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Friday, January 28, 2022
7 hours ago — The former executive of a South Florida pharmacy, Matthew Smith, ... programs for medically unnecessary compound drugs from a pharmacy in Broward, Fla., ...
9 hours ago — A South Florida pharmacy executive pleaded guilty to his role in an $88 ... medically unnecessary compound drugs from a Broward pharmacy, the DOJ said.
Wednesday, January 26, 2022
Former South Florida Pharmacy Executive Pleads Guilty to $88 Million Health Care Fraud Conspiracy Targeting Military Health Care Programs
Department of Justice
U.S. Attorney’s Office
Southern District of Florida
FOR IMMEDIATE RELEASE
Wednesday, January 26, 2022
Former South Florida Pharmacy Executive Pleads Guilty to $88 Million Health Care Fraud Conspiracy Targeting Military Health Care Programs
Miami, Florida – A Palm Beach County, Florida man has pleaded guilty to his role in a multi-million-dollar conspiracy to defraud Tricare and CHAMPVA through a South Florida compounding pharmacy fraud scheme.
As part of his guilty plea, 58-year-old Matthew Smith admitted his role in fraudulently billing Tricare and CHAMPVA for expensive, medically unnecessary compound drugs from a Broward pharmacy. Tricare and CHAMPVA are the health care benefit programs for the United States Department of Defense and Department of Veterans Affairs. In furtherance of the scheme, Smith—then executive vice-president of the pharmacy—and his co-conspirators paid approximately $40 million in kickbacks to patients, patient recruiters and doctors in exchange for their ordering expensive pain creams, scar creams and vitamins without regard to the beneficiaries’ actual medical needs. The drugs were formulated to maximize profit without legitimate therapeutic value. The reimbursement rates sometimes reached $15,000 for a one-month supply. In addition, the pharmacy did not charge beneficiaries the mandatory copayments, something that the co-conspirators concealed. The fraudulent billings caused a loss to the programs of approximately $88 million.
Smith pled guilty to one count of conspiring to commit health care fraud. Sentencing is scheduled for April 5, at 3:00 p.m., in Miami, before U.S. District Judge Roy K. Altman. Smith faces up to 10 years in federal prison.
U.S. Attorney Juan Antonio Gonzalez of the Southern District of Florida; Special Agent in Charge Cynthia A. Bruce, Department of Defense Inspector General’s Defense Criminal Investigative Service (DCIS), Southeast Field Office; Special Agent in Charge David Spilker, Veterans Affairs, Office of Inspector General (VA-OIG), Southeast Field Office; Special Agent in Charge George L. Piro of the FBI Miami; and Special Agent in Charge Justin C. Fielder, FDA Office of Criminal Investigations’ Miami Field Office, made the announcement.
“Fraudsters steal exorbitant amounts of money from our government health programs through prescription medication fraud schemes,” said U.S. Attorney Gonzalez. “Those who use kickback payments and fraudulent billing activities to defraud vital public programs will be held accountable.”
“Compounding pharmacy fraud bilked the Defense Health Agency of over a billion dollars and exploited not only the military, but all citizens,” said DCIS Special Agent in Charge Bruce. “I thank the U.S. Attorney’s Office and our investigative team for their tireless effort to untangle this web of crime, trace the assets, and hold these individuals accountable.”
“The defendant pleaded guilty for his abhorrent conduct in defrauding multiple federal healthcare programs meant to benefit deserving veterans and their families,” said Special Agent in Charge David Spilker of the Department of Veterans Affairs Office of Inspector General’s Southeast Field Office. “The VA OIG is committed to continuing its work with our law enforcement partners to ensure the integrity of VA’s healthcare and benefit programs.”
“Illegal kickbacks undermined the integrity of the Tricare health benefit program by putting profits in front of patient welfare,” said George L. Piro, Special Agent in Charge, FBI Miami. “The investigators who unraveled this scam are to be commended for their diligence and commitment. The FBI and our partners will continue to pursue those individuals who pay kickbacks and fraudulently bill for medical services that are not necessary.”
“Criminals whose schemes cause medically unnecessary prescription drugs to be sent to consumers could put the public health at risk,” said Special Agent in Charge Justin C. Fielder, FDA Office of Criminal Investigations’ Miami Field Office. “We will continue to pursue and bring to justice those who place profits above public health.”
The DCIS, VA-OIG, FBI, and the FDA, investigated the case.
