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Attorney General Jason R. Ravnsborg

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Nation’s Largest Nursing Home Pharmacy Company to Pay $23 Million to Settle Allegations Involving False Billings to State Medicaid Programs

FOR IMMEDIATE RELEASE:   Thursday, June 08, 2017    
CONTACT:  Sara Rabern (605) 773-3215

PIERRE, S.D. – Attorney General Marty Jackley announced today that South Dakota has joined with other states and the federal government to settle allegations of fraud against Omnicare Inc., the nation’s largest provider of pharmaceuticals and pharmacy services to nursing homes. Omnicare, headquartered in Cincinnati, Ohio, was acquired by CVS Health Corporation in August 2015. The total value of the settlement is $23,000,000. The total portion of the settlement amount recovered by South Dakota is $63,954.00, of which $42,869.10 will be retained by the federal government as the federal Medicaid share. The remaining $21,084.90 will go to the state general fund to offset alleged Medicaid damages in this case.

The settlement resolves allegations that Omnicare entered into contracts with drug company Organon USA Inc., and agreed to recommend the prescription of antidepressant drugs Remeron and Remeron Sol Tab in exchange for monetary payments disguised as rebates. The government resolved similar allegations against Organon in 2014.

The government alleges that Omnicare’s conduct violated the Federal False Claims Act and resulted in the submission of false claims to the South Dakota Medicaid program. Omnicare has previously entered into a Corporate Integrity Agreement (CIA) with the Department of Health and Human Services-Office of Inspector General (HHS-OIG). 

The South Dakota Medicaid Fraud Control Unit and the South Dakota Department of Social Services assisted in recovering the settlement money.