Drug Company Omnicare Fined for Paying Kickbacks

Omnicare, a large pharmaceutical dispensary that provides drugs to nursing homes, will have to pay $98 million in fines for soliciting and receiving kickbacks from the pharmaceutical company Johnson & Johnson, the parent company of Janssen Pharmaceutica, the maker of Risperdal.
In exchange for the kickbacks, Omnicare had to promote and encourage the use of Risperdal to its nursing home clients. It’s important to note that Risperdal comes with a specific warning about the use of Risperdal among the elderly population: ““Elderly patients with dementia-related psychosis treated with antipsychotic drugs are at an increased risk of death.”
Risperdal isn’t approved for patients with dementia and yet the drug has been widely used in the past in nursing home settings in spite of the warning label.
In agreeing to pay the $98 million fine (a drop in the bucket for any big pharma company), Omnicare admits nothing and walks away from the sordid episode with no finding of any wrongdoing, including any criminal liability for any elderly patients who may have died after using Risperdal.
This is a perfect example of what’s wrong with our healthcare system, particularly the pharmaceutical drug industry. When the federal government undertakes an investigation into the possible bad behavior of a pharmaceutical company, the drug company avoids any penalty that would curb the bad behavior in the future. By the time the fine is paid, the drug company has made such a substantial profit on the drug that any financial gain they’ve made outweighs the loss incurred by the penalty.
Until the federal government makes it cost prohibitive for drug companies to circumvent the law and public safety concerns, big pharma will continue to act in its own best interests ie. the profit margin.