A settlement reached to resolve False Claims Act Allegations against Omnicare Inc.
The allegations arose by a lawsuit claiming Omnicare Inc solicited and received kickbacks from pharmaceutical manufacturer Abbott Laboratories in exchange for promoting the prescription drug, Depakote, for nursing home patients.
On October 17, 2016, the Department of Justice announced, 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. Lastly, 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.
The United States, several states and Abbott entered into a $1.5 billion global civil and criminal resolution that, among other things, resolved Abbott’s liability under the False Claims Act for alleged kickbacks to nursing home pharmacies, including Omnicare and PharMerica Corp back in May 2012. PharMerica agreed to pay $9.25 million to the United States and several states to resolve civil liability under the False Claims Act for the alleged kickbacks from Abbott back in October 2015. This settlement will resolve Omnicare’s role in that alleged kickback scheme.
These allegations were brought forward by two former Abbott employees, Richard Spetter and Meredith McCoyd. As part of the Settlement, McCoyd will receive $3 million from the federal share of the settlement amount.
