Massachusetts

June 24, 2010

Anesthesiologist Sentenced On Health Care Fraud Charge (U.S. Attorney for the District of Massachusetts)

Massachusetts - The former chief of the acute pain clinic at Bay State Hospital in Springfield, Massachusetts was sentenced on June 24, 2010, in federal court for health care fraud. United States Attorney Carmen M. Ortiz; Mark Dragonetti, Special Agent in Charge of the Food & Drug Administration - Office of Criminal Investigations; Susan J. Waddell, Special Agent in Charge of Health and Human Services, Office of the Inspector General - Office of Investigations; and James C. Burrell, Acting Special Agent in Charge of the Federal Bureau of Investigation – Boston Field Division, announced today that Scott Reuben, 51, of Longmeadow, was sentenced by U.S. District Judge Ponsor to six months imprisonment to be followed by three years of supervised release, a $5,000 fine, restitution of $361,932 and forfeiture of $50,000. Reuben pleaded guilty to engaging in health care fraud on February 22, 2010.

At the earlier plea hearing, the prosecutor told the Court that had the case proceeded to trial the Government’s evidence would have proven that Reuben obtained research grants from pharmaceutical companies for the purpose of performing research on pain management, including one from Pfizer in 2005 regarding the use of multi-modal analgesia for patients having and recovering from anterior cruciate ligament reconstruction surgery. Despite entering into contracts by which pharmaceutical companies funded his research and provided free drug for the studies, Reuben did not actually perform certain studies, including one funded by Pfizer on the topic of “Perioperative Administration of Celecoxib as a Component of Multimodal Analgesia for Outpatient Anterior Cruciate Ligament Reconstruction Surgery.” However, Reuben caused medical journals, including Anesthesia and Analgesia to publish articles touting his multi-modal analgesia therapy despite knowing that he had falsified the research.

The case was investigated by the Food & Drug Administration - Office of Criminal Investigations, Health and Human Services, Office of the Inspector General - Office of Investigations and the Federal Bureau of Investigation. It is being prosecuted by Assistant U.S. Attorney Jeremy Sternberg of Ortiz’s Health Care Fraud Unit.

March 3, 2010

Former Beth Israel Medical Center Employee Pleads Guilty to Embezzling Over $1 Million Dollars (U.S. Attorney for the District of Massachusetts)

BOSTON, - A Boston man pled guilty today in federal court of embezzling over $1 million from Beth Israel Deaconess Medical Center.

United States Attorney Carmen M. Ortiz, Warren T. Bamford, Special Agent in Charge of the Federal Bureau of Investigation – Boston Field Division and Police Commissioner Edward Davis of the Boston Police Department announced on March 3, 2010 that Richard P. Webb, age 42, of Boston, pled guilty before U.S. District Judge Joseph L. Tauro to one count of health care theft and embezzlement.

At the plea hearing, the prosecutor told the Court that had the case proceeded to trial the Government’s evidence would have proven that Webb worked at Beth Israel Deaconess Medical Center, a teaching hospital of Harvard Medical School in Boston, as a practice assistant in the Ear, Nose, and Throat Department and from January 2006 through April 2009, and took approximately $1,054,712 by stealing checks written to the department and by obtaining fraudulent refunds for hearing aids and other items. To carry out the scheme, Webb forged signatures and deposited stolen funds into bank accounts that he controlled.

In an Agreement filed separately in Court, Webb and the Government agreed to recommend a sentence of 42 months of imprisonment, restitution and forfeiture of over $1 million, and a condition that he not handle money, investments, or other assents for other people or companies during his supervised release. Judge Tauro is expected to decide whether to accept the recommendation at the Sentencing Hearing set for June 9, 2010.

The case was investigated by the Federal Bureau of Investigation and the Boston Police Department. It is being prosecuted by Assistant U.S. Attorneys Scott L. Garland of Ortiz’s Computer Crimes Unit and Veronica Lei of Ortiz’s Asset Forfeiture Unit.

