Omnicare to pay $28 million for kickback scheme

October 21, 2016

Omnicare agreed to settle claims that it conspired with Abbott Laboratories “to engage in a number of disguised kickback arrangements to increase overall use of Depakote,”

CVS Health-owned Omnicare, the largest institutional pharmacy in the United States, will pay several states and the federal government $28.125 million to resolve allegations that it received kickbacks for Depakote.

Maura HealeyAs part of the federal agreement, Omnicare will pay the Massachusetts Medicaid Program (MassHealth) more than $475,000 and Ohio more than $670,000. In total, 47 states and the District of Columbia will receive payments.

Omnicare agreed to settle claims that it conspired with Abbott Laboratories “to engage in a number of disguised kickback arrangements to increase overall use of Depakote,” Massachusetts Attorney General Maura Healey said in a statement. Depakote is an anticonvulsant drug used to treat epilepsy and bipolar disorder and to help prevent migraine headaches. CVS Health said the alleged offenses happened before it acquired Omnicare, and that it settled the case to avoid extended litigation.  

“Omnicare’s illegal kickbacks came at the expense of seniors and vulnerable patients,” Healey said.

The settlement originates from cases filed in Virginia by whistleblowers in Georgia and California.

Omnicare, acquired by CVS Health in August, 2015, for $12.9 billion, provides pharmaceuticals and related pharmacy services to elder care facilities and in other specialized healthcare settings.

The states participating in the settlement contend that, between January 2001 and December 2008, Omnicare knowingly solicited and received illegal payments from Abbott through agreements that required Omnicare to engage in certain promotional programs, grants, and other financial support. “This alleged conduct resulted in false claims to Medicaid and other federally-funded health care programs,” according to the Massachusetts Attorney General’s office.

 

Omnicare will pay the states and the federal government to compensate Medicaid, Medicare, and other federal healthcare programs for harm suffered.

The team appointed by the National Association of Medicaid Fraud Control Units to investigate the case included representatives from the Offices of the Attorneys General for the states of California, Illinois, Maryland, New York, Ohio, South Carolina and Virginia.