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Compounding Pharmacy Fraud

This archive displays posts tagged as relevant to compounding pharmacies and fraud related to compounding pharmacies. You may also be interested in our pages:

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February 2, 2021

The owner of Mississippi-based Medworx Compounding and Custom Care Pharmacy, Marco Bisa Hawkins Moran, has been sentenced to ten years in prison and ordered to pay $34.3 million in fines and restitution following his guilty plea on charges related to a conspiracy to defraud TRICARE and other healthcare programs.  As part of the scheme, which resulted in the submission of $22.1 million in fraudulent claims, Moran and his co-conspirators adjusted prescription formulas to ensure the highest reimbursement, paid marketers and physicians kickbacks and bribes to obtain prescriptions for high-yield compounded medications without regard to medical necessity, and routinely waived and/or reduced the collection of copayments. USAO SD MS

Top Ten Financial and Healthcare Fraud Prison Sentences of 2020

Posted  01/27/21
Hands in handcuffs behind back of white man in business suit
Individuals involved in financial and healthcare fraud schemes face not just civil liability, but also criminal penalties – including prison time. In 2020, the Department of Justice obtained substantial prison sentences in a myriad of cases involving healthcare and financial frauds, many of which involved convictions of the type of fraudulent schemes that whistleblowers report. Whistleblowers play an essential role...

January 15, 2021

The co-owner of multiple compounding pharmacies and pharmaceutical distributors in Mississippi has been sentenced to 18 years in prison and ordered to pay over $287 million in restitution and over $56 million in forfeiture after pleading guilty to healthcare fraud and money laundering.  As part of his guilty plea, Wade Ashley Walters admitted to being the mastermind behind a four-year scheme that defrauded TRICARE and private health benefit programs of over $287 million.  To perpetuate the fraud, Walters and his co-conspirators solicited and paid recruiters to procure prescriptions for highly reimbursed compounded medications, solicited and paid physicians to authorize prescriptions for same, adjusted prescription formulas to ensure the highest reimbursement possible, and improperly waived or reduced mandatory beneficiary copayments.  USAO SDMS

July 23, 2020

Two pharmacists who were co-owners of Advantage Pharmacy in Mississippi have been sentenced to over 12 years in prison each and ordered to pay between $9 million and $29 million in civil monetary judgment, and between $185 million and $189 million in restitution for committing healthcare fraud.  According to the press release, Glenn Doyle Beach and Hope Thomley marketed, dispensed, and distributed compounded medications without regard to medical necessity, causing various health benefit programs, including TRICARE, to pay over $200 million in reimbursements.  Thomley’s husband, Randy Thomley, has been sentenced to 8 years in prison and ordered to pay judgment and restitution of $3.6 million each for his role in helping to recruit TRICARE beneficiaries.  USAO SDMS

June 25, 2020

George Philip Tompkins of Houston, Texas, the former owner of Piney Point Pharmacy, was sentenced to ten years in prison following his conviction on charges of healthcare fraud, unlawful kickbacks, money laundering, and wire fraud.  Tompkins billed $21.8 million to federal and state worker’s compensation programs for medically unnecessary compound gels and creams, paying kickbacks to generate prescriptions while claiming that the kickbacks were legitimate marketing expenses. Thompson was also ordered to pay restitution of $12.3 million. DOJ

June 16, 2020

A doctor in Mississippi has been sentenced to four years in prison and ordered to pay nearly $5 million in restitution and judgment for committing healthcare fraud against multiple insurers, including TRICARE.  In exchange for a 35% cut of reimbursements, Dr. Shahjahan Sultan had agreed to enter into a contract with a local pharmacy to prescribe expensive compound medications to insured patients, which he did without regard to medical necessity, and which resulted in over $8 million in losses to insurers.  USAO SDMS

April 2, 2020

FPR Specialty Pharmacy LLC and Mead Square Pharmacy, Inc., along with owners Christopher Casey and William Rue, have agreed to pay $426,000 to settle a whistleblower-brought case alleging violations of the Anti-Kickback Statute and False Claims Act in connection with a compounded prescription analgesic cream called Focused Pain Relief.  As part of the settlement, the defendants admitted that from 2011 to 2015, they sold prescription drugs to patients in states they were not licensed to sell in, failed to charge mandatory co-pays to beneficiaries of various federal healthcare programs, and paid sales agents to solicit physicians to prescribe the cream.  USAO SDNY

April 1, 2020

A physician’s assistant in Louisiana, Stephen Honeycutt, has agreed to pay $620,500 for accepting illegal kickbacks from OK Compounding, LLC, which has been involved in multiple enforcement actions of a similar nature across the country.  Over a period of about six months in 2013, Honeycutt prescribed expensive compounded pain creams to patients, many of whom were Medicare and TRICARE beneficiaries, in exchange for kickbacks disguised as medical director fees.  USAO NDOK

February 3, 2020

Senthil Kumar Ramamurthy of Texas has been sentenced to 10 years in prison for participating in two fraud schemes that amounted to $9.6 million in losses by Medicare and TRICARE.  In the first scheme, which ran for 10 months in 2014, Ramamurthy and his co-conspirators were paid millions of dollars by compounding pharmacies to get TRICARE beneficiaries to sign up for medically unnecessary compounded prescription drugs.  To get beneficiaries to sign up, defendants had falsely represented that the drugs would be free, when in fact co-payments were required.  In the second scheme, which ran from 2015 onward, Ramamurthy and his co-conspirators paid doctors to refer Medicare beneficiaries—without first examining them—for needless genetic cancer screening tests.  Many of Ramamurthy's co-conspirators have plead guilty and face sentencing later this month.  USAO SDFL

December 19, 2019

Five individuals have been sentenced for their roles in a scheme to defraud TRICARE through the submission of false and fraudulent claims for compounded prescription pain creams.   Marketing firm Centurion Compounding, Inc., owned by  Frank Monte and Kimberley Anderson, entered into an agreement with LifeCare Pharmacy, owned by Carlos Mazariegos and Benjamin Nundy, to pay kickbacks to Dr. Anthony Baldizzi in exchange for him writing prescriptions for compounded creams marketed by Centurion to TRICARE beneficiaries. LifeCare billed health insurers, including TRICARE, more than $12.4 million for compounded cream prescriptions written by Baldizzi and marketed by Centurion, realizing a profit of more than $10 million, which it shared with Baldizzi, Monte, and Anderson.  Centurion also caused TRICARE to be billed additional fraudulent amounts through one or more other pharmacies.  Monte and Anderson of Centurion were sentenced to 2 years and 1.5 years, respectively, and Monte forfeited more than $3 million in property.  Baldizzi was sentenced to 1 year in prison, ordered to forfeit $100,000, and will surrender his license to practice medicine.  Mazariegos and Nundy of LifeCare were sentenced to 1 year in prison and 5 years probation, respectively, and paid over $12.8 million in restitution and forfeiture.  USAO MD FL
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