KICKBACKS
Johnson & Johnson and its subsidiaries paid millions of dollars in kickbacks to the nation’s largest pharmacy that specializes in dispensing drugs to nursing home patients, the federal government alleged in a civil complaint filed today.
Does the government have a case? Well, according to a settlement with the pharmacy involved...
In November 2009, the United States, numerous states and Omnicare entered into a $98-million settlement that, among other things, resolved Omnicare’s civil liability for taking kickbacks from Johnson & Johnson, the government said.
The suit, filed in Boston, alleges Johnson & Johnson of New Brunswick, N.J., and two of its subsidiaries paid money to Omnicare "to induce the nursing home pharmacy company to purchase and recommend J&J drugs, including the anti-psychotic drug Risperdal."
The payments, between 1999 and 2004, took various forms, including funds for data that were never provided, escalating rebates for taking Johnson & Johnson products and money for education programs for customers, the Department of Justice said.
Omnicare charged Medicaid for a substantial portion, according to the government.
80% of Omnicare's reccomendations were followed by doctors. So, someone's Johnson & Johnson shareprices are getting between nursing home patients and their doctors.
To incorporate Wall Street logic here, those bribes, kickbacks get passed along to you the consumer and taxpayer.