Jacksonville Pharmacies Settle False Claims Act Allegations for $7.4 Million

Two Jacksonville, Florida pharmacies and their owner will pay $7.4 million to settle allegations that they violated the federal False Claims Act and the Anti-Kickback Statute. The allegations involved the routine waiver of patient copayment obligations , and the inclusion of aripiprazole, an antipsychotic drug, in topical compounded pain creams solely to increase reimbursement from Medicare Part D and TRICARE.

Aripiprazole, known by brand names such as Abilify and Aristada, is intended to treat psychological conditions like schizophrenia and Tourette’s disorder. According to the complaint, defendants crushed aripiprazole pills intended for oral use and mixed the powder into custom-formulated pain creams sold to Medicare beneficiaries, despite a complete lack of any clinical basis for doing so.

In addition, the defendants allegedly waived patient copayments on a routine basis, in order to encourage patients to continue patronizing the pharmacies. Copayment waivers are allowed only under specific circumstances; routine or “blanket” waivers are considered illegal kickbacks.

The allegations were made in lawsuits filed by former pharmacy employees under the qui tam or whistleblower provisions of the False Claims Act. These provisions allow private individuals to sue on behalf of the government and share in the recovery if the case is successful. Here, the whistleblowers’ shares have not yet been determined.

Jason T. Brown, head of the whistleblower law firm Brown, LLC, stated, “This settlement sends a strong message that fraud that targets federal healthcare programs will not go unpunished.”