Human Medications, Human Drugs, Animal Medications, Animal Drugs, Pharmacy law, Pharmaceutical law, Compounding law, Sterile and Non Sterile Compounding 797 Compliance, Veterinary law, Veterinary Compounding Law; Health Care; Awareness of all Types of Compounding Issues; Pharmacy Benefit Managers (PBMs), Outsourcing Facilities Food and Drug Administration and Compliance Issues
Thursday, June 3, 2021
NY pharmacists call for passage of bills to ‘save’ their businesses
NY pharmacists call for passage of bills to ‘save’ their businesses: Pharmacists and elected officials rallied outside the state capitol Wednesday, urging lawmakers to pass bills they say would save New York’s independent pharmacies. Opponents of the legislation cla…
Department of Justice
U.S. Attorney’s Office
Southern District of Florida
FOR IMMEDIATE RELEASE
Friday, May 28, 2021
Georgia Man Sentenced to 135 Months’ Imprisonment for Role in Health Care Fraud Scheme Against Tricare
Miami, Florida -- A Georgia man was sentenced yesterday to over 11 years in federal prison for defrauding Tricare of approximately $12 million through a South Florida compounding pharmacy fraud scheme. Tricare is the health care benefit program covering military personnel and their dependents.
According to court documents, 51-year-old Erik Santos and his co-conspirators ran the scheme as follows: Santos paid recruiters to convince Tricare beneficiaries to fill prescriptions for expensive, supposedly tailor-made, compounded medications that the beneficiaries did not need. Santos paid doctors to approve pre-printed prescriptions for large amounts of these medications. The doctors did not see the beneficiaries or otherwise consider their medical needs before approving the prescriptions. Lastly, Santos steered the Tricare beneficiaries to fill their prescriptions with Patient Care America (PCA), a compounding pharmacy located in Broward County, Florida. PCA would bill Tricare for expensive drug formulations that had little to no therapeutic value. Many of the compounded medications were billed to Tricare at $10,000 to $15,000 for a month’s supply, even though the ingredients used in the mixtures were little more than common pain or scar creams. Santos’s fraudulent referrals caused an actual loss to the Tricare program of approximately $12 million. PCA pharmacy paid Santos over $7 million in prescription referral kickbacks.
In addition to the prison sentence, the Court imposed restitution in the amount of $11.8 million and entered a forfeiture judgement of approximately $7.6 million. On January 27, 2021, Santos pled guilty in federal district court in Ft. Lauderdale to one count of conspiring to commit health care fraud and wire fraud.
Acting U.S. Attorney Juan Antonio Gonzalez of the Southern District of Florida, Special Agent in Charge Cynthia A. Bruce of the Defense Criminal Investigative Service (DCIS), Southeast Field Office, and Special Agent in Charge George L. Piro of FBI Miami announced the sentence.
“Criminals steal exorbitant amounts of money from our government health programs through prescription medication fraud schemes. This significant sentence recognizes the seriousness of the crime,” said Acting U.S. Attorney Gonzalez. “Those who use kickbacks and other illegal activity to bilk taxpayer dollars from vital public programs will be held accountable.”
“Billing healthcare programs for medically unnecessary medications not only undermines the viability of those programs, it exploits all citizens,” said DCIS Special Agent in Charge Bruce. “I am pleased with the significant outcome of this investigation and would like to thank the U.S. Attorney’s Office and the investigative team for their tireless effort and great work to hold accountable those who fraudulently bill the Defense Health Agency.”
“Illegal kickbacks undermined the integrity of the Tricare health benefit program by putting profits in front of patient welfare,” said FBI Special Agent in Charge Piro. “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.”
DCIS investigated the case with assistance from FBI Miami, and the Food and Drug Administration-Office of Criminal Investigation. The superseding indictment also named CHAMPVA (the Department of Veterans Affairs’ version of Tricare) as a fraud target and the Department of Veterans Affairs-Office of Inspector General assisted with the investigation.
Assistant U.S. Attorney Jon Juenger prosecuted the case. Assistant U.S. Attorney Daren Grove is handling the asset forfeiture component of the case.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls.
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 on http://pacer.flsd.uscourts.gov, under case number 20-cr-60089.
