Omnicare and parent company CVS Health earned a court victory this week after a federal appeals court agreed to dismiss a whistleblower’s False Claims Act lawsuit for an alleged kickback scheme.
The ruling was handed down Monday by the U.S. Court of Appeals for the Seventh Circuit, Bloomberg Law reported. The Department of Justice, which sought the dismissal, had argued that the case was meritless, didn’t violate federal healthcare policies and would drain federal resources.
There’s been an uptick in FCA dismissals sought by the DOJ since it’s Granston memo in Jan. 2018. The DOJ directs prosecutors to seek dismissal of whistleblower cases “that lack merit on its face, wastes government resources, or undermines federal policies should be targeted for dismissal,” the report explained.
Judge David F. Hamilton of the U.S. Court of Appeals for the Seventh Circuit wrote that the government’s move to dismiss “shocks no one’s conscience.”
“We are pleased that the court agreed with the government’s decision to dismiss this case related to [RXCrossroads] a former subsidiary of Omnicare, which we divested in 2018. We remain committed to complying with all laws applicable to our business,” CVS Health said in a statement to McKnight’s Long-Term Care News.
A request by McKnight’s to the DOJ for comment was not returned by production deadline.
The whistleblower suit had alleged that CVS Health, Omnicare, RXCrossroads and pharmaceutical company UCB, Inc. offered free nursing and reimbursement support services in order to get doctors to recommend the Crohn’s disease drug Cimzia to patients, according to the news agency.
The suit had also alleged the provider companies’ submitted Medicare and Medicaid claims were tainted by the kickbacks.