Corporate Compliance

Nation's largest nursing home pharmacy to pay $98 million for kickback schemes

Compliance Monitor, November 11, 2009

The nation’s largest nursing home pharmacy, Omnicare Inc., will pay $98 million to resolve allegations that it violated the False Claims Act and participated in several kickback schemes, according to a Department of Justice (DOJ) press release. Drug manufacturer, IVAX Pharmaceuticals, will pay $14 million to resolve allegations that it engaged in kickback schemes with Omnicare.
 
According to the DOJ, Omnicare allegedly solicited and received kickbacks from drug manufacturer, Johnson & Johnson, in exchange for prescribing Risperdal, an antipsychotic drug, to nursing home patients. Johnson & Johnson allegedly disguised the kickbacks as data purchase fees, educational grants, and fees to attend Omnicare meetings. The DOJ reports that Omnicare also paid kickbacks to nursing homes in order to induce the homes to refer patients to Omnicare.
 
Omnicare also received $8 million in kickbacks from IVAX in exchange for purchasing $50 million in drugs from IVAX.
 
Approximately $68.5 million of the settlement will go to the United States and $43.5 million will cover Medicaid program claims by participating states.

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