Assistant U.S. Attorney Jon Juenger prosecuted the case. Assistant U.S. Attorney Daren Grove is handling the asset forfeiture component of the case.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov.
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Topic(s):
Health Care Fraud
Component(s):
Contact:
Marlene Rodriguez
Special Counsel to the U.S. Attorney
Public Affairs Officer
USAFLS.News@usdoj.gov
Updated January 26, 20
| Posted Date | Letter Issue Date | Company Name | Issuing Office | Subject | Response Letter |
|---|---|---|---|---|---|
| Go Vapor LLC | Center for Tobacco Products | Family Smoking Prevention and Tobacco Control Act/Adulterated/Misbranded | |||
| D & J Vapors, LLC-Horse Cave | Center for Tobacco Products | Family Smoking Prevention and Tobacco Control Act/Adulterated/Misbranded | |||
| Aurobindo Pharmaceutical Limited | Center for Drug Evaluation and Research | CDER | CGMP/Active Pharmaceutical Ingredient (API)/Adulterated | |||
| SAS Technologies, Inc d/b/a Save A Smoker | Center for Tobacco Products | Family Smoking Prevention and Tobacco Control Act/Adulterated/Misbranded | |||
| Health Plus Inc. | Division of Pharmaceutical Quality Operations IV | CGMP/Finished Pharmaceuticals/Adulterated | |||
| Concord Farms, Inc. | Division of West Coast Imports | Foreign Supplier Verification Program (FSVP) | |||
| Yuni Wholesale, Inc. d/b/a Blow Disposables | Center for Tobacco Products | Family Smoking Prevention and Tobacco Control Act/Adulterated/Misbranded | |||
| Global Vapery LLC and Infinite Vapor LLC | Center for Tobacco Products | Family Smoking Prevention and Tobacco Control Act/Adulterated/Misbranded | |||
| Onofrio's Fresh Cut, Inc. | Office of Human and Animal Food Operations - East Division 1 | CGMP Food/Prepared, Packed or Held Under Insanitary Conditions/Adulterated | |||
| CES LLC | Center for Drug Evaluation and Research | CDER | Drug Product/ |
Tuesday, January 25, 2022
Department of Justice
U.S. Attorney’s Office
Western District of Virginia
FOR IMMEDIATE RELEASE
Monday, January 24, 2022
Former Veterinarian Pleads Guilty to Drug Charges
LYNCHBURG, Va. – A Madison Heights, Virginia man and former veterinarian pleaded guilty to a pair of misdemeanor drug charges related to his diversion of hydromorphone, an opioid drug also known under the trade name of “Dilaudid.”
Patrick Gries, 54, pleaded guilty last week to one count of adulteration of a drug held for sale after shipment in interstate commerce and one count of distribution of a controlled substance without a written prescription.
“The U.S. Attorney’s Office is committed to working with our partners at the FDA, and elsewhere, to ensure consumer products are stored and prescribed using the most safe and secure protocols possible,” United States Attorney Christopher R. Kavanaugh said today. “When individuals with access to controlled substances break those safety protocols, even for individual use, they must be held accountable.”
“The FDA oversees the U.S. drug supply to ensure that it is safe and effective, and those who knowingly tamper with medicines put the health of patients (whether they are human or animal) at risk,” said Special Agent in Charge Mark S. McCormack, FDA Office of Criminal Investigations Metro Washington Field Office. “We will continue to protect the public health and bring to justice health care professionals who take advantage of their unique position and compromise their patients’ health and comfort by tampering with needed drugs.”
According to court documents, from 1994 through 2021, Gries practiced as a Doctor of Veterinary Medicine at a veterinary hospital in Amherst County, Virginia. The veterinary hospital held hydromorphone for sale and maintained supplies of hydromorphone for use in treating pain in the hospital’s animal patients following surgeries.
As the hospital’s primary surgeon, Gries had full access to the hospital’s supply of hydromorphone. Beginning in July 2020 and without a valid prescription, Gries diverted hydromorphone for personal use by withdrawing a portion of the hydromorphone from the vial and injecting it into himself. He would then replace the diverted portion of the hydromorphone with another substance, usually either saline or butorphonal, and then return the altered hydromorphone to the supply maintained by the hospital.
The Food and Drug Administration - Office of Criminal Investigations, the Drug Enforcement Administration - Diversion Control Division, and the Virginia State Police investigated the case.
