McKesson pays $18 million over allegations that it violated CDC shipping contract

by Ben Vernia | August 11th, 2014

On August 8, the Department of Justice announced that McKesson Corp. submitted false claims for knowingly failing to comply with temperature control requirements on shipments under contract with the Centers for Disease Control and Prevention. According to DOJ’s press release:

McKesson Corporation 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 Justice Department announced today. McKesson is a pharmaceutical distributor with corporate headquarters in San Francisco.

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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. For more information about vaccine storage and handling, please visit the CDC website or contact the CDCs press office at 404-639-3286 and .

The case was launched by a qui tam whistleblower, DOJ announced. The relator, a former finance director at a McKesson subsidiary, will receive an as-yet-to-be-determined amount of the settlement proceeds.

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