Roche sues US execs, says diabetes test strips fraudulently resold

Roche has sued more than a dozen former executives at Alliance Medical Holdings over what the drugmaker calls fraudulent schemes involving its diabetes test strips, according to Reuters.

The drugmaker claims the executives obtained low-priced diabetes strips intended for mail-order customers and sent them to pharmacies for resale, which allowed them to profit when the pharmacies marked up the price.

The drugmaker claims the practice caused Roche to wrongfully pay $87 million and to lose a similar amount of sales in retail strips.

The lawsuit, filed in U.S. district court in New Jersey, names several defendants, including Jeffrey Smith, former CEO of Alliance Medical Holdings.

In a separate lawsuit in Michigan, Roche alleges that executives at other medical supply companies used a similar scheme.

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