Consumer Fraud

PharMerica whistleblower settlement totals $31.5 million

whistleblower 2 370x210 PharMerica whistleblower settlement totals $31.5 millionPharMerica Corporation has entered into a settlement agreement with the U.S. government to the tune of $31.5 million to resolve allegations contained in a whistleblower’s False Claims Act lawsuit that it overbilled the federal government for drugs it provided to nursing home patients and routinely dispensed oxycodone and other potent narcotics to individuals without valid prescriptions.

The U.S. Justice Department said that the company, based in Louisville, Ky., which provides pharmaceutical services to nursing homes and other senior care facilities, broke federal laws by submitting false claims to Medicare for narcotics that were improperly dispensed. PharMerica submitted false claims to Medicare Part D by improperly dispensing the Schedule II drugs.

According to the complaint, PharMerica allowed unqualified nursing home staff to order narcotics, and pharmacists to dispense them, without confirming that a physician had made a medical judgment as to whether the narcotics were necessary and should be administered to the patient.

“Pharmacies put patients at risk when they dispense Schedule II narcotics, which have the highest potential for abuse of any prescription drug, without a valid prescription from a physician,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer of the Department of Justice’s Civil Division.

“The legal requirement that narcotics like oxycodone be prescribed by a physician is a crucial patient protection, which is especially important to safeguard the health of the vulnerable elderly and disabled patients in long term care facilities,” said Lamont Pugh III, special agent in the Office of Inspector General, in a statement.

PharMerica entered into two separate settlement agreements with federal prosecutors. One settles the False Claims Act violations for $23.5 million and another pays the federal government $8 million in penalties for violating the Controlled Substances Act.

The whistleblower complaint was filed in Wisconsin federal court by Jennifer Buth, a PharMerica pharmacy operations manager in Pewaukee, Wis. She will receive $4.3 million of the total settlement as an award for her role in exposing the alleged fraud and misconduct.

Source: U.S. Department of Justice