Omnicare will pay $124 million in a settlement to resolve allegations of falsely billing Medicare and state Medicaid programs. The company is accused of submitting false claims and entering below-cost contracts with nursing homes to encourage the facilities to choose Omnicare as their preferred pharmacy provider. Omnicare did not admit to wrongdoing and agreed to the settlement to avoid prolonged legal proceedings, said a company spokesman.
Companies' legal departments are taking on more work, while their resources remain the same, according to a survey by AlixPartners. Among respondents, 36% say the number of cases has increased, and 83% report higher litigation costs. However, 64% say the size of their legal department has stayed the same.
The Federal Trade Commission filed a lawsuit to block Omnicare's proposed $440.8 million acquisition of PharMerica. A merger of the drug suppliers would "diminish competition and raise health care costs, leaving taxpayers and patients to foot the bill," said Richard Feinstein, head of the FTC's Bureau of Competition.