Pharmacy Owners Indicted In Billion-Dollar Health Care Scheme

PALM HARBOR, FL -- A group of Tampa Bay pharmacy owners has been charged in a $1 billion health care fraud scheme.

The District Court for the Eastern District of Tennessee unsealed a 32-count indictment on Friday, Oct. 12, charging the men with conspiracy to commit health care fraud, mail fraud and introducing misbranded drugs into interstate commerce. The court also unsealed an additional two plea agreements and an information charging another man and his company for his role in the scheme.

Andrew Assad, 33, of Palm Harbor, Peter Bolos, 41, of Lutz, and Michael Palso, 44, of Odessa were indicted along with their compounding pharmacies, Synergy Pharmacy Services, located in Palm Harbor, and Precision Pharmacy Management, located in Clearwater.

Co-conspirator Larry Everett Smith, 48, of Pinellas Park, also a pharmacy compounder, and his companies, Tanith Enterprises, ULD Wholesale Group, Alpha-Omega Pharmacy, all located in Clearwater; Germaine Pharmacy located in Tampa; and Zoetic Pharmacy located in Houston, Texas, were also named as defendants.

According to the Department of Justice, on Sept. 26, HealthRight LLC, a telemedicine company with locations in Pennsylvania and Florida, and Scott Roix, 52, of Seminole, the CEO of HealthRight, pleaded guilty to felony conspiracy for their roles in the telemedicine health care fraud scheme. Roix and HealthRight also pleaded guilty to conspiring to commit wire fraud in a separate scheme for fraudulently telemarketing dietary supplements, skin creams and testosterone.

The indictment alleges that from June 1, 2015 through April 1 of this year, the pharmacy owners conspired to deceive tens of thousands of patients and more than 100 doctors across the country to bilk private health care benefit programs out of $174,000,000. The indictment also alleges that the defendants submitted $931,000,000 in fraudulent claims for payment.

Investigators say the defendants set up an elaborate telemedicine scheme in which HealthRight fraudulently solicited insurance coverage information and prescriptions from consumers across the country for prescription pain creams and similar products. The indictment states that doctors approved the prescriptions without knowing that the defendants were massively marking up the prices of the invalidly prescribed drugs, which the defendants then billed to private insurance carriers.

Assad, Bolos, Palso and Smith appeared in court on Oct. 11 before U.S. Magistrate Judge Anthony E. Porcelli in the U.S. District Court for the Middle District of Florida. All four defendants were released on bond and are scheduled for an initial appearance and arraignment in the U.S. District Court in the Eastern District of Tennessee before U.S. Magistrate Judge Clifton Corker on Oct. 25.

If convicted, Assad, Bolos, Palso and Smith face a term of up to 20 years in prison for each mail fraud charge, up to 10 years in prison for the conspiracy, and up to three years in prison for introducing misbranded drugs into interstate commerce. Additionally, they face fines of up to $250,000 and up to three years of supervised release for each count.

Their companies face fines of up to twice the gross loss sustained as a result of the conspiracy. The indictment also seeks forfeiture of approximately $154,000,000.

In addition to the health care fraud conspiracy, the defendants are accused of committing wire fraud as part of a scheme to use HealthRight’s telemarketing facilities to fraudulently sell millions of dollars’ worth of products such as weight loss pills, skin creams, and testosterone supplements with false claims about their results.

Roix and HealthRight pleaded guilty before U.S. District Judge J. Ronnie Greer of the Eastern District of Tennessee. Roix faces a maximum sentence of five years of in prison for each conspiracy. Sentencing is set for Feb. 13.

The investigation was conducted by the Nashville, Tennessee office of the U.S. Department of Health & Human Services Office of Inspector General; the Nashville office of the Food and Drug Administration Office of Criminal Investigations; the Buffalo, New York, office of the U.S. Postal Inspection Service; the Knoxville and Johnson City, Tennessee, offices of the Federal Bureau of Investigation; the Atlanta, Georgia, Office of Personnel Management Office of the Inspector General; and the Tampa office of Homeland Security Investigations.

Image via Shutterstock

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