Wal-Mart, Target settle prescription drug overcharging allegations in Mass.

BOSTON—Wal-Mart Stores Inc. and Target Corp. have agreed to pay $232,000 to settle allegations that they overcharged Massachusetts municipalities for prescription drugs purchased under workers compensation insurance programs, the state's attorney general said.

To date, the Massachusetts attorney general's office has collected more than $8 million from retailers facing similar allegations. In 2010, for example, Attorney General Martha Coakley's office announced that CVS Pharmacy Inc. would settle similar allegations by paying $2.65 million to about 200 cities and towns.

Under terms of the settlements announced Tuesday, Wal-Mart will pay $207,000 to cities and towns while Target will pay $25,000.

The payments include double damages for violations of Massachusetts' False Claims Act and restitution. Agreement terms also require the retailers to establish procedures to guard against future overcharges.

“Cities and towns are under a great deal of economic pressure to provide much-needed services to their residents,” Ms. Coakley said in a statement. “We are proud of our work to get money back for cities and towns, and to prevent such overcharges from happening in the future.”