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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
Department of Justice
U.S. Attorney’s Office
Northern District of Oklahoma
FOR IMMEDIATE RELEASE
Wednesday, June 2, 2021
Texas Man Pleads Guilty to Receiving Kick Back Payments in Exchange for Referrals to OK Compounding
Adam Gallardo Arredondo, 59, of Waxahachie, Texas, pleaded guilty Monday to illegal remuneration for health care referrals. Arredondo admitted that he solicited and received checks from OK Compounding, a Tulsa pharmacy, in exchange for referring his patients’ compounding prescriptions. The compounding prescriptions were paid for by federal healthcare programs; therefore, the kickbacks paid to Arredondo violated federal law.
According to the plea agreement, the United States and Arredondo agreed to the following sentence – 36 months of supervised probation and restitution to be paid in the amount of $216,624.75. Arredondo further agreed to surrender his medical license. U.S. District Judge Gregory K. Frizzell will determine Arredondo’s final sentence at a hearing set for Sept. 24.
In the agreement, Arredondo stated that on January 1, 2013, he signed a Consulting Physicians Agreement with OK Compounding, located in Tulsa. The agreement stated that Arredondo would provide services in exchange for an hourly payment from OK Compounding. In his plea, Arredondo stated that he never provided the services listed in the Agreement but was instead paid for sending all of his patients’ compounding prescriptions to OK Compounding to be filled.
Arredondo also created the company, Taffinder Marketing, LLC, and recruited other physicians to enter into similar contracts with OK Compounding. Like Arredondo, those physicians did not perform the services in their contract; rather, they were paid to send their compounding prescriptions to OK Compounding. Arredondo’s company was paid a monthly fee for the recruitment services. On August 14, 2013, Arredondo received a $10,000 check from OK Compounding as payment for referring the prescriptions. The payment included prescriptions that were paid in whole or in part by the federal programs TRICARE, VA, Medicare and/or Office of Worker's Compensation Programs-Department of Labor.
TRICARE suffered a loss of $16,547.75 as a result of the crime.
Further losses incurred from other offenses not included in the plea agreement totaled $200,077.00. Those losses include:
Department of Labor: $14,746.58
Medicare $53,272.67
Tricare: $119,567.76
VA: $ 12,489.99
The Defense Criminal Investigative Service, the Department of Labor-Office of Inspector General, the Internal Revenue Service, the United States Postal Service-Office of Inspector General, Federal Bureau of Investigation, and United States Department of Health and Human Services-Office of Inspector General conducted the investigation. Assistant U.S. Attorney Melody Noble Nelson is prosecuting the case.
Topic(s):
Health Care Fraud
Component(s):
Contact:
Public Affairs
918-382-2755
Tuesday, June 1, 2021
| 06/01/2021 | 02/19/2021 | Richardson Nutritional Center, LLC/Nutriseeds, Inc. | Office of Human and Animal Food Operations-West Division 5 | New Drug/Misbranded | ||
| 06/01/2021 | 05/10/2021 | DeChoker LLC | Office of Medical Device and Radiological Health, Division 3 | CGMP/QSR/Medical Devices/Adulterated | ||
| 06/01/2021 | 05/11/2021 | Utah Cord Bank LLC | Office Biological Products Operations – Division 2 | Deviations/CFR/Regulations for Human Cells, Tissues & Cellular Products (HCT/Ps) | ||
| 06/01/2021 | 05/18/2021 | MnM Spices Corporation | Division of Northern Border Imports | Foreign Supplier Verification Program (FSVP) | ||
| 06/01/2021 | 05/18/2021 | Lux Commercial Group LLC | Division of Southwest Imports | Foreign Supplier Verification Program (FSVP) | ||
| 06/01/2021 | 05/27/2021 | Incredible Products, SA de CV | Center for Drug Evaluation and Research | Finished Pharmaceuticals/Unapproved New Drug/Misbranded/Adulterated |
| 5/28/2021 | 05/27/2021 | OCLO LLC/OCLO Nanotechnology Science | Center for Drug Evaluation and Research | Unapproved and Misbranded Products Related to Coronavirus Disease 2019 (COVID-19) |
Texas Board of Pharmacy Relevant Information: Adopted and Proposed Rules, Disciplinary Actions, Reminder regarding Compounding Advisory Group
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