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Drug provider Omnicare settles suit over alleged kickbacks for $4.2M


Long-term care pharmacy firm Omnicare Inc. has agreed to pay the government $4.2 million to settle charges in a whistle-blower suit that it engaged in a kickback scheme with a drug manufacturer in violation of the False Claims Act, the U.S. Department of Justice said Thursday.

Cincinnati-based Omnicare was accused of soliciting and receiving kickbacks from Thousand Oaks, Calif.-based Amgen Inc. in return for implementing “therapeutic interchange” programs designed to switch Medicaid beneficiaries from a competitor drug to Amgen's product, Aranesp.

The government alleged that the kickbacks were in the form of performance-based rebates that were tied to market share or volume thresholds as well as grants, speaker fees, consulting services, data fees, dinners and travel, said the Justice Department.

Law firm Grand & Eisenhofer P.A. identified the whistle-blower in the case as its client, Frank Kurnik, who it said is a long-time Amgen employee. He will receive $397,925, the department said.

“Kickbacks are designed to influence decisions by health care providers, such as which drugs to prescribe,” said Stuart F. Delery, assistant attorney general for the Justice Department's civil division, in a statement. “Americans who rely on federal health care programs, particularly vulnerable patients in skilled nursing facilities, are entitled to feel confident that decisions about their medical care are not tainted by improper financial arrangements.”

“The company agreed to settle the matter in order to avoid continued litigation and to focus on its mission of helping to ensure the health of seniors and other patient populations in a cost-effective manner,” Omnicare said in a statement. “The settlement is not an admission of liability, and Omnicare continues to deny that there was any wrongdoing. Omnicare is committed to ensuring that it remains in strict compliance with all applicable laws, regulations and standards in each of the markets and jurisdictions in which it operates.”


Last year, in one of the largest health care fraud settlements in U.S. history, New Brunswick, N.J.-based Johnson & Johnson agreed to pay $2.2 billion to end civil and criminal investigations into kickbacks to pharmacists and the marketing of pharmaceuticals for off-label uses. The company was accused of paying millions of dollars in kickbacks to Omnicare.

In addition, Amgen last year agreed to pay $24.9 million to resolve charges under the False Claims Act that it was involved in a kickback scheme with long-term pharmacy providers, including Omnicare.