Johnson & Johnson paid kickbacks to Omnicare, government alleges in lawsuit

TRENTON, N.J. — Federal prosecutors said Friday that health care giant Johnson & Johnson paid tens of millions of dollars in kickbacks so nursing homes would put more patients on its blockbuster schizophrenia medicine and other drugs.

In a complaint filed Friday, prosecutors said J&J paid rebates and other forms of kickbacks to Omnicare Inc., the country's biggest dispenser of prescription drugs in nursing homes. Prosecutors allege Omnicare pharmacists then recommended that nursing home patients with signs of Alzheimer's disease be put on the powerful schizophrenia drug Risperdal, which was later found to increase risk of death in the elderly.

The allegations are in a complaint filed by the U.S. attorney in Boston, whose office has joined two whistle-blower cases. One was filed in 2003 by a former Omnicare pharmacist in Chicago, Bernard Lisitza, who alleges he was fired after he challenged the Risperdal kickbacks and other improper practices at the company. The other was filed by former Omnicare financial analyst David Kammerer in 2005, after he resigned from the company.

"Kickbacks in the nursing home pharmacy context are particularly nefarious because they can result in excessive prescribing of strong drugs to patients who have little or no control over the medical care they are receiving," U.S. Attorney Carmen Ortiz said in a statement.

Johnson & Johnson, based in New Brunswick, N.J., said in a statement it is reviewing the complaint and "will address the government's lawsuit in court.''

''We believe airing the facts will confirm that our conduct, including rebating programs like those the government now challenges, was lawful and appropriate. We look forward to the opportunity to present our evidence in court."

Ortiz's office is seeking triple damages, restitution and other penalties under the federal False Claims Act and other laws. The damages would be based on the amount of false claims charged to Medicaid, which paid for about two-thirds of the claims Omnicare submitted for J&J drugs — possibly hundreds of millions of dollars.

The government's complaint alleges the scheme went on from 1999 through 2004, a period when J&J's sales of drugs through Omnicare jumped from about $100 million to more than $280 million.

Johnson & Johnson paid kickbacks to Omnicare, government alleges in lawsuit 01/15/10 [Last modified: Friday, January 15, 2010 10:53pm]

Copyright: For copyright information, please check with the distributor of this item, Associated Press.

Join the discussion: Click to view comments, add yours

Loading...