PASSAIC COUNTY, NJ —A former executive of a Passaic County mail-order pharmacy with a storefront in the city has been sentenced to prison in a health care fraud case tied to $33 million in reimbursements.
On April 1, Adam Brosius, 61, of Delray Beach, Florida, was sentenced to two years in prison for his role in a $33 million health care fraud and kickback scheme, according U.S. Attorney Robert Frazer.
Brosius worked at Main Avenue Pharmacy in Clifton as director of business development and later as its president, according to court documents.
The case centered on Main Avenue Pharmacy, which prosecutors said was used from 2014 through 2016 to run an illegal kickback scheme involving medically unnecessary compounded drugs.
The drugs included scar creams, pain creams, migraine medication, and vitamins. According to court documents, Brosius and others identified compounded drugs that would bring high reimbursements from health insurers, including federal and commercial payers.
Once those formulas were identified, large prescription pads listing the formulas were created and distributed to marketers around the country, according to the documents. Those marketing companies then distributed the prescription pads to telemedicine companies and doctors with whom they had a financial arrangement.
After prescriptions were filled, Main Avenue submitted claims for reimbursement to health care benefit programs, including Medicare, Tricare, and commercial payers in New Jersey and elsewhere.
Once reimbursement was received, Main Avenue paid kickbacks to marketers who generated the prescriptions. Court records state that the pharmacy signed contracts with many marketers that detailed the arrangement and called for payments based on the volume of compounded prescription referrals and the reimbursement amounts Main Avenue received.
According to the case record, Main Avenue received about $33 million in reimbursements for compounded medications alone from health care benefit programs. More than $5.8 million of that total was paid by TRICARE, identified in the announcement as a federal payer.
In addition to the prison sentence, U.S. District Judge Madeline Cox Arleo ordered Brosius to pay $33 million in restitution and $27 million in forfeiture. The sentence also includes a term of supervised release.
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