ABSTRACT - Bayer AG, in largest Medicaid fraud settlement, agrees to pay government $257 million and pleads guilty to criminal charge after engaging in what federal prosecutors say was scheme to overcharge for antibiotic Cipro; fraud involved selling Cipro to health care organization Kaiser Permanente at prices lower than company was charging Medicaid, in violation of federal law that requires drug makers to give Medicaid .rogram lowest price charged to any customer; Cipro bottles sold to Kaiser were relabeled with Kaiser's name and given different drug identification number to cover up fraud; Kaiser is not charged with any wrongdoing; prosecutors also announce that GlaxoSmithKline agrees to pay $87.6 million to settle civil charges that it overcharged Medicaid program for antidepressant Paxil and allergy spray Flonase; deal also involves relabeling medicines for Kaiser; money from settlements will be divided by federal and state governments, which jointly pay for Medicaid; portion will go to public health clinics, AIDS programs, and other groups that are allowed to buy medicines at Medicaid price; about $34 million of Bayer settlement will go to estate of late George J Couto, former Bayer executive who became whistle-blower; photo (M) In the largest Medicaid fraud settlement, Bayer agreed yesterday to pay the government $257 million and pleaded guilty to a criminal charge after engaging in what federal prosecutors said was a scheme to overcharge for the antibiotic Cipro.

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