Sepracor Inc, Marlborough, Mass, the maker of Lunesta, a drug indicated for
the treatment of insomnia, will be conducting a review of its government
price reporting. The company notified the Centers for Medicare and Medicaid
Services (CMS) that it had identified potential errors in its Medicaid Best
Price for products reimbursed under the Medicaid Drug Rebate Program.
The company also notified CMS regarding instances in which it appears that
it provided a price reserved for qualified public health service (PHS)
covered entities to customers who were not qualified to receive this PHS
price. PHS prices provided to qualified entities are exempt from the Best
Price calculation.
Based on the review’s outcome Sepracor may be required to revise the prices
reported under its federal Medicaid rebate agreement, other federal
programs, and certain state agreements, and pay the corresponding additional
rebate amounts or other amounts due under those programs for the period 2002
through 2007. If the company is required to make such payments, it estimates
that the aggregate amount of any additional rebate payments and other
amounts due for this 6-year period will be between $80 million and $100