Compounding pharmacies have been under intense scrutiny by Medicare, private third-party insurance and workers’ compensation insurance carriers for almost ten years. The criminal cases take so long to investigate and prosecute that there is a significant lag time between the time of operations and prosecution.
Compounding cases that proceed criminally usually involve aggressive and illegal marketing, medical necessity issues, and violation of pharmacy compounding laws and regulations. A recent case gives insight into a case involving compounding pharmacies where preprinted physician prescription pads, waiving of patients’ copays, and attempts to hide the waiving of copays caused criminal problems.
According to court documents, Fusion Rx Compounding Pharmacy was a provider of compounded drugs. What are compounded drugs? They are non-FDA approved medications that are supposed to be tailored to the needs of a specific patient when FDA-approved medications do not meet the health needs of patient. The pharmacy obtains a compounding license and combines, mixes or alters two or more drugs. The physician is supposed to prescribe and order the compounded medication and indicate what drugs are to be compounded to make it for that particular patient. Fusion RX was owned by Navid Vahedi, a Los Angeles pharmacist.
The prosecution alleged in its charging documents and there were admissions in the plea agreements that pharmacist Mr. Vahedi and Fusion Rx paid millions of dollars in kickback payments through the businesses of two marketers to send prescriptions for compounded drugs to Fusion Rx. It was also alleged that Mr. Vahedi and the of his two marketers provided physicians with preprinted prescription script pads that offered “check-the-box” options on the form to maximize the amount of insurance reimbursement for the compounded drugs. From May 2014 to at least February 2016, it was alleged that Fusion Rx received approximately $14 million in reimbursements on its claims for compounded drug prescriptions.
