AstraZeneca has agreed to pay nearly $34 million to settle a lawsuit filed by the Texas Attorney General's office alleging that the pharmaceutical giant used illegal kickbacks to influence prescriptions paid for by Texas Medicaid. The settlement, announced on June 29, 2026, resolves claims that AstraZeneca provided free nursing services and other inducements to healthcare providers in exchange for prescribing its drugs, resulting in millions of dollars in tainted Medicaid claims.
Texas Attorney General Ken Paxton secured the settlement under the Texas Health Care Program Fraud Prevention Act. The state alleged that AstraZeneca provided free nursing services and reimbursements to healthcare providers 'under the guise of non-branded counseling' to influence them to prescribe the company's drugs. Many of these prescriptions were covered by Medicaid, leading to 'millions of dollars in claims to Texas Medicaid that were tainted by AstraZeneca's illegal inducements.'
The Alleged Kickback Scheme
According to the complaint, AstraZeneca's kickback scheme took the form of a free network of nurses and insurance support services designed to boost prescriptions of its medicines. By providing these services, the company allegedly helped manage key aspects of patient care that a physician would otherwise have to handle or pay staff to perform. The state argued that these inducements prompted pharmacies, pharmacy benefit managers, and others to submit claims to Texas Medicaid for AstraZeneca's medicines, causing the program to disburse millions of dollars in unauthorized reimbursements.
Texas has filed similar lawsuits against other major pharmaceutical companies over the last year, including Eli Lilly and Sanofi, for providing free nurses and paid third parties alleged to have steered patients to those companies' products. In supplying these healthcare professionals, the companies can manage the care of patients in place of independent physicians. A decade ago, Lilly and Novo Nordisk faced similar allegations of using nursing services and 'white coat' sales schemes to influence the marketing of their insulin products.
Settlement Terms and State Response
Under the settlement, AstraZeneca will pay $33,998,000 to resolve the state's claims. The agreement is the 'result of a mutual desire to settle their disputes amicably and to avoid the delay, expense, litigation costs, inconvenience, and uncertainty of protracted litigation,' according to the settlement document. AstraZeneca did not admit to any wrongdoing as part of the settlement.
Texas Attorney General Ken Paxton said in a statement: 'I will not allow Big Pharma to misuse taxpayer dollars to put profit ahead of Texans' health. My office will continue aggressively pursuing healthcare fraud to protect taxpayer dollars and the integrity of our healthcare system.' Paxton, who is currently running for Senate, announced the settlement in a press release on June 29.
Wider Context and Implications
The settlement follows a similar Texas lawsuit against Eli Lilly, which the state accused of using free nurse and reimbursement-support programs to steer providers toward prescribing its drugs, including the GLP-1s Mounjaro and Zepbound, tainting Texas Medicaid claims. The AstraZeneca case is part of a broader crackdown by Texas authorities on pharmaceutical companies' marketing practices, particularly those involving free services provided to healthcare providers. The state has signaled that it will continue to aggressively pursue healthcare fraud cases against drug manufacturers.
