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Omnicare, Inc. to Settle False Claims Act Allegations

June 30, 2014

Thanks to a False Claims Act case filed by Donald Gale, a former Omnicare employee, the nation’s largest provider of pharmaceuticals and pharmacy services to nursing homes has agreed to pay $124.24 million to resolve allegations that the company offered improper kickbacks to skilled nursing facilities, according to a DoJ press release.  Mr. Gale alleges that Omnicare entered into below-cost contracts to supply prescription medication and other drugs to skilled nursing facilities in order to induce the facilities to select Omnicare as their pharmacy provider.

“Omicare provided improper discounts in return for the opportunity to provide medication to Medicare and Medicaid beneficiaries,” said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.  “Nursing homes should select their pharmacy provider based on the best quality, service and cost to the residents, not based on improper discounts to the nursing facility.”

Mr. Gale will receive $17.24 million as the first whistleblower under the qui tam provisions of the False Claims Act, which allows private parties to bring suit on behalf of the government and to share in any recovery.

To report Medicare fraud, please contact Frohsin & Barger.

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