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Nursing Home Pharmacy Giant Settles Kickback Claims

November 4, 2009

Omnicare Inc., the self-described nation’s largest nursing home pharmacy, has agreed to pay $98 million to settle a variety of kickback scheme allegations made by the Government and a corporate whistleblower, says DoJ. Drug manufacturer IVAX Pharmaceuticals will pay $14 million to settle its alleged role in the kickback scheme. Nursing home chain Mariner Health Care, Inc. and SavaSeniorCare Administrative Services together with their principals Leonard Grunstein, Murray Forman, and Rubin Schron are alleged in a separate whistleblower suit intervened by DoJ for accepting kickbacks from Omnicare.

These defendants broke the law to take advantage of our nation’s most vulnerable citizens – the elderly and the poor.
— Tony West, Assistant Attorney General for the Civil Division of the Department of Justice.

According to the allegations, Omnicare solicited and recieved kickbacks from Johnson & Johnson in multiple forms, “including rebates that were conditioned on Omnicare engaging in an ‘Active Intervention Program’ for Risperdal and payments disguised as data purchase fees, educational grants, and fees to attend Omnicare meetings.” In turn, according to the allegations, Omnicare paid kickbacks “to nursing homes by providing consultant pharmacist services at rates below the company’s cost and below the fair market value of such services in order to induce the homes to refer their patients to Omnicare for pharmacy services.”

To report Antikickback violations and other Medicare fraud, contact Frohsin & Barger.

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