Omnicare, Inc. has agreed to pay $4.19 million to settle allegations by a whistleblower in a qui tam lawsuit that it solicited and received illegal kickbacks in violation of the False Claims Act. Omnicare, based in Ohio, is one of the nation’s largest providers of pharmaceuticals to long-term care facilities and nursing homes.
According to the Justice Department, Omnicare solicited and received illegal kickbacks from drug manufacturer Amgen, Inc. based in California. The government claims that Omnicare received kickbacks in the form of performance-based rebates tied to volume threshold, grants, speaker fees, consulting service fees, data fees, payment for dinners, and paid travel in return for switching Medicaid recipients to Amgen’s drug Aranesp from a competitor’s drug.
In 2011, a former Amgen employee, Frank Kurnik, filed the whistleblower lawsuit under the qui tam provisions of the False Claims Act. According to the whistleblower, Amgen allegedly induced medical providers to switch government healthcare beneficiaries to Amgen’s anemia drug Aranesp by paying kickbacks in violation of the False Claims Act.
Of the $4.19 million to be paid by Omnicare in settlement of the False Claims Act allegations, the whistleblower will receive $397,925 as his reward under the qui tam provisions of the False Claims Act. The case remains pending against other pharmacy providers PharMerica and Kindred. Amgen paid approximately $24 million in 2013 to settle the allegations against it related to the whistleblower’s lawsuit.
Omnicare paid $120 million to settle an unrelated qui tam lawsuit in 2013. In that case, the whistleblower alleged that Omnicare charged below fair market value prices for Medicare Part A inpatients in exchange for long-term care facilities’ referrals of non-Part A patients at much higher prices.
The False Claims Act allows individuals, called relators, to file lawsuits on the government’s behalf against people or entities who have committed fraud against the government. The False Claims Act allow for the recovery of three times the amount of damages. In addition, in most circumstances, the whistleblower is entitled to receive a percentage of any award or settlement amount as a reward.
If you have personal knowledge that someone is committing fraud on the government, click here to see if you have a case.