Component(s):
Updated January 24, 2022
Sunday, January 23, 2022
Department of Justice
U.S. Attorney’s Office
Southern District of California
FOR IMMEDIATE RELEASE
Thursday, January 20, 2022
San Diego Pharmacy Pays $105,000 Penalty for Illegitimately Dispensing Opioids
SAN DIEGO – San Diego’s Balboa Pharmacy has paid $105,000 to resolve allegations that it illegally dispensed opioids and other dangerous drugs to its patients, according to a settlement agreement signed by Balboa Pharmacy and the United States. The settlement stems from the United States’ continued efforts to combat the opioid epidemic on all fronts, including this investigation of whether Balboa Pharmacy illegally dispensed opioids to its patients in violation of the federal Controlled Substances Act.
The Controlled Substances Act states that pharmacists have a responsibility to only fill prescriptions that are written for a legitimate medical purpose while acting in the usual course of professional practice. The United States alleged that Balboa Pharmacy failed to meet its responsibility when it filled opioid prescriptions without resolving—or often even attempting to resolve—“red flags” that the prescriptions raised. “Red flags” are indications that a prescription may be invalid. According to the settlement agreement, Balboa Pharmacy filled prescriptions without resolving the following commonly known red flags:
- large quantities of opioids well above guidelines for treating patients, which sometimes exceeded a daily Morphine Milligram Equivalent of 100;
- dangerous combinations of drugs, including duplicative therapy; opioids and benzodiazepines (e.g., Valium, Xanax); and opioids, benzodiazepines, and muscle relaxants (e.g., Soma), a combination that is colloquially referred to by drug abusers as the “trinity” because of the rapid euphoric effects of this combination of drugs;
- patients who received prescriptions from multiple prescribers, which sometimes were for the same types of controlled substances or for dangerous combinations of drugs; and
- filling prescriptions for patients early, which includes filling a patient’s prescription before the patient’s earlier prescription for the same drug ran out.
The investigation exemplifies the Department of Justice’s willingness to investigate pharmacies that may be filling dangerous prescriptions without first confirming the legitimacy of each prescription. Public health experts have long warned health care providers that overdose risk is elevated in patients receiving medically prescribed opioids, particularly those receiving high dosages. Pharmacists should carefully track the potency of opioids dispensed to patients by noting the Morphine Milligram Equivalent (MME, also commonly referred to as Morphine Equivalent Dose or MED) of prescribed opioids. Among other things, tracking MMEs advances better practices for pain management by reinforcing the need to consider alternatives to using high-dosage opioids to treat pain, and to appropriately justify decisions to use opioids at dosages that place patients at high risk of addiction, abuse, and overdose. Furthermore, dispensing high dosages increases the risk that patients will divert opioids.
“Pharmacies are the last line of defense protecting the public from addictive opioids and other controlled substances,” said U.S. Attorney Randy S. Grossman. “This office will pursue pharmacists who carelessly disregard red flags, opting instead to rubberstamp questionable prescriptions. We will continue to use all available tools to combat the serious opioid epidemic.” Grossman thanked the prosecution team and investigators for their excellent work on this case.
In addition to the settlement agreement, the DEA and Balboa Pharmacy entered into a Memorandum of Agreement in October 2021 in which Balboa Pharmacy agreed to, among other things, develop policies and procedures and training that address the identification and resolution of “red flags.”
“This investigation is a reminder that all pharmacies have a responsibility to ensure that prescriptions are issued for a legitimate medical purpose,” said DEA Special Agent in Charge Shelly S. Howe. “Failure to do so allows prescriptions to become subject to abuse and diversion, fueling the ongoing opioid epidemic. DEA will continue to hold pharmacies, such as Balboa Pharmacy, accountable.”
To report a tip directly to a DEA representative regarding medical personnel writing suspicious opioid prescriptions and pharmacies dispensing large amounts of opioids, call (571) 324-6499, or visit the DEA’s website (https://www.deadiversion.usdoj.gov/) and click on “Report Illicit Pharmaceutical Activities.”
Assistant U.S. Attorney Dylan M. Aste of the U.S. Attorney’s Office for the Southern District of California handled this matter along with DEA investigators.
The claims resolved by this settlement are allegations only and there has been no determination of liability.
Topic(s):
Opioids
Component(s):
Contact:
Assistant U. S. Attorney Dylan M. Aste (619) 546-7621
Press Release Number:
CAS22-0120-Balboa Pharmacy
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