Drugs

Drug Compounder Charged with $10 Million Fraud

The Justice Department says the owner of a Decatur, AL, compounding pharmacy has been charged with conspiracy to defraud the Defense Department Tricare healthcare program out of more than $10 million. Federal prosecutors charged John Lemley and are seeking to have him forfeit nearly $1 million as proceeds of the fraud. A department statement says that most of the forfeit has already been seized from bank accounts owned by Lemley or his business.

As part of a plea agreement, Lemley agreed to forfeit $918,234 and a 2015 Lexus GX-460 vehicle purchased with criminal proceeds.

“This defendant took part in a conspiracy that employed improper contracts, kickbacks, mislabeled drugs, and prescription forgeries in order to bilk millions of dollars from the federal health insurance program meant for America’s military members and their families,” government officials said. “FDA and the Defense Criminal Investigation Service did a tremendous job uncovering their fraud….”

Lemley operated a Decatur pharmacy known as Southern Compounding and also owned Apotheca Supply, which was licensed to relabel and repackage pharmaceutical drugs. And he had a 20% membership interest in Medworx Sunflower, an affiliate of a Mississippi compounding pharmacy.

Federal officials say that Lemley contracted with Medworx Compounding to refer prescriptions to Southern Compounding, paid kickbacks to independent sales representatives as incentives to refer Tricare prescriptions, sold misbranded over-the-counter medications as prescription drugs, and did not reverse claims on prescriptions that he knew were forged.

Lemley faces a maximum sentence of five years in prison, officials said.

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