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PENNSYLVANIA TO BENEFIT FROM PROPOSED SETTLEMENT OF CLOZARIL CASE

 PENNSYLVANIA TO BENEFIT FROM PROPOSED SETTLEMENT OF CLOZARIL CASE
 HARRISBURG, Pa., Sept. 3 /PRNewswire/ -- State agencies and individuals who purchase the antischizophrenia drug Clozaril would receive $16 million in refunds and credits under a proposed national settlement of antitrust charges brought by Pennsylvania Attorney General Ernie Preate Jr. and other attorneys general.
 Preate said the Department of Public Welfare, the primary purchaser in Pennsylvania, would get more than $1 million in refunds and credits under the agreement.
 "This settlement is good news for those persons suffering from schizophrenia whose lives are improved through treatment with Clozaril," Preate said.
 "It also sends a strong message to the pharmaceutical industry that we will not tolerate anticompetitive marketing programs that illegally hike prices for medical treatment."
 Named as defendants in related suits filed by several states in December 1990 were Sandoz Pharmaceuticals Corp., manufacturer of Clozaril (generic name clozapine), and Caremark Inc.
 The attorneys general charged that Sandoz's requirement that Clozaril buyers purchase a package of blood monitoring and lab-testing services from Caremark as a condition of getting the drug artificially inflated the drug's price.
 In response to the suit, Sandoz and Caremark ended their exclusive arrangement last year, Preate said. He noted that as part of the settlement, the defendants have agreed to a court order barring them from reinstating the tying arrangement.
 "Most treatment of schizophrenia occurs in state-funded or state- operated institutions, and as a consequence, the Department of Public Welfare has been the largest purchaser of Clozaril in Pennsylvania," Preate said.
 Under the agreement, the Welfare Department will get about $1 million in refunds for past Clozaril purchases and $172,800 in credits toward future purchases.
 In addition, others who bought Clozaril in Pennsylvania from February 1990 through May 1991 are entitled to a refund or credit of $38.92 for each week they purchased the drug.
 "In these days of ever-increasing medical costs, law enforcers must be on guard against schemes that restrict access and raise the price of drugs and medical services," Preate said.
 "We believe Clozaril was only the first of several drugs which the industry intended to sell through these kinds of exclusive marketing programs.
 "While the federal government gives pharmaceutical companies patents and exclusive marketing rights to encourage them to develop new drugs, this case tells the industry we won't tolerate abuse of these temporary monopolies."
 The states' suits were filed in the U.S. District Court for the Southern District of New York in Manhattan. The suits were moved to the Northern District of Illinois in Chicago, where the settlement will be reviewed by U.S. District Court Judge Harry D. Leinenweber.
 The states today took the first step in obtaining court approval by filing a motion for preliminary approval.
 Sandoz Pharmaceuticals, the U.S. subsidiary of Sandoz Ltd. of Basle, Switzerland, is headquartered in East Hanover, N.J. Caremark Inc. is based in Lincolnshire, Ill.
 Deputy Attorney General James A. Donahue III represented Pennsylvania in the lawsuit.
 /delval/
 -0- 9/3/92
 /CONTACT: Jack J. Lewis, assistant press secretary of the Office of Attorney General, 717-787-5211, or at home, 717-657-9840/ CO: Pennsylvania Department of Public Welfare; Sandoz Pharmaceuticals
 Corp.; Caremark Inc. ST: Pennsylvania, New York, Illinois, New Jersey IN: MTC SU:


CC -- PH012 -- 6524 09/03/92 14:59 EDT
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Publication:PR Newswire
Date:Sep 3, 1992
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