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Omnicare Settles Fraudulent Kickback Scheme

Many individuals do not know that the prescription drug industry is among the worst corporate offenders in the nation and that over $68 billion dollars is stolen every year through health care scams. One of the largest pharmaceutical distributors is Omnicare Inc. The company disburses their drugs to nursing homes and has agreed to pay a lump sum of $98 million to the government to resolute accusations that “they were involved in a fraudulent kickback scheme” that included many nursing homes as well as drug companies. “Omnicare allegedly ‘solicited and received’ kickbacks from healthcare giant Johnson & Johnson in exchange for ‘agreeing to recommend that physicians prescribe’ the company’s anti-psychotic drug, Risperdal.” The payments made to Johnson & Johnson were concealed and input as informational fees, educational grants, and attendance fees for various meetings in regards to Omnicare’s products. Recent reports released by the government stated that Omnicare also received $8 million in kickbacks for solicitation from IVAX, yet another drug producing company in exchange for a settlement agreement that involved Omnicare’s purchase of $50 million worth of drugs from IVAX.

According to the Justice of Peace, the actions set forth by Omnicare, along with Johnson & Johnson companies and IVAX, have resulted in many “false claims to be submitted to Medicare, Medicaid, and other federal healthcare programs”. The Defendants in the case have taken advantage of many elderly and poor individuals, who are among the nation’s most vulnerable citizens. Assistant Attorney General Tony West stated that, “Illegal conduct like this can undermine the medical judgments of healthcare professionals, lead to patients being prescribed medications they do not need, and drive up the cost of healthcare”. The case was filed and reported to the government due to five individuals who filed lawsuits alleging that the company was involved in false claims activity. The Justice Department is negotiating as to whether the need to get involved with the lawsuit filed against Johnson & Johnson is mandatory on their part; but as far as the lawsuit filed against IVAX goes, the Department ruled that IVAX will pay fees of $14 million to settle all accusations on their part in this scheme.

Source: The Associated Press, CBS Evening News, and Wall Street Journal

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