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Boies, Schiller & Flexner LLP, and the U.S. Government Settle $155 Million False Claims Act Case Against Medco

November 6, 2006

Short Hills, NJ, November 1, 2006, – Boies, Schiller & Flexner, LLP, and the United States Government have announced a $155 million settlement of a False Claims Act case against Medco Health Solutions, Inc. ("Medco") of Franklin Lakes, New Jersey. Medco is the second largest pharmacy benefit management company in the U.S., and is responsible for managing the prescription drug benefits of over 60 million Americans, including millions of Medicare beneficiaries. The settlement is one of the largest False Claims Act settlements to date, and will have lasting impact on the way Medco and other pharmacy benefit managers conduct their business in the future.

David Boies, Chairman of Boies, Schiller & Flexner, LLP, said, "I am very happy that lawyers from Boies, Schiller & Flexner were able to contribute to the litigation and settlement of this qui tam case, which will result in important changes in the way pharmacy managers do business by increasing their level of accountability to their patients. We are also very happy we could help the government recover the money it was erroneously billed by Medco, and that Medco agreed to execute a Corporate Integrity Agreement which will govern their conduct in the future."

Relator Dr. Joseph Piacentile first filed a qui tam action pursuant to the False Claims Act against Medco in 2000. Dr. Piacentile subsequently retained the law firm of Boies, Schiller & Flexner to assist the United States Department of Justice and the United States Attorney's Office for the Eastern District of Pennsylvania in order to prosecute, mediate, and eventually settle the case.

The qui tam complaint filed by Dr. Piacentile alleged, among other things, that Medco systematically and intentionally switched patients' prescriptions in an effort to increase the market share for certain pharmaceutical manufacturers, and thereby increased hidden rebate payments it received from pharmaceutical manufacturers. Dr. Piacentile's complaint was consolidated with the complaint of two other Relators, Walter W. Gauger and George B. Hunt, and the United States Government intervened in both actions and subsequently filed an Amended Complaint against Medco.

The Boies, Schiller & Flexner team was led by litigator David Stone, head of the Firm's False Claims Act Practice Area. Stone has over a decade of experience in the False Claims Act area and is Administrative Partner of the Firm's New Jersey office. The Boies, Schiller & Flexner team, which included Robert Magnanini, William Hurlock, Richard Drubel and Tim Cornell, assisted the Government in reviewing over 9 million pages of documents, interviewing hundreds of witnesses, taking and defending depositions and drafting numerous discovery requests and thousands of pages of motions and briefs.

In Mr. Stone's words, "The exploitation of private and public sources which provide prescription drugs to American citizens is a serious problem. With the passage of federal legislation requiring Medicare to provide wide coverage for most prescription drugs, the issue is of increasing importance. The Medco case was the first in a series of cases our Firm intends to bring to improve the quality of healthcare and prescription drugs provided to the Government and the public, and to ensure that the services and products are fairly priced."

Boies, Schiller & Flexner LLP, founded in 1997, has become one of the nation’s premier law firms. It has approximately 240 lawyers in offices located in New York, Washington, D.C., California, Florida, New Hampshire and Las Vegas. Best known for landmark cases such as United States v. Microsoft, Bush v. Gore, and In re Vitamins, the firm represents some of the largest and most sophisticated organizations in the world in their most important matters. The firm has been described by The Wall Street Journal as a “national litigation powerhouse” and by the National Law Journal as “unafraid to venture into controversial” and “high risk” matters. Boies, Schiller & Flexner can be visited on the web at

Related Lawyers: , Richard B. Drubel Jr., , ,

Related Practices: , Litigation