(Updates with comment from Omnicare.)
By Brent Kendall
Of DOW JONES NEWSWIRES
WASHINGTON -(Dow Jones)- Geriatric pharmacy company Omnicare Inc. (OCR) will pay $98 million to settle charges that it engaged in several kickback schemes with drug makers and nursing homes, the U.S. Justice Department announced Tuesday.
The department also said IVAX Pharmaceuticals, a unit of Teva Pharmaceutical Industries Ltd. (TEVA), will pay $14 million to settle allegations that it paid $8 million in kickbacks in exchange for Omnicare's agreement to buy $50 million worth of IVAX drugs.
The Justice Department alleged that Omnicare regularly paid kickbacks to nursing homes in order to induce the homes to refer their patients to Omnicare for pharmacy services.
Department lawyers also said Omnicare solicited and received kickbacks from Johnson & Johnson (JNJ) in exchange for agreeing to recommend that doctors prescribe J&J antipsychotic drug Risperdal.
A Justice Department spokesman had no immediate comment on Johnson & Johnson's current legal status in the government's case. Omnicare said in a statement that it disputes the government's allegations and said the settlement does not include any finding of wrongdoing or any admission of liability by the company.
"The company agreed to settle the matters in order to avoid expensive and time-consuming litigation and to focus on its mission of providing high-quality pharmaceutical care for the frail elderly," Omnicare said.
Representatives for Teva and Johnson & Johnson did not immediately respond to requests for comment.
Separately, the department said it was intervening in a lawsuit alleging that two nursing-home chains, Mariner Health Care Inc. and SavaSeniorCare Administrative Services, accepted kickbacks from Omnicare in return for pharmacy-service contracts.
-By Brent Kendall, Dow Jones Newswires; 202-862-9222; brent.kendall@dowjones.com