Johnson & Johnson paid millions in kickbacks to Omnicare, False Claims suit alleges

The U.S. Department of Justice has filed a False Claims Act suit against Johnson & Johnson and two subsidiaries, arguing that they paid millions in kickbacks to nursing home pharmacy supply specialist Omnicare. The DoJ previously settled with Omnicare in November 2009, agreeing to a $98 million settlement that relieved Omnicare of civil liability under the False Claims Act for accepting J&J kickbacks.

In the current complaint, the DoJ asserts that J&J, along with subsidiaries Ortho-McNeil-Janssen Pharmaceuticals Inc. and Johnson & Johnson Health Care Systems Inc., paid kickbacks to Omnicare to induce the nursing home pharmacy firm to buy and recommend J&J drugs for use in nursing homes. These included anti-psychotic drug Risperdal.

The DoJ alleges that J&J knew Omnicare was reviewing nursing home patient charts at least every month, making recommendations as to which drugs patients should be prescribed. In fact, physicians were apparently accepting Omnicare recommendations more than 80 percent of the time, something J&J knew, the DoJ claims.

The government argues that to get Omnicare and its pharmacists to recommend J&J drugs, it provided kickbacks in a variety of ways, including paying larger rebates when Omnicare boosted use of J&J drugs; paying Omnicare millions for "data" which was largely not provided; and offering Omnicare "grants" and "educational funding," the true purpose of which was to induce Omnicare to recommend J&J drugs.

To learn more about the case:
- read this DoJ press release

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