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Pfizer and its Wyeth unit have agreed to pay $784.6 million to resolve allegations that Wyeth overcharged the government by hiding the discounts it was giving hospitals.

The hidden discounts deprived Medicaid of "hundred of millions of dollars" in rebates from 2001 to 2006, according to a statement Wednesday from U.S. Attorney Carmen Ortiz in Boston. The government said the companies did not deny its claims.

Pfizer, which acquired Wyeth in 2009, previously announced the agreement in February. The agreement covers two forms of Protonix, which is used as an antacid.

"This settlement demonstrates our unwavering commitment to hold pharmaceutical companies responsible for pursuing pricing schemes that attempt to manipulate and overcharge federal health care programs," Benjamin C. Mizer, deputy assistant attorney general at the Department of Justice, said in a separate statement.

Medicaid requires pharmaceutical companies to give discounts on drugs that are related to the best prices they give other purchasers. Drugmakers have in the past been accused of hiding or manipulating those prices to avoid or decrease the discounts they give to the program.

"We are pleased to have finalized the agreement to resolve these cases, which involve historic conduct that occurred at least 10 years ago, before we acquired Wyeth," said Pfizer General Counsel Doug Lankler in a statement.

The settlement resolves a case filed under the False Claims Act, which allows citizens to sue on behalf of the government and share in any recovery. Two whistle-blowers, Lauren Kieff and William St. John LaCorte, will share $98.1 million, according to the Justice Department.

Kieff is a former hospitals sales representative for AstraZeneca and LaCorte is a physician in New Orleans. LaCorte first filed a lawsuit in 2002 and Kieff sued in 2003, according to a settlement agreement.

LaCorte claimed that Wyeth sold Protonix Oral tablets to hospitals for as low as 16 cents per tablet while not reporting that price to federal programs.