AG Nessel: Agreement reached with Holland pharmacy accused of price gouging

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Posted at 4:14 PM, Mar 21, 2022
and last updated 2022-03-21 23:30:51-04

LANSING, Mich. — An Ottawa County pharmacy accused of price gouging has reached an agreement with Michigan Attorney General Dana Nessel.

Back in February, Nessel issued a notice of intended action (NIA) to Skip’s Pharmacy in Holland following complaints related to an at-home COVID-19 test kit being sold for far more than it should.

RELATED: Holland pharmacy accused of price gouging

Nessel also issued a notice of intended action to pharmacies in Madison Heights and Birch Run.

AG Nessel says she received complaints from consumers against Value Center Pharmacy in Madison Heights and Skip’s Pharmacy.

Skip’s Pharmacy and Value Center Pharmacy attempted to justify to prices of the kits by providing invoices showing how much they had paid to buy them from the third company, Birch Run Drugs.

Monday, Nessel announced she had reached an Assurance of Voluntary Compliance (AVC) agreement with the pharmacies.

Under the agreement, the pharmacies agreed to sell the remaining inventory of iHealth COVID-19 Antigen Rapid Test kits for $12.99 per box, except where a consumer’s insurance plan reimburses at a pre-set amount. They also agreed to pay $100 each to the two complainants that prompted the investigation, as well as $1,000 to the department to be used as restitution for consumers who can provide documentation showing they paid an excessive price for an iHealth test kit between Dec. 1, 2021, and Feb. 28, 2022, from one of the four pharmacies covered by the AVC.

To be considered for reimbursement, you must file an online complaint with the department in the next 60 days. Nessel says her Consumer Protection Team will then reach out to you for proof of purchase.

“My Consumer Protection Team continues to secure positive results for Michigan consumers,” Nessel said. “Let it be clearly understood that I will hold accountable businesses that exploit the ongoing pandemic for monetary gain.”

Pharmacy owner Murali Ginjupalli issued the following statement about the situation Monday:

"We have worked cooperatively with the Michigan Attorney General’s office to resolve this matter, and we are pleased to have reached a voluntary agreement. It’s important to note that our pharmacies provided COVID-19 tests at a critical time during the height of the omicron surge. Tests were in short supply at this point, and our pricing reflected that – much in the same way the current surge in gas prices reflects the uncertainty over distribution and availability of fuel. Tests we procured and then sold enabled life to continue, allowing people to go to work, children to attend school and families to gather together – all safely because of available testing."

"It's also important to note the AG did not levy any fines in this matter. We are in process of reimbursing two consumers who complained. In the spirit of continued cooperation, we have agreed to limit the prices of test we are selling directly to consumers – although the price of tests has been eroded because of government programs that have finally caught up to demand," Ginjupalli explained.

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