Medical Technology

Pill Mill Psychiatrist is in Prison and must forfeit cars and cash

Psychiatrist Sentenced to 3 Years in Prison for Running Pill Mill

A former Florida psychiatrist was sentenced to 3 years in prison for illegally prescribing controlled substances and must forfeit more than $400,000 in cash and nine luxury vehicles, including a 2020 Porsche GT4 and a 2020 Aston Martin.

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According to the US Department of Justice, the US Drug Enforcement Administration began investigating Gerald Michael Abraham, 76, after receiving a tip that he was prescribing opioids to patients who did not need the medication. The investigation, which began in October 2019, included 18 visits by undercover patients to Abraham’s cash-only clinic in Naples, Florida. Patients paid $400 per visit, according to court documents.

Even though the undercover patients pretended to have signs of drug abuse, Abraham still prescribed oxycodone, a strong opioid, on each visit without any physical examination, according to officials. He repeatedly increased the strength of the prescriptions when the patients asked. In one case, he told a patient that the patient’s medical paperwork “shows you are completely normal,” then went ahead to prescribe the oxycodone.

Abraham also gave Adderall to patients who had no legitimate medical need for the drug. As with the opioid, Abraham prescribed the frequently abused amphetamine (typically used to treat attention-deficit/hyperactivity disorder) after being asked for it, without performing an examination or asking questions to justify the prescription, according to the undercover law enforcement agents.

According to the Florida Department of Health, Abraham voluntarily relinquished his license in September pending board action. His license was set to expire in January 2022.

Pennsylvania Physician Admits to Distributing Drugs Resulting in Patient’s Death

A Pennsylvania internist pleaded guilty to unlawful prescription of controlled substances, maintaining drug-involved premises, and healthcare fraud, as well as that the death of a patient resulted from the use of the controlled drugs.

When entering his plea, Kurt Moran, 69, acknowledged that the purpose of his Scranton-based pain management practice was to distribute high doses of opioids not for medical purposes, and that he often prescribed these drugs without examining the patient to verify the illness or condition the patient claimed to have. At times, he even prescribed the drugs without seeing the patient. He admitted that he knew that such practices could result in addiction and even death, according to federal officials.

The healthcare fraud charges resulted from a scheme that took place between 2014 and 2017 in which Moran received bribes in exchange for prescribing the drug Subsys (sublingual fentanyl), which is approved for use only in cancer patients who suffer from breakthrough pain. Court documents allege that Moran was paid approximately $140,000 over a 2-year period to prescribe Subsys to patients for whom the drug was not indicated.

In order to conceal the kickbacks and bribes, the company that paid Moran is alleged to have described the payments as honoraria for educational presentations about the drug. During that period, Moran prescribed millions of micrograms of the sublingual spray to patients with no cancer diagnosis.

Subsys is manufactured by Insys, a company whose founder and CEO, John Kapoor, was sentenced in 2019 to 5½ years in prison for his role in the bribery scheme involving Moran and other physicians.

Moran faces 12 years in prison. The maximum penalty for the crimes is 10 years for each charge. As a part of his plea deal, Moran agreed to forfeit $134,000. His license to practice medicine was suspended in October 2020 according to the Pennsylvania Bureau of Professional and Occupational Affairs.

Former Pharmaceutical Executive Charged With Embezzlement

The former owner and CEO of a New Jersey pharmaceutical company is accused of embezzling millions of dollars from his company by federal officials.

According to the charging documents, John Klein, 75, of Palisades Park, New Jersey, hired a chief financial officer in 2016 who then created a profit-and-loss statement showing the company’s sales and receivables. According to the CFO, Klein provided information that included an account receivable of approximately $3.9 million that had not been collected.

In December 2016 and January 2017, Klein approved a reserve against the uncollected receivable in the financial statements. However, back in May 2016, $3.9 million was transferred into a company bank account that Klein controlled. In a June 2016 email, Klein acknowledged that the invoices in question had been paid in full. A review of the company bank account showed that Klein used the money to pay personal debts, such as credit card payments, property taxes, and private-school tuition for his child.

Klein is the subject of several federal lawsuits from people who worked at Cambridge Therapeutic Technologies in Teaneck, New Jersey, as well as individuals he collected investment money from, according to media reports.

If convicted, Klein faces up to 20 years in prison and a fine of $250,000 or twice the gross profits or twice the gross loss suffered by the victims of the fraud, whichever is greatest.

Practice Administrator Sentenced for Defrauding Medical Practice

An Indiana man was sentenced to 30 months in federal prison for stealing from the ophthalmology practice where he worked for 5 years as a practice administrator.

Joshua D. Millspaugh, 42, of Westfield, Indiana, pled guilty to charges of wire fraud, according to federal officials.

Millspaugh, who earned an annual salary of over $100,000, was responsible for payroll processing, purchasing, and paying the practice’s bills. After less than a year on the job, he began taking advantage of his access to company money to use the practice’s funds for himself. During his 5 years of employment, he made over 500 such transactions, making purchases, paying personal bills, and sending payroll checks to his personal bank account. He concealed these transactions with false entries in the company’s bookkeeping system. When asked about expenditures, he made up false justifications.

During Millspaugh’s sentencing, William Whitson, MD, owner and director of the practice, Whitson Vision, told the court that the loss to him and the practice was about more than money. In addition to creating long-term credit and banking problems, the situation damaged both the company’s business reputation and the morale of its other employees.

“Fraud on a small business impacts every area of that business,” said US Attorney for the Southern District of Indiana Zachary A. Myers. “It also breeds mistrust, especially if the fraud is perpetrated by a trusted employee. Mr. Millspaugh exploited his position of trust for purely personal gain, and he is now being held accountable for his actions.”

In addition to the prison sentence, Millspaugh was ordered to pay $270,000 in restitution and will be federally supervised for 3 years following his release from prison.

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