US files lawsuit against Johnson & Johnson over alleged kickback scheme

The US Department of Justice announced that it filed a lawsuit against Johnson & Johnson that alleges that the drugmaker paid millions of dollars in kickbacks to a pharmacy that specialises in dispensing drugs to nursing home patients. The US Attorney's office is seeking triple damages, restitution and other penalties under the federal False Claims Act and other laws.

The complaint alleges that Johnson & Johnson paid Omnicare to buy and recommend the company’s drugs, including the anti-psychotic Risperdal (risperidone), for use in nursing homes between 1999 and 2004. The DOJ claims that the drugmaker “knew that physicians accepted the Omnicare pharmacists’ recommendations more than 80 percent of the time,” and that the company saw the pharmacists as an "extension of [J&J’s] sales force."

Prosecutors said that Johnson & Johnson entered agreements with Omnicare that gave the company increased rebates if it increased prescriptions of the drugmaker’s products. The alleged kickbacks also included payments for the pharmacy’s data, much of which Omnicare never provided, as well as for education programmes. In November, Omnicare agreed to pay $98 million under a settlement deal related to the alleged scheme.

In response, Johnson & Johnson said that the company believes that “airing the facts will confirm that our conduct, including rebating programmes like those the government now challenges, was lawful and appropriate."

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