(Reuters) -Omnicare, a subsidiary of health insurer CVS Health, said on Monday it has filed for bankruptcy to resolve issues related to its recent litigation in the U.S. District Court for the Southern District of New York. In July, a federal judge ordered Omnicare to pay $948.8 million in penalties and damages in a whistleblower […]
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CVS unit Omnicare files for bankruptcy to resolve litigation
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(Reuters) -Omnicare, a subsidiary of health insurer CVS Health, said on Monday it has filed for bankruptcy to resolve issues related to its recent litigation in the U.S. District Court for the Southern District of New York.
In July, a federal judge ordered Omnicare to pay $948.8 million in penalties and damages in a whistleblower lawsuit claiming it fraudulently billed the U.S. government for invalid drug prescriptions.
The lawsuit was filed in 2015 by Uri Bassan, a former Omnicare pharmacist in Albuquerque, New Mexico, and joined by the federal government in 2019.
They said Omnicare improperly billed Medicare, Medicaid, and Tricare, which serves military personnel, for prescriptions for tens of thousands of patients in assisted-living facilities, group homes for people with special needs, and other long-term care facilities.
“Given that ruling and a number of other issues facing our business, we now are taking necessary steps to move forward and ensure the continued delivery of safe and reliable pharmacy service to our customers.” said David Azzolina, President of Omnicare
CVS had said it would appeal the judgment. The Woonsocket, Rhode Island-based drugstore chain and pharmacy benefits manager bought Omnicare in 2015.
(Reporting by Christy Santhosh in Bengaluru; Editing by Shailesh Kuber and Krishna Chandra Eluri)