The United States filed a qui tam or False Claims Act complaint against Johnson & Johnson (J&J) and its subsidiary companies Johnson & Johnson Health Care Systems Inc. and Ortho-McNeil-Janssen Pharmaceuticals Inc. According to the complaint, Omnicare Inc., the U.S.’s largest dispenser of pharmaceuticals to patients in nursing homes, was receiving millions of dollars in kickbacks from the companies. This complaint comes after Omnicare entered into a $98 million settlement with the federal government and multiple states in November of last year, an action that supposedly resolved Omnicare’s liability for taking previous kickbacks from Johnson & Johnson.
Allegedly, Omnicare accepted financial kickbacks in return for the company’s purchase and recommendation of Johnson & Johnson and its subsidiaries’ pharmaceutical products to nursing home patients. Doctors accepted the recommendations of Omnicare’s pharmacists more than 80 percent of the time, and allegedly Johnson & Johnson viewed Omnicare pharmacists as “an extension of its sales force.”
Kickbacks were delivered in several ways, including:
1) Offering Omnicare rebates when programs to increase the sale of Johnson & Johnson’s prescription drugs to nursing home patients were implemented.
2) Paying Omnicare millions of dollars for “data”; the complaint alleges that these payments were false and used only to coerce the recommendation of Johnson & Johnson drugs from Omnicare pharmacists.
3) Johnson & Johnson also made multiple “educational funding” and “grant” payments to Omnicare, with intent only to receive a recommendation from its pharmacists.
Assistant Attorney General for the Civil Division of the Department of Justice had this to say about the situation,
"We will pursue those who break the law to take advantage of the elderly and the poor. He went on to say that, “Kickbacks such as those alleged here distort the judgments of health care professionals and put profits ahead of sound medical treatment."