Justice Department sues Omnicare for rigging kickbacks with Abbott

Once again, long-term care pharmacy Omnicare is at the center of a Department of Justice kickback probe. This time, the drugmaker in focus is Abbott Laboratories ($ABT). The drug: Depakote.

The Justice Department sued Omnicare under the False Claims Act, claiming that the company asked for--and received--millions in kickbacks from Abbott over a 10-year period ending in 2008. The kickbacks were fillip for stocking up on Depakote and recommending the seizure drug for dementia patients in nursing homes Omnicare served, the suit claims.

Omnicare's pharmacists reviewed patients' charts at least once a month and made recommendations to staff physicians. According to the suit, Omnicare backed Depakote to help control dementia patients' behavior, and collected kickbacks from Abbott in return. The feds name Abbott in the suit, but not AbbVie ($ABBV), which was spun off--along with Depakote--from Abbott last year.

Some kickbacks were allegedly disguised as grants and funding for professional education, the feds say, with a program called Re*View as one major recipient. According to the lawsuit, Omnicare called Re*View its "one extra script per patient" program in private, and a "health management" program in public.

The kickbacks also took the form of rebates that rose according to the number of patients put on Depakote and the amounts prescribed per patient, the DOJ says in its statement. Then there were Abbott-funded management meetings for Omnicare on Amelia Island, Florida, and free tickets to sports events, the feds say.

"Elderly nursing home residents suffering from dementia are among our nation's most vulnerable patient populations, and they depend on the independent judgment of healthcare professionals for their daily care," Acting Assistant Attorney General Joyce Branda said in the statement. "Kickbacks to consulting pharmacists compromise their independence and undermine their role in protecting nursing home residents from the use of unnecessary drugs."

This isn't the first time Abbott and Depakote have been mentioned in a Justice Department press release. In 2012, the company pleaded guilty to a misdemeanor misbranding charge and agreed to $700 million in criminal penalties for promoting the drug for off-label uses. The company agreed to pay another $900 million or so in civil penalties to wrap up the Justice Department's investigation.

And Abbott isn't the first drugmaker to find itself involved in an Omnicare kickback suit. Last year, Amgen ($AMGN) agreed to pay $25 million to wrap up allegations that it paid kickbacks to induce long-term care pharmacies--including Omnicare--to use more of its Aranesp anemia drug.

Before that, the feds sued Omnicare over alleged kickbacks from Johnson & Johnson ($JNJ), designed to boost prescriptions of the antipsychotic drug Risperdal, and then sued J&J for the same reason. J&J settled that suit for $149 million as part of its $2.2 billion marketing settlement with the Justice Department.

And way back in 2009, a Teva Pharmaceutical Industries ($TEVA) subsidiary paid $14 million to settle claims that it shelled out $8 million to Omnicare to boost use of its drugs.

- read the Justice Department's release
- check out the government's complaint

Special Report: Pharma's Top 11 Marketing Settlements - Abbott Labs