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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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October 22, 2018

A Kentucky-based medical equipment supplier has agreed to pay $5,254,912 to settle claims based on the False Claims Act that it defrauded many government insurers, including Kentucky Medicaid, Medicare, and CHAMPVA (under the Department of Veterans Affairs), by submitting fraudulent claims relating to certain compounded creams that it produced. According to the DOJ press release, in order to be properly reimbursed, Cooley Medical Equipment, Inc. was required to obtain prior authorization from Kentucky Medicaid and CHAMPVA before using certain powdered ingredients. Instead, Cooley claimed to use cream-based versions of the same ingredients, then submitted thousands of false claims to the insurers, and received millions of dollars in reimbursements. The company eventually came clean and self-disclosed to the US Attorney's Office, allowing it to pay a fine of 1.5 times instead of the usual 3 times loss suffered by the government. USAO EDKY

October 18, 2018

Four individuals have pleaded guilty to conspiring to violate the Anti-Kickback Statute for a scheme that made payments to patient recruiters and a medical office assistant to find TRICARE beneficiaries to get prescriptions for compounded prescription pain cream, scar cream, and supplements from a doctor who had never seen the patients.  In less than one year, the scheme generated over $10 million in compound prescriptions for over 100 TRICARE beneficiaries.  E.D. Ark.

Healthcare Fraud: it’s not just Medicare and Medicaid

Posted  10/17/18
Last year, the U.S. Department of Justice recovered $2.4 billion in settlements and judgments involving fraud in the healthcare industry perpetrated against government payors. But government programs like Medicare and Medicaid aren’t the only targets of massive healthcare fraud schemes. A recent Department of Justice press release announced the unsealing of a 32-count indictment containing charges against four...

September 17, 2018

In the largest healthcare fraud case ever to come out of Mississippi, the co-owner of two Mississippi-based compounding pharmacies, Marco Bisa Hawkins Moran, has pleaded guilty to defrauding TRICARE of more than $22 million. As part of the fraud, Moran and others allegedly paid kickbacks to doctors and marketers to prescribe drugs for beneficiaries covered by TRICARE and other lucrative health benefit programs. Additionally, they allegedly selected formulas meant to maximize profits instead of benefit individuals, and submitted fraudulent reimbursement claims to TRICARE. The case spanned multiple states across the country, including California, Tennessee, Arkansas, and Connecticut, with twelve people charged and nine convicted so far. USAO SDMS

September 13, 2018

One of the owners of an unnamed compounded drug marketing company has pleaded guilty to defrauding a state employee health benefit plan. According to the complaint, over the course of a year, Robert Madonna and others bribed a number of state employees to obtain prescriptions for medically unnecessary but expensive compounded drugs, including vitamins and creams to manage fungus, pain, and scars. The alleged fraud caused more than $2 million in losses to the New Jersey State Health Benefits Plan. Madonna will now pay $2,092,791 in restitution and be sentenced early next year to a possible maximum of 10 years in prison and a $250,000 fine. USAO NJ

September 11, 2018

Through a tip by Connecticut State Comptroller, Kevin Lembo, a Florida-based compounding pharmacy, Assured, Rx, along with multiple individuals—many of them former and current Connecticut state government employees—have been sued by the State of Connecticut for alleged violations of the Connecticut False Claims Act. The pharmacy is accused of paying kickbacks to co-defendants Nicholas and Lisette Maulucci, who then paid other individuals to file reimbursement claims from a state employee health plan for expensive compound drugs manufactured by Assured, Rx. Through their actions, the Mauluccis allegedly received kickbacks totaling upward of $2.6 million, and cost the Connecticut Pharmacy Benefit Plan approximately $10.9 million. CT AG

June 7, 2018

Mississippi physician Albert Diaz was sentenced to 42 months in prison for prescribing medically unnecessary compounded medications to TRICARE patients he had not examined and falsifying medical records to make it appear he had treated the patients. The fraud cost TRICARE and other insurers more than $3 million. DOJ

April 26, 2018

Nicholas A. Borgesano Jr., owner of Florida pharmacy A to Z Pharmacy was sentenced to 180 months in prison and ordered to pay $54 million in restitution for his role in a massive compounding pharmacy fraud scheme. DOJ

March 30, 2018

Larry B. Howard, the owner of an Orlando-based Fertility Pharmacy, was sentenced to serve 160 months in prison and forfeit over $4.3 million for his role in a kickback scheme involving pain and scar creams that resulted in the payment of approximately $4.3 million in false and fraudulent claims to TRICARE. DOJ
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