U.S. Accuses J&J of Paying Kickbacks - TheStreet

WASHINGTON (

TheStreet

) -- The U.S. Justice Department filed a complaint against

Johnson & Johnson

(JNJ) - Get Report

and two of its subsidiaries for allegedly paying millions of dollars in kickbacks to the U.S.'s largest nursing home pharmacy,

Omnicare

(OCR)

.

Johnson & Johnson defended itself, saying in a statement that "we believe airing the facts will confirm that our conduct, including rebating programs like those the government now challenges, was lawful and appropriate. We look forward to the opportunity to present our evidence in court."

Omnicare entered into a $98 million settlement agreement in November that "resolved Omnicare's civil liability under the False Claims Act for taking kickbacks from J&J," the Justice Department said.

The government charges that J&J knew that physicians accepted the Omnicare pharmacists' recommendations more than 80% of the time and that J&J viewed such pharmacists as an "extension of

J&J's sales force."

According to the civil False Claims Act complaint, J&J understood that Omnicare's pharmacists reviewed nursing home patients' charts at least monthly and made recommendations to physicians on what drugs should be prescribed for those patients.

Recommend J&J drugs included the anti-psychotic drug Risperdal, for use in nursing homes.

The J&J subsidiaries named in the complaint are Ortho-McNeil-Janssen Pharmaceuticals and Johnson & Johnson Health Care Systems.

For more details about the government's suit, please click here for the

Department of Justice press release.

-- Reported by Andrea Tse in New York

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