Pharmacy Settles Whistleblower Case Involving Drug-Recycling Allegations

Long-term care pharmacy Remedi Seniorcare, Inc. has agreed to pay $1,279,575 to settled a qui tam action, raising allegations that it illegally distributed misbranded and adulterated drugs in interstate commerce.  This was a unique and important whistleblower case, alleging that, instead of disposing unused medications, the pharmacy unlawfully recycled, repackaged, and redistributed thousands of drugs to Medicare and Medicaid beneficiaries. This was the sixth settlement this year for the national whistleblower law firm of Nolan & Auerbach, P.A, whose False Claims Act qui tam cases have recovered more than $1.3 billion for the US Treasury.

The whistleblower alleged that every day, Remedi would typically pick up twenty or more tote bags of unused medicine from long-term care facilities, ostensibly destined for disposal. However, instead of properly disposing the medication, the pharmacy would allegedly recycle the drugs, by removing pills and tablets from their packaging in unsterile environments, sorting the drugs into unsanitary bins, and inserting the medicine into new packaging. According to the whistleblower, the sorting process regularly comingled drugs with different expiration dates, lot numbers, and potency. These alleged practices caused federal and state government health care programs to pay for adulterated drugs.

To ramp up these operations, the pharmacy supposedly hired outside “efficiency experts,” who made recommendations on how the pharmacy could further streamline its recycling scheme. By repackaging everything from blisterpacks to bulk syringes, the pharmacy was able to pocket funds that would have been spent on new medications.

The Food and Drug Administration is the agency responsible for protecting the health and safety of the American public by ensuring, among other things, that pharmaceuticals designed for use in humans are safe and effective for their intended uses and are labeled accurately and in compliance with the law. The federal law imposes numerous requires on the distribution of prescription drugs, including that the drugs are not misbranded or adulterated.

For more information about qui tam law and pharmaceutical fraud, contact Nolan and Auerbach, PA.