Omnicare, the country’s largest nursing home pharmacy, last week said it will pay just over $28 million to settle allegations that it received kickbacks from Abbott Laboratories in exchange for promoting an anti-seizure drug to its nursing home patients.
[The complaint, originally filed in 2014 by the Department of Justice, can be viewed here.]
Abbott’s liability had been resolved by a previous resolution in 2012.
The Department of Justice outlines the allegations against Omnicare:
According to the government’s complaint, Omnicare disguised the kickbacks it received from Abbott in a variety of ways. Abbott allegedly made payments to Omnicare described as “grants” and “educational funding,” even though their true purpose was to induce Omnicare to recommend Depakote.
For example, Omnicare allegedly solicited substantial contributions from Abbott and other pharmaceutical manufacturers to its “Re*View” program. Although Omnicare claimed that Re*View was a “health management” and “educational” program, the complaint alleges that it was simply a means by which Omnicare solicited kickbacks from pharmaceutical manufacturers in exchange for increasing the utilization of their drugs on elderly nursing home residents. In internal documents, Omnicare allegedly referred to Re*View as its “one extra script per patient” program.
The complaint also alleges that Omnicare entered into agreements with Abbott by which Omnicare was entitled to increasing levels of rebates from Abbott based on the number of nursing home residents serviced and the amount of Depakote prescribed per resident.
Finally, the complaint alleges that Abbott funded Omnicare management meetings on Amelia Island, Florida, offered tickets to sporting events to Omnicare management and made other payments to local Omnicare pharmacies.
Reuters has details on how the settlement money will be allocated:
The Justice Department said $20.3 million of its settlement with Omnicare will be paid in restitution to U.S. government health insurance programs, while the remaining $7.8 million will be allocated to cover Medicaid program claims by states.
The settlements with Omnicare, Abbott Labs and PharMerica will resolve allegations in two lawsuits filed by former Abbott Lab employees who blew the whistle on the kickbacks.
One of those whistleblowers, Meredith McCoyd, will receive a $3 million payout for her role in helping uncover the scheme, the Justice Department said.
