). 

The huge settlement will “resolve” allegations brought by the US government that Walgreens “submitted false claims” for payment between 2009 and 2020, the government said.

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Instead of reversing the payment claim submitted to the government, Walgreens “restocked and resold the same prescription to someone else” and collected payment “twice”, according to a statement from the US attorney’s office for the middle district of Florida, also published on September 13.

The US government said that Walgreens scored “tens of millions of dollars” from US federal healthcare programmes such as Medicare and Medicaid for prescriptions that were “never dispensed”.

 

Bounty hunters rewarded

 

The US government settlement originated from legal action brought privately against Walgreens on its behalf by two former employees under the whistleblower provisions of the False Claims Act, it said.

Under these provisions, whistleblowers can receive a “share in any recovery” - former Walgreens pharmacy manager Steven Turck will receive $14.9m (~£11.3m) and former Walgreens district pharmacy supervisor Andrew Bustos will receive $1.6m (~£1.2m).

The federal government will receive $91.9m (~£69.6m), while $14.9m (~£11.3m) will be shared across “individual states”, it added.

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Walgreens has repaid $66m (~£50.23m) of the claims, for which it will be credited, the government said.

The US pharmacy chain has also committed to “enhancements” to its electronic pharmacy management system “to prevent this from occurring in the future”, it added.

“Providers who prey upon public health care programs to increase profit margins must be held accountable,” said Christian J. Schrank, deputy inspector general for investigations at the US department of health.

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US attorney for the middle district of Florida Roger B. Handberg called the settlement a “major achievement” in the government’s efforts against “healthcare fraud”.

And US attorney for the district of New Mexico Alexander M.M. Uballez said that “fraudulently billing” federal healthcare programmes like Medicaid and Medicare for prescriptions “endangers the integrity of these critical programmes”.

Read more: Boots boss Seb James quits pharmacy giant amid ongoing closures

A spokesperson for Walgreens told C+D today (September 16) that the US multiple had "inadvertently" charged the government healthcare programmes "for a relatively small number of prescriptions" due to a "software error".

The spokesperson said that Walgreens had "corrected the error, reported the issue to the government and voluntarily refunded all overpayments".

"We appreciate the government acknowledged our compliance efforts as part of resolving this matter," the spokesperson told C+D.

 

Boots bulletin

 

Last week, WBA announced that it has appointed Anthony Hemmerdinger, who originally joined the business as a teenage Saturday jobber, as its replacement managing director of Boots UK and Ireland.

Hemmerdinger will replace Seb James, who announced his exit in July after six years at the head of the UK’s largest pharmacy multiple.

Read more: Revealed: Boots planning up to 69 more store closures across UK

James announced his departure days after WBA revealed that it may close up to 69 more Boots stores as part of its years-long cost reduction plan.

And in August, WBA revealed that it had sold $1.1 billion-worth of shares in American drug wholesale company Cencora, using the cash for a “debt paydown” and to create more “capital-efficient” retail pharmacies.