Cephalon to pay $425 million in settlement of Medicaid investigation

FRAZER, Pa. Cephalon won’t be able to cure the pain of lawsuit settlements with one of its drugs.

The sleep- and pain-medication producer said yesterday that it would pay $425 million to the federal government to settle an investigation of its sales and marketing procedures.

The agreement follows an investigation of Medicaid claims by the United States attorney in Philadelphia, the company said. As part of the settlement, company will also enter into a corporate integrity agreement and plead guilty to a misdemeanor violation of federal prescription drug laws.

The Pennsylvania Turnpike Commission sued the company, maker of the sleep-disorder drug Provigil, in May over claims that Cephalon wanted to corner the market by delaying generic competition.