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
Sunday, January 23, 2022
Newark Physician and West New York Man Charged with $3.4 Million Health Care and Wire Fraud Conspiracy, Money Laundering, and Making False Statements
epartment of Justice
Newark Physician and West New York Man Charged with $3.4 Million Health Care and Wire Fraud Conspiracy, Money Laundering, and Making False Statements
CAMDEN, N.J. – A Newark physician and West New York man are scheduled to make their initial appearances today on charges of defrauding New Jersey state and local health benefits programs and other insurers out of more than $3.4 million by submitting fraudulent claims for medically unnecessary prescriptions, U.S. Attorney Philip R. Sellinger announced.
Kaival Patel, 53, of West New York, New Jersey, and Saurabh Patel, M.D., 51, a Woodbridge, New Jersey, resident, are charged in a 12-count indictment with conspiracy to commit health care fraud, and wire fraud and four counts of health care fraud. Kaival Patel is also charged with conspiracy to commit money laundering, substantive counts of money laundering, and making false statements to federal agents. The defendants appeared today by videoconference before U.S. Magistrate Judge Sharon A. King and were released on $250,000 each unsecured bond.
According to the indictment:
Kaival Patel and his wife – referred to in the indictment as “Individual 1” – operated a company called ABC Healthy Living LLC (ABC) to market medical products and services, including compound prescription medications. Saurabh Patel is a medical doctor who owned and operated a clinic – referred to in the indictment as “Medical Practice 1” – in Newark. Saurabh Patel is related to Kaival Patel and Individual 1. Paul Camarda, a pharmaceutical sales representative who is listed as a conspirator, pleaded guilty before Judge Kugler in Camden federal court on July 6, 2021, to health care conspiracy and conspiring to commit money laundering and obstruct justice and is awaiting sentencing.
Compounded medications are specialty medications mixed by a pharmacist to meet the specific medical needs of an individual patient. Although compounded drugs are not approved by the Food and Drug Administration (FDA), they are properly prescribed when a physician determines that an FDA-approved medication does not meet the health needs of a particular patient, such as if a patient is allergic to a dye or other ingredient.
Kaival Patel, Saurabh Patel, Camarda, and others learned that certain state and local government employees had insurance that would reimburse up to thousands of dollars for a one-month supply of certain compounded medications. The defendants submitted fraudulent insurance claims for prescription compounded medications to a pharmacy benefits administrator, which provided management services for certain insurance plans that covered state and local government employees. The defendants steered individuals recruited to receive medications from the compounding pharmacies to Saurabh Patel’s medical practice, which enabled him to fraudulently receive insurance payments for those patient visits and procedures. The conduct caused the benefits administrator to pay out $3.4 million in fraudulent claims.
The health care fraud and wire fraud conspiracy count carries a maximum potential penalty of 20 years in prison; the health care fraud charges carry a maximum potential penalty of 10 years in prison; the false statement count carries a maximum penalty of five years in prison – all of these counts are also punishable by a fine of $250,000, or twice the gain or loss from the offense, whichever is greatest. The money laundering charges carry a maximum term of 10 years in prison and a fine of $250,000, or twice the gross gain or loss from the offense or not more than twice the amount of the criminally derived property involved in the transactions.
U.S. Attorney Sellinger credited special agents of the IRS - Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez in Newark; special agents of the FBI’s Atlantic City Resident Agency, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark; and the U.S. Department of Labor Office of Inspector General, New York Region, under the direction of Special Agent in Charge Jonathan Mellone, with the investigation leading to the indictment.
The government is represented by Assistant U.S. Attorneys Christina O. Hud and R. David Walk Jr. of the Criminal Division in Camden.
