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For Immediate Release:  
For Further Information:
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October 26, 2009

Office of The Attorney General
- Anne Milgram, Attorney General
Division of Criminal Justice
- Deborah L. Gramiccioni, Director
Office of Insurance Fraud Prosecutor
- Riza Dagli, Acting Insurance Fraud Prosecutor

 

Peter Aseltine
609-292-4791

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Essex County Pharmacists Indicted on Charges They Billed Medicaid Millions of Dollars for Costly HIV/Aids Medicines That They Never Dispensed
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TRENTON - Attorney General Anne Milgram and Division of Criminal Justice Director Deborah L. Gramiccioni announced that 10 defendants, including four pharmacists and three pharmacies, were indicted today on charges they conspired to defraud Medicaid of more than $2.3 million dollars.

The indictment is the result of Operation PharmScam, an investigation conducted by the Office of Insurance Fraud Prosecutor’s Medicaid Fraud Control Unit, the Jersey City Police Department, the U.S. Food and Drug Administration’s Office of Criminal Investigations and the New Jersey Division of Taxation.

The investigation uncovered a scheme in which pharmacy owners and employees bought completed prescription forms for HIV/AIDS drugs and other expensive medicines from indigent patients so Medicaid, Medicare and private insurers could be billed for drugs that were never actually dispensed.

“Pharmacists are supposed to dispense medicines to preserve health and help those who are sick, but these defendants profited by depriving indigent patients of the drugs they needed,” said Attorney General Milgram. “They also stole from the Medicaid program, which provides medicines and health care services to patients who otherwise could not afford them.”

According to Acting Insurance Fraud Prosecutor Riza Dagli, the Medicaid Fraud Control Unit obtained a state grand jury indictment charging the following defendants:

Corporate Defendants

  • Pricus, Inc. d/b/a Campus Pharmacy, 20 Hoyt Street, Newark
  • Orange Drugs, 261 Orange Street, Newark
  • Ajari Inc. d/b/a Harrison Pharmacy, 634 Martin Luther King Blvd., Newark

Pharmacists

  • Nadeem Akhtar, 49, of Upper Saddle River. Pharmacist at Orange Drugs (husband of owner)
  • Omar Mohammad, 31, Pharmacist at Orange Drugs (son of owner)
  • Calvin Osei, 32, of Sayreville. Pharmacist in charge at Campus Pharmacy
  • Nwala Gabriel, 49, of Piscataway. Owner of Harrison Pharmacy

Pharmacy Technicians

The following three pharmacy technicians at Pharmacy of America in East Orange were previously charged by complaint and are also named in the indictment:

  • Jannah Rasheedah Amatul Muid, 25, of East Orange
  • Shivonne Dlacy Forde, 26, of Orange
  • Alicia Stephens, 29, of Newark

All 10 of those defendants are charged with conspiracy (2nd degree), health care claims fraud (2nd degree) and Medicaid fraud (3rd degree). Osei is charged with filing false state income tax returns (3rd degree).

 

 

 

The investigation revealed that Bryan X. Chandler, a.k.a. Dr. X, former owner and director of Samaritan Medical in Newark, recruited patients, especially Medicaid beneficiaries, to come to his clinic so multiple prescriptions could be written in each beneficiary’s name and sold to the pharmacies charged in the investigation. Additional beneficiaries who were not patients of Samaritan also participated in the scheme. Chandler has pleaded guilty in the scheme.

Patients who agreed to go without their medicines were paid cash at the pharmacies for their prescriptions, which were used to fraudulently bill Medicaid, Medicare and private insurers. In other instances, the medicines were dispensed, but the patients sold them to Chandler, who returned the medicines to the pharmacies for a share of the Medicaid payments. Prescriptions for HIV/AIDS drugs and other expensive specialty drugs were billed to Medicaid for thousands of dollars, 10 to 30 times the amount paid to the patients.

The indictment alleges that the defendants conspired in schemes by which false claims were submitted for Pharmacy of America, Orange Drugs, Campus Pharmacy and Harrison Pharmacy. The defendants allegedly submitted a total of more than $2.3 million in false claims.

“I commend the investigators and attorneys responsible for this complex and far-reaching investigation,” said Director Gramiccioni. “Their diligence is a testament to our commitment to root out the fraud that is driving up costs for Medicaid and health care generally.”

“As long as dishonest pharmacists see the high price of many prescription medicines as an inducement to fraudulently bill Medicaid, we will remain vigilant to detect and prosecute their crimes,” said Acting Insurance Fraud Prosecutor Riza Dagli.

Deputy Attorney General Debra Conrad presented the case to the state grand jury. The investigation was conducted by members of Medicaid Fraud Control Unit, North and Central Offices, led by Detective Danielle Han, Detective Kevin Gannon, Detective Joseph Jaruszewski, Detective Jacqueline Latty and Sergeant Fred Weidman as well as Auditor Cleair Budhu, under the supervision of Lt. Joseph Waters, Deputy Chief of Detectives Rita Binn, Acting Insurance Fraud Prosecutor Riza Dagli, Deputy Attorney General Erik Daab, Deputy Chief of the Medicaid Fraud Control Unit, Deputy Attorney General Debra Conrad and Deputy Attorney General Sherry Wilson. They were assisted by Auditor Kevin Curry of the Division of Taxation.

Deputy Attorney General Carol Stanton Meier is handling related asset forfeiture actions for the Division of Criminal Justice.

Attorney General Milgram credited all of the detectives, officers and investigators with the Division of Criminal Justice, Division of Taxation, Jersey City Police Department and the U.S. FDA Office of Criminal Investigations who assisted in Operation PharmScam.

Second-degree crimes carry a maximum sentence of 10 years in state prison and a $150,000 fine, while third-degree crimes carry a maximum sentence of five years in prison and a $15,000 fine.

The indictment is merely an accusation and the defendants are presumed innocent until proven guilty.

The indictment was handed up to Superior Court Judge Linda R. Feinberg in Mercer County, who assigned the case to Essex County, where the defendants will be ordered to appear in court at a later date to answer the charges.

Anyone with information about fraud or abuse involving the Medicaid program or Medicaid providers is urged to call the Medicaid Fraud Control Unit toll free at 1-877-55-FRAUD or visit www.NJInsuranceFraud.org. All information received will remain confidential.

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