McKesson Corp, False Claims, California 2007

The government alleged that Mckesson failed to comply with the shipping and handling requirements of its vaccine distribution contract with the CDC. Under the contract, Mckesson provided distribution services, receiving vaccines purchased by the government from manufacturers and then distributing the vaccines to health care providers.

The government alleged that the contract required Mckesson to ensure that during shipping, the vaccines were maintained at proper temperatures by, among other things, including electronic temperature monitors set to detect when the air temperature in the box reached two degrees Celsius and below or eight degrees Celsius and above.

The government alleged that, from approximately April 2007 to November 2007, Mckesson failed to set the monitors to the appropriate range, and as a result, knowingly submitted false claims to the CDC for shipping and handling services that did not satisfy its contractual obligations.

According to the CDC, redundant measures were and are used to ensure vaccines are kept at appropriate temperatures during shipping. The most important of these were validated packing procedures used to maintain proper vaccine temperatures. Temperature monitors provided a secondary safeguard.

Mckesson Corp, a pharmaceutical distributor with corporate headquarters in San Francisco, has agreed to pay $18 million to resolve allegations that it improperly set temperature monitors used in shipping vaccines under its contract with the Centers for Disease Control and Prevention (CDC). The allegations resolved by today’s settlement were originally raised in a lawsuit filed against Mckesson by Terrell Fox, a former finance director at Mckesson Specialty Distribution LLC, under the qui tam, or whistleblower, provisions of the False Claims Act.

The Justice Department’s Civil Division praised the settlement, stating that companies must comply with the requirements they agree to when they contract with the government to provide products that protect the public. If a contractor does not adhere to the terms it negotiated, its conduct not only hurts taxpayers but also could jeopardize the integrity of products, like vaccines, that Americans count on to be safe.

Mckesson Corp is a pharmaceutical distributor with corporate headquarters in San Francisco. The allegations resolved by today’s settlement were originally raised in a lawsuit filed against Mckesson by Terrell Fox, a former finance director at Mckesson Specialty Distribution LLC, under the qui tam, or whistleblower, provisions of the False Claims Act.

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