A pharmacy owner and employee have been convicted on multiple charges related to a massive fraud scheme that bilked the federal TRICARE program for more than $30 million, the U.S. Department of Justice announced.
TRICARE provides coverage for active duty military and their families, as well as retired veterans. The fraudulent scheme also yielded losses for the Federal Employee Health Benefit Program.
A federal jury convicted pharmacy owner Serge Francois of conspiracy to commit health care fraud, twelve counts of health care fraud, conspiracy to pay kickbacks in connection with a federal health care program, five counts of paying such kickbacks, and twelve counts of money laundering. He was also found guilty of eight counts of introducing misbranded drugs into interstate commerce, four counts of making false statements related to health care matters, and one count of making a false statement on a DEA form.
Patrick Tonge was convicted on the same conspiracy charges, eleven counts of health care fraud, three counts of paying kickbacks, and two counts of money laundering, the DOJ said.
Francois owned and operated Pompano Beach, Florida pharmacy Atlantic Pharmacy and Compounding. He worked closely with Tonge, entering into a "vast conspiracy with marketers" who paid physicians to write prescriptions for topical medications that carried price tags as high as $17,000 a bottle.
"As the pharmacist in charge, Francois was responsible for the compounded medications, which were made in-house by the pharmacy," the DOJ said, citing evidence presented at trial.
Francois, Tonge and co-conspirators agreed to automatically refill the prescriptions, which resulted in numerous refills being sent to patients that were not needed. They did not charge copays so that patients would be less inclined to return the prescriptions, the DOJ said. Francois and Tonge paid marketers from profits received for the prescriptions. Marketers in turn paid the physicians. Also as part of the scheme, evidence showed physicians never saw or examined the purported patients, instead using their personal identification information to write the prescriptions, the DOJ said.
Evidence also showed Francois and Tonge specifically targeted the TRICARE program, with the Atlantic Pharmacy billing more than $37 million to TRICARE and FEHBP. TRICARE paid out over $30 million in false and fraudulent claims, the DOJ said.
Francois used proceeds from the scheme to buy a $3.6 million mansion that once belonged to Dwayne "the Rock" Johnson, along with a Ferrari, two Rolls Royces, and over $1 million in luxury automobiles, according to the DOJ.
In total, seventeen individuals pled guilty or were convicted for their involvement with the fraudulent scheme or receipt of kickbacks.