A tough retirement nest egg, the whistle-blowing way

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James M. Berklan, McKnight's Editor
James M. Berklan, McKnight's Editor

Two big reactions hit me when news of Johnson & Johnson's $2.2 billion Risperdal settlement with the government landed this week. First, J&J probably made a lot more than it's paying out and, second, some individual probably is going to cash a nice paycheck for bringing it all to light.

I'm right on at least the latter count. Whistle-blower Bernard Lisitza, a 74-year-old retired pharmacist from Illinois, helped the government make its case against J&J. Or vice versa. Whistle-blower suits begin with an individual filing against an entity and the government later joining in if it feels the case has legs.

Well, this one not only had legs, it galloped to an eye-popping finish. J&J settled the criminal and civil lawsuits against it by agreeing to a series of payments.

At issue was whether it improperly marketed — that is, oversold and over-promised — the antipsychotic Risperdal and other medicines.

Also, Omnicare, the top long-term care pharmacy provider in the United States, agreed in 2009 to pay $98 million to settle allegations that it solicited kickbacks in connection with this snake's nest.

That's where Lisitza came in. As a former Omnicare pharmacist and supervisor, he gave the feds an insider's view into what was happening. Without him, none of this probably ever comes to light, or at least not to the broad, public spotlight it's received.

For the record, Lisitza is credited with assisting in five big cases against pharma companies: two fraud cases against Omnicare, the J&J bonanza and cases against pharmacies CVS Caremark Co. and Walgreen Co.

It's probably safe to say even if he weren't of retirement age, not too many pharmacy companies would be giving his job application much of a sniff in the future.

Not that he needs to pack a brown bag and take the bus to a 9-to-5 the rest of his life. For his part in the J&J settlement, Lisitza will share in a $27.7 million pot of whistle-blower money. His take from all five cases combined comes to more than $31 million, according to a report in the Chicago Tribune citing court documents.

Lisitza was not commenting publicly after the J&J settlement, his lawyer said. He probably wants to savor a long-sought victory like this, especially after being under the hot glare of counter-accusations for so long. Whistle-blowers might get a hefty paycheck in the end, but they are usually put through hell before ever getting to go to the bank.

In 2001, Lisitza was fired after raising questions about some Omnicare practices, according to court documents. In 2007, he decided to go after the big guys, alleging J&J paid kickbacks to Omnicare for improperly substituting medications. By 2010 Massachusetts prosecutors had bought in to Lisitza's complaints and absorbed his lawsuit.

The end result: 2.2 billion reasons for Lisitza and authorities to feel vindicated. And probably a few million long-term care providers and other individuals keeping a closer eye on how key medicines are being prescribed, sold and delivered to seniors.

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Daily Editors' Notes

McKnight's Daily Editor's Notes features commentary on the latest in long-term care news. Entries are written by Editorial Director John O'Connor on Monday and Friday; Staff Writer Tim Mullaney on Tuesday, Editor James M. Berklan on Wednesday and Senior Editor Elizabeth Newman on Thursday.

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