Ten defendants, including several locals, were charged in a 103-count indictment, including a nurse practitioner, and the owners, a pharmacist, managers, sales representatives, and billers of a Haleyville, Ala. company, according to federal prosecutors.
The indictment charges them with fraudulently billing health care insurers and prescription drug administrators for more than $200 million in prescription drugs. In one listed instance, the defendants’ fraudulent conduct caused a prescription plan administrator to pay over $29,000 for one tube of a cream advertised as treating “general wounds.”
The suspects were doing business as Global Compounding Pharmacy.
The indictment filed in U.S. District Court charges the following individuals:
1. John Jeremy Adams, 38, of Panama City Beach, Florida, an owner and president of Global, charged in 38 counts;
Adams was arrested on Wednesday and arraigned on Thursday in the Northern District of Florida.
2. Ashley Adams, 36, of Santa Rosa Beach, Florida, director of HR for Global, charged in 10 counts;
3. Jeffrey Black, 54, of Destin, Florida, an owner and vice president and COO of Global, charged in 18 counts;
4. James A. Mays, III, 43, of Winfield, Alabama, a pharmacist at Global, charged in 20 counts;
5. Jessica Linton, 36, of Clearwater, Florida, the manager of the billing team at Global, charged in 24 counts;
6. Lisa Holmes, 40, of Troy, Alabama, a district manager supervising sales representatives at Global, charged in 12 counts;
7. John Gladden, 49, of Tallahassee, Florida, a district manager supervising sales representatives at Global, charged in 9 counts;
8. Christi Cunningham, aka Christi Mook, 34, of Crestview, Florida, a sales representative at Global, charged in 9 counts;
9. Juan Rodriguez, 41, of Tampa, a biller at Global, charged in 6 counts; and
10. Lori Dawn Edenfield, 45, of Marianna, Florida, a nurse practitioner, charged in 32 counts.
According to the indictment, Global, which described itself as “one of the top three largest compounding pharmacies in the United States,” primarily shipped compounded and other drugs from its Haleyville facility, but did most of its prescription processing, billing and customer service at its “call center” in Clearwater, Fla.
The company hired sales representatives who were located in various states and were responsible for generating prescriptions from physicians and other prescribers. The company also worked with affiliated pharmacies.
The indictment describes a multi-faceted health care fraud and mail fraud conspiracy and scheme in which the defendants billed for medically unnecessary drugs. Aspects of the scheme included paying prescribers to issue prescriptions; directing employees to get medically unnecessary drugs for themselves, family members, and friends, to be filled and billed by Global and other related pharmacies; altering prescriptions to add non-prescribed drugs including controlled substances such as Tramadol and Ketamine; automatically refilling prescriptions—often as many as 12 times—regardless of patient need; routinely waiving and discounting co-pays to induce patients to obtain and retain medically unnecessary drugs; and billing for drugs without patients’ knowledge and hiding that conduct from patients by mailing the drugs to J. Adams’ home, officials wrote.
According to the indictment, when prescription drug administrators attempted to police this fraudulent conduct, the defendants evaded and obstructed those efforts, including by providing false information in response to audits and diverting their billing through affiliated pharmacies. In executing the scheme, the defendants billed health insurance plans and their prescription plan administrators over $200 million and were paid over $50 million, prosecutors wrote.
The indictment states that the defendants targeted multiple health insurance plans, including Global’s, Blue Cross Blue Shield of Alabama, and plans providing health insurance to the elderly, disabled, members of the military, and veterans—Medicare, TRICARE, and CHAMPVA, among others.
In addition, the defendants targeted the health insurance plans of Medtronic, a medical device company, and Novartis Pharmaceuticals Corp., a pharmaceutical company, both known by some of the defendants to have high-reimbursing health insurance. According to the indictment, Adams and Black would hire individuals known to be on Medtronic and Novartis’s health insurance plans, and direct them to get prescriptions for medically unnecessary drugs for themselves, family members, and friends, and then pay them a commission for these prescriptions.
Some of the conduct described in the indictment includes billing for female sex creams issued to male patients, billing for drugs issued to children that Global stated were contraindicated for use by children, and billing for drugs that patients did not need and therefore simply discarded in the trash.