LOS ANGELES, CA, April 28, 2010 - Los Angeles law firms Girardi & Keese, and Wilkes & McHugh, P.A. have filed a class action lawsuit against Johnson & Johnson Corp and Omnicare Inc. for fixing the prices on a variety of drugs and then pushing them to nursing home residents.

Johnson & Johnson Corp manufactures pharmaceuticals, and Omnicare, Inc. is a dispensing and consulting pharmacy for about 1.4 million nursing home residents in the United States. Since 1997, the two companies have teamed up to promote the use of Johnson & Johnson drugs by nursing home residents.

Despite the fact that one of Omnicare's duties as a consulting pharmacy was to ensure the best medication for residents, the company used its position of power and influence to market Johnson & Johnson drugs. Omnicare pushed Floxin, Levaquin, Risperdal, Ultram, Duragesic, Procrit, and Propulsid to the elderly, according to the complaint, which was filed April 2, 2010, in the U.S. District Court for the Northern District of California.

The companies also conspired to create programs that violated Medicaid's best price law, which is intended to ensure that Medicaid pays the lowest price for drugs. They covered up the violations through a program of kickbacks and "service agreements" to increase revenue, and disguised the kickbacks as rebates and year-end bonuses.

While profits for both companies grew, nursing home residents were forced to pay millions of dollars extra for the Johnson & Johnson drugs. In some cases, residents had extra drugs administered unnecessarily and "were unlawfully switched to Johnson & Johnson drugs all as part and parcel of the conspiracy ... to increase revenue," according to the complaint.

"(Nursing home) residents are unique in our population when it comes to the use of pharmaceutical drugs. The residents are administered the greatest number of drugs, have the least ability to protest if the drugs are administered inappropriately and have the most consistent of payments sources: state and federal governments," the lawsuit states. "This 'perfect storm' of need, vulnerability and guaranteed payment are the environment in which the defendants created a scheme of kickbacks, illicit sales promotion, price fixing and avoidance of federal regulation."

There are two potential classes in the suit: One national and one consisting of only California residents. The national class could conceivably include all of the approximately 1.4 million nursing home residents in 47 states served by Omnicare.