Douglas County commissioners Monday agreed to file a lawsuit against a major pharmaceutical distributor and another company, alleging a scheme to inflate wholesale prices of prescription drugs.
Commissioners expect their claim for damages against McKesson Corporation and First DataBank Inc. to become part of a class-action lawsuit in federal court, filed in Boston.
Commissioners allege prescription drugs rates were too high in 2008 and several years before, said Evan Ice, the county's counselor. The county is self-insured, and commissioners each year set aside funds to pay employees' health care claims.
After an executive session, Commissioners Charles Jones and Bob Johnson voted to retain the law firm Kotchen and Low of Washington, D.C. Attorneys for Lawrence-based Stevens and Brand will serve as local counsel.
Commissioner Jere McElhaney abstained because he said he has a relative who works in the pharmaceutical industry. He also said he does not support class-action lawsuits.
A similar federal lawsuit was filed in 2005 in Boston alleging the same two companies artificially inflated prescription drug prices from 2001 to 2005. That lawsuit is pending, but in court filings defense attorneys have denied the allegations.
As for the new case, attorney Chris Burger of Stevens and Brand told commissioners the Washington law firm wants the county's lawsuit on file by today in federal court in Massachusetts. He said attorneys can seek class certification in the lawsuit over the next two months.
Jones said the county is seeking damages in excess of $75,000.
According to the agreement, Kotchen and Low will receive 30 percent of any net recovery of either settlement, award or judgment after deducting costs and expenses.
"It's a no-lose proposition for the county. Hopefully, we'll recover some of the damages that have been incurred," Johnson said.
Burger said attorneys have until October to discuss a settlement.
Johnson participated in the executive session and meeting by conference call.