Johnson & Johnson Accused of Defrauding Nursing Home Patients
By Jim Greene
Published on May 19, 2010
Drug giant Johnson & Johnson is accused of conspiring with pharmaceutical consulting and supply company Omnicare, Inc., to defraud nursing home residents across the country in a class-action lawsuit filed recently in a Los Angeles federal court. According to the suit, the drug maker paid kickbacks to Omnicare and fixed prices to get J&J products prescribed to nursing home patients, often unnecessarily.
As a pharmaceutical consultant and supplier, Omnicare is hired by nursing homes in 47 states and Canada to find and provide medications at the best possible price. Meeting that goal is also a requirement of federal Medicaid law.
According to the lawsuit, J&J and Omnicare representatives met quarterly to discuss progress toward the goal of displacing medications from other companies with those from J&J, to keep prices as high as possible, and to convince doctors to order unnecessary prescriptions. In exchange, J&J paid Omnicare kickbacks thinly disguised as performance rebates and year-end bonuses.
The details of the two companies' plan were contained in a 1997 agreement that attempted to make the procedures appear legitimate, according to the lawsuit. Medications alleged to be targeted for promotion included Floxin®, Levaquin®, Risperdal®, Ultram®, Duragesic®, Procrit®, and Aciphex®.
In order to help promote the J&J drugs to doctors and patients, Omnicare, in its capacity as pharmaceutical consultant, would give the J&J products a preferred ranking, implying that they were somehow superior to similar drugs from other companies, according to the lawsuit.
The two companies allegedly conspired to keep prices as high as possible. If prices approached a level that would arouse the suspicion of Medicaid, according to the suit, they were adjusted downward.
A decision will be made in court to determine if the class represented in the lawsuit will include only California nursing home patients or those in all 47 states in which Omnicare does business, potentially as many as 1.4 million people.
If you or a loved one had been the victim of the Johnson & Johnson/Omnicare scheme to defraud nursing home residents, contact an experienced attorney. The decision on who to include in the plaintiff class, as well as other pretrial proceedings, will affect how you may be able to recover your financial losses. Your attorney will be able to explain the details and help you plan your legal action.
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