The charges and allegations contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Wednesday, January 19, 2022
| Apothecary Health Solutions/Right Value Drug Stores, LLC dba Carie Boyd's Prescription Shop | Office of Pharmaceutical Quality Operations, Division II | Compounding Pharmacy/Adulterated Drug Products | ||||
| Green Food Ingredients, LLC | Division of Northern Border Imports | Foreign Supplier Verification Program (FSVP) | ||||
| Cosmo Bio Co., Ltd. | Center for Drug Evaluation and Research | CDER | CGMP/Finished Pharmaceuticals/Adulterated/Misbranded | ||||
| GeroNova Research Inc. | Office of Human and Animal Food Operations - West Division 5 | Internet Marketing of Unapproved and Misbranded Drugs |
| HK Produce Group Inc. DBA Y2S Trading Inc. | Division of Northeast Imports | Foreign Supplier Verification Program (FSVP) | ||||
| Professional Disposables International, Inc. | Division of Pharmaceutical Quality Operations I | CGMP/Finished Pharmaceuticals/Adulterated | ||||
| Foundation Vapor LLC | Center for Tobacco Products | Family Smoking Prevention and Tobacco Control Act/Adulterated/Misbranded | ||||
| Genesis Partnership Company SA | Center for Drug Evaluation and Research | CDER | Drug Product/Misbranded | ||||
| Sunstar Americas, Inc. | Office of Medical Devices and Radiological Health Operations Div. 2 Central | CGMP/QSR/Medical Devices/Adulterated | ||||
| Rocky Mountain Ecigs, LLC | Center for Tobacco Products | Family Smoking Prevention and Tobacco Control Act/Adulterated/Misbranded |
Tuesday, January 18, 2022
FOR IMMEDIATE RELEASE
Ringleader in prescription drug conspiracy sentenced to federal prison
Defendant forged prescriptions to obtain highly addictive opioid
SAVANNAH, GA: The leader of a conspiracy that used forged prescriptions to obtain and sell large amounts of highly addictive opioids has been sentenced to federal prison.
Raheem Hardy, 29, of Decatur, Ga., was sentenced to 55 months in prison after pleading guilty to Conspiracy to Possess with Intent to Distribute Oxycodone, said David H. Estes, U.S. Attorney for the Southern District of Georgia. U.S. District Court Judge R. Stan Baker also ordered Hardy to serve three years of supervised release after completion of his prison term. There is no parole in the federal system.
“By forging wholesale numbers of fake prescriptions, Raheem Hardy poured fuel on the raging fires of opioid addiction,” said U.S. Attorney Estes. “The teamwork of our law enforcement partners brought this scheme to an end, and Hardy is being held accountable.”
As described in court documents and testimony, Hardy created forged prescriptions for drugs, including the opioid pain medication Oxycodone, using the names and DEA registration numbers of at least six physicians. He then sold the paper prescriptions to others in the conspiracy who filled the prescriptions and sold the drugs to users. The scheme crossed Georgia into South Carolina and Alabama, as conspirators filled or attempted to fill prescriptions in those states. The conspiracy resulted in the unlawful acquisition and distribution of more than 4,000 pills.
The case originated in December 2019 in the U.S. Drug Enforcement Administration’s Tactical Diversion Squad in Columbia, S.C., when fraudulent prescriptions were presented to multiple pharmacies in the area. In April 2020, a pharmacist in Savannah raised an alarm when she questioned the authenticity of a conspirator’s prescription for Oxycodone and contacted the Savannah Police Department and the DEA Savannah Tactical Diversion Squad. A February 2021 indictment alleged Hardy and nine co-conspirators filled at least several dozen fraudulent prescriptions across Georgia to procure thousands of pills.
Six other defendants have pled guilty and been sentenced to incarceration. Three defendants are awaiting trial and are considered innocent unless and until proven guilty.
“Although these pills came from legitimate pharmacies, the prescriptions were fake,” said Robert J. Murphy, the Special Agent in Charge of the DEA Atlanta Field Division. “Raheem Hardy and his accomplices are not licensed medical professionals, and had no business filling prescriptions for these highly sought after pills. After this sentencing, other criminals have been put on notice that these illicit activities will lead to significant time behind bars.”
The case was investigated by the DEA Tactical Diversion Squads in Savannah and Columbia, S.C.; the Chatham-Savannah Counter Narcotics Team; the Pooler Police Department; and the Savannah Police Department, with assistance from South Carolina Department of Health and Environmental Control, the Columbia County Sheriff’s Office and Richmond County Sheriff’s Office, and prosecuted for the United States by Southern District of Georgia Assistant U.S. Attorneys Matthew A. Josephson and Organized Crime Drug Enforcement Task Force Coordinator Marcela C. Mateo.