A South Jersey whistleblower won a $100 million False Claims Act settlement against PharMerica
The $100 million settlement resolved a lawsuit that was filed in 2011.
The former owner of a Cherry Hill nursing home won a $100 million whistleblower settlement against PharMerica Corp., a pharmacy that serves nursing homes and other long-term care institutions, the plaintiff’s Philadelphia law firm Berger Montague PC announced Wednesday.
In a lawsuit originally filed in 2011, Marc Silver — who owned Silver Care Center — alleged that PharMerica violated the Anti-Kickback Statute and False Claims Act by underpricing some drugs Medicare paid for in order to secure other Medicare- and Medicaid-funded drug business that was much more lucrative.
“The size of the settlement speaks to the tremendous work we did, and the risk that PharMerica faced at trial if we had presented the evidence we had amassed showing that PharMerica had reaped huge profits for years by using illegal kickbacks to win contracts,” said Silver’s lawyer, Sherrie R. Savett.
The lawsuit specifically accused PharMerica of giving nursing homes a financial break on drugs that they had to pay for under Medicare Part A, in exchange for the right to supply drugs to the same nursing homes under the larger Medicare Part D and Medicaid programs. The two latter programs were more profitable for PharMerica, according to Berger Montague.
The lawsuit in U.S. District Court for the District of New Jersey took a winding road to settlement. A District Court judge dismissed the case in 2016, but two years later, the Third Circuit Court of Appeals in Philadelphia reinstated the case. PharMerica agreed to settle the case in November 2023 without admitting liability, according to a Securities and Exchange Commission filing from PharMerica’s parent, BrightSpring Health Services Inc.
A judge approved the settlement on July 3.
The company, based in Louisville, Ky., said it was pleased to put this matter from many years ago behind it.
“At PharMerica, we comply with federal and state regulations, evaluating our policies and procedures on an ongoing basis to ensure we always operate in the best interests of the customers and patients we serve,” the company said.
Berger Montague said the settlement will return $70 million to federal and state governments, even though the U.S. Department of Justice did not take up Silver’s case. The law firm did not specify how much Silver would get for his role as a whistleblower.