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Billy Cunningham
Billy Cunningham
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Kickback Schemes or Legitimate Marketing?

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The Washington Post a few weeks ago reported that Johnson & Johnson paid tens of millions of dollars in kickbacks to boost sales of its drugs in nursing homes, including an antipsychotic that can be used as a chemical restraint. The Justice Department made these allegations in a lawsuit filed in Boston on January 15, 2010. Prosecutors claim that Johnson and Johnson illegally paid Omnicare, Inc., a pharmacy company that dispenses drugs in nursing homes, to buy its medicines and recommend their use to nursing homes. Under the plan, the governemnt claims Omincare’s purchases of Johnson & Johnson medicines nearly tripled to more than $280 million.

According to the complaint, the payments were sometimes disguised as grants or educational funding. It also claims that Johnson & Johnson used its influence with doctors to get prescriptions switched. Johnson & Johnson came to regard Omnicare pharmacists as an extension of its sales force, the government said, citing a company document.

Johnson & Johnson denies the allegations according to spokeswoman Carol Goodrich who said the company looks forward to presenting its evidence in court.

Hopefully, the scheme did not cause harm directly to residents. One of the drugs the government claims was oversold is a psychotropic drug that can be used as a chemical restraint.

Where money is taken away from resident care to increase profits, nursing home neglect or abuse occurs and injuries and deaths occur. In more and more, nursing home cases we are seeing related companies often owned by the same owners as of the nursing home, providing either pharmaceutical products, therapy services, management services, consulting services, operation services or lease arrangements which take money from the direct care of residents. It does not appear to be an issue in this lawsuit but the allegations cast even deeper suspicions on the owners and operators of nursing homes who are in it only for the money. As Tony West, assistant attorney general for the Justice Department’s Civil Division, said in a news release: "Kickbacks such as those alleged here distort the judgments of health care professionals and put profits ahead of sound medical treatment."

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  1. Mike Bryant says:
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    There is so much of this, whether it’s kickbacks or early payments, and pills based on paid for research. This is such a scary underbelly to a system that needs people to clean it up. But, it’s a lot easier to play politics and say no.