CONCORD — Attorney General Michael A. Delaney said Friday that New Hampshire will receive $1.7 million from a national settlement with a major drug company whose wholesale drug pricing caused the state's Medicaid program to overpay for a large number of prescription drugs betweeen late 2001 and March 2005.

New Hampshire is one of 30 states that will share in the settlement with McKesson Corp.

The national settlement resolved allegations that McKesson violated the Federal False Claims Act and various state false claims acts, by reporting inflated pricing data for a large number of prescription drugs.

As a result of the inflated pricing data reported, New Hampshire's Medicaid program overpaid for the drugs during that period.

Medicaid is funded jointly by the federal government and New Hampshire. In April, the federal government settled the federal portion of this lawsuit for more than $187 million; this agreement recovers the state Medicaid share for New Hampshire.

The drug pricing data at issue in this settlement concerns the Average Wholesale Price (AWP) benchmark used by most states, including New Hampshire, to set pharmacy reimbursement rates for pharmaceuticals dispensed to state Medicaid beneficiaries. The state and federal governments alleged that McKesson, one of the largest drug wholesalers in the country, reported inflated AWP pricing data to First Data Bank (FDB), a publisher of drug prices, thereby inflating many AWPs that are used by the states to set reimbursement.

New Hampshire and the 29 other states which joined the lawsuit were represented by a national settlement team comprised of members from the states of California and New York working through the National Association of Medicaid Fraud Control Units.