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Omnicare pays $49.5 million to settle Medicaid fraud

Pharma Compliance Alert, November 22, 2006

Omnicare, the nation's largest provider of pharmacy services to long-term care facilities, will pay $49.5 million to the federal government and 42 states settle Medicaid fraud charges initiated by whistleblowers, the company announced November 14.

The government accused the Covington, KY-based company of filling prescriptions with more expensive alternatives just to earn higher reimbursement for three generic drugs - capsules instead of tablets of Ranitidine (a generic form of Zanact), tablets instead of capsules of Fluoxetine (a generic form of Prozac), and two 7.5 mg tablets for one 15 mg tablet of Buspirone (a generic form of Buspar).

As part of the settlement, Omnicare entered a corporate integrity agreement with the HHS OIG. The CIA requires the company to establish a code of conduct, policies and training programs and to conduct audits and submit reports to OIG on its compliance activities.

The CIA also states that Omnicare's compliance officer must not be subordinate to either the chief counsel or chief financial officer and must submit quarterly reports directly to the audit committee and the company's board of directors.

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