Simmer Law Group Announces $28.125 Million Settlement in Kickback Case Against Institutional Pharmacy Omnicare

WASHINGTON, Oct. 17, 2016 /PRNewswire/ -- The Simmer Law Group announced today that a False Claims Act (FCA) lawsuit it filed for a whistleblower client on behalf of the United States and participating Medicaid states against Cincinnati-based Omnicare has settled for $28.125 million. The United States Department of Justice (DOJ) intervened in the suit in 2014. DOJ announced today that it had reached a settlement with Omnicare to resolve allegations that it solicited and received kickbacks from pharmaceutical manufacturer Abbott Laboratories in exchange for promoting the prescription drug, Depakote, for nursing home patients. Now a wholly-owned subsidiary of CVS Health Corporation, Omnicare is the nation's largest institutional pharmacy with a 75 percent market share, filling over 100 million prescriptions annually.

According to Scott Simmer of the Simmer Law Group, who represented the first-filed relator in the case against Omnicare, today's settlement is related to the fraud to which Abbott pleaded guilty in May of 2012 when it agreed to pay $1.5 billion to resolve its criminal and civil liability arising from the unlawful promotion of the drug Depakote, including to elderly patients with dementia. Omnicare's main competitor, PharMerica, paid $9.25 million last year to resolve similar allegations.

Simmer says long-term care facilities typically contract with institutional pharmacies like Omnicare to provide not only special packaging for controlled administration, but also consultation services for physicians and in-service training programs for nursing staff. The company receives millions of dollars annually in reimbursement from the federal Medicare Part D program as well as from Medicaid, which is jointly funded by the federal and state governments.

"Federal and state anti-kickback statutes prohibit the exchange of anything of value in an effort to induce the referral of federal health care program business," Simmer said. "Violators on either end of the transaction risk not only civil and criminal penalties, but also possible exclusion from government health insurance programs."

"The most appalling thing about this case was that it violated the trust of some of the most vulnerable Americans – the elderly," Simmer said. "We hope this sends a powerful signal to those who care for our seniors. Families trust that the staff caring for their loved one put the elderly resident's interests first. We are grateful for the extraordinary work of Assistant Director Ed Crooke and Trial Attorney Brian McCabe in the Commercial Litigation Branch, Civil Division, United States Department of Justice; Rick Mountcastle, First Assistant United States Attorney in the U. S. Attorney's Office for the Western District of Virginia; and Wm. Clay Garrett, Assistant Attorney General and Chief of Civil Litigation for the Medicaid Fraud Control Unit in the Virginia Attorney General's Office."

About Simmer Law Group PLLC
Based in Washington, DC, the Simmer Law Group PLLC represents whistleblowers nationwide who have filed cases alleging fraud that financially impacted state and federal governments in the areas of health care, for-profit education and government contracting; as well as insurance plans in large scale recovery actions.

Related Documents

Relator's Second Amended Complaint

SOURCE The Simmer Law Group