There is one other reason to thank the federal government for going after the suspect payments Johnson & Johnson made to the middleman to juice up sales of its drugs: Since Medicaid covers most of the nursing home patients, the taxpayer ends up paying much of the bill.

The middleman between Johnson & Johnson and the nursing homes is Omnicare, the country’s largest pharmacy for nursing homes. Last November, it agreed, without “any finding of wrongdoing’’ or “any admission of liability,’’ to a $98 million settlement with the government for its role in helping Johnson & Johnson boost sales to nursing homes. The government says that between 1999 and 2004 Omnicare received tens of millions of dollars in the form of escalating rebates based on greater market share for Johnson & Johnson drugs and in payments ostensibly made by Johnson & Johnson for “data’’ from Omnicare, much of which Omnicare never provided. Other kickbacks, the government says, came in the form of “grants’’ and “educational funding.’’

Read entire article: http://www.boston.com/bostonglobe/editorial_opinion/oped/articles/2010/01/26/kickbackers_motto_do_no_harm_to_profits/