January 14, 2010

Springfield Anesthesiologist Charged with Falsifying Medical Research (U.S. Attorney for the District of Massachusetts)

BOSTON, MA - The former chief of acute pain at Bay State Hospital in Springfield,

Massachusetts was charged on January 14, 2010, in federal court with falsifying medical research studies, including studies that were published in medical journals regarding pain management. United States Attorney Carmen M. Ortiz; Mark Dragonetti, Resident Agent in Charge of the Food & Drug Administration - Office of Criminal Investigations; Susan J. Waddell, Special Agent in Charge of Health and Human Services, Office of the Inspector General; and Warren T. Bamford, Special Agent in Charge of the Federal Bureau of Investigation - Boston Field Division, announced today that Scott Reuben was charged in an Information with one count of health care fraud.

The Information alleges that Reuben solicited and obtained research grants from

Pharmaceutical companies to perform research studies on pain management, often associated with various surgical procedures, but that he did not actually perform the research studies. Instead he made up patient data, submitted it to medical journals and caused false articles to appear in a number of medical journals.

If convicted on this charge, Reuben faces up to 10 years imprisonment, to be followed by 3 years of supervised release and a $250,000 fine. The case was investigated by the Food & Drug Administration - Office of Criminal Investigations, Health and Human Services, Office of the Inspector General and the Federal Bureau of Investigation. It is being prosecuted by Assistant U.S. Attorney Jeremy Sternberg of Ortiz’s Health Care Fraud Unit.

August 1, 2009

Massachusetts Resident Sentenced For Nationwide Internet Prescription Drug Scheme (U.S. Attorney for the District of New Hampshire)

CONCORD, N.H. - Today, Christopher Chase, age 27, of Lynn, Mass., was sentenced to 42 months imprisonment and three years of supervised release during a hearing before U.S. District Judge Paul J. Barbadoro.

On Feb. 25, 2009, Chase entered a plea of guilty to a two count indictment charging him and two co-defendants with conspiracy and money laundering. The indictment alleged that the defendant conspired to smuggle and illegally distribute anabolic steroids, human growth hormone (HGH), insulin-like growth factor (IGF-1), and clenbuterol. The indictment also alleged that Chase laundered money by sending it to various foreign countries including China and Moldova.

The substances alleged in the indictment are illegal prescription drugs which were manufactured abroad, primarily in China, as well as other foreign countries. HGH and IGF-1 are injectable drugs and some forms of the anabolic steroids were also injectable.

The indictment alleged Chase and two co-defendants illegally imported the aforementioned prescription drugs and introduced them into interstate commerce without the prescription of a licensed medical doctor or other licensed medical professional.

Many of the packages which were shipped into the United States contained the prescription drugs but falsely declared that the packages contained test tube samples, mold samples, glass samples, measuring cups and glassware. The prescription drugs did not bear adequate directions for use in that the labeling did not contain directions under which a layperson could use the drugs safely and for their intended uses.

All of the drugs sold by the defendant were sold without a prescription and were nevertheless distributed despite the obvious dangers associated with unsupervised use of prescription drugs. Moreover, none of the drugs were approved by the Food and Drug Administration as safe or effective for body-building, the use for which the defendant marketed the drugs. Anabolic steroids are Schedule III controlled substances and are not FDA-approved for body-building. HGH is not approved by the FDA for body-building and may only be lawfully distributed for the treatment of disease or other recognized medical conditions as authorized by the FDA. Clenbuterol is not approved by the FDA for any use in humans, and IGF is not approved by FDA for any adult use. The defendant nevertheless sold these drugs to customers throughout the United States for a use for which the drugs had not been determined by the FDA to be safe and effective.

Moreover, the defendant obtained the drugs from foreign sources with no assurance that the drugs were manufactured under sanitary conditions or that the drugs were what they were purported to be. The FDA approval process is not limited to a clinical review; it includes a review of the manufacturing process and the drug's chemical composition, labeling, and packaging. The drugs sold by the defendant originated in countries such as China, Turkey, Poland, and Romania and were not subject to the FDA's comprehensive review. Thus, the defendant not only sold the prescription drugs to customers who lacked a prescription and for a use not approved by the FDA, he sold drugs manufactured and packaged under unknown conditions.

Once the prescription drugs entered the United States, they were distributed over the internet through websites and customers paid for the prescription drugs using credit cards and cash payments sent through the mail or by Western Union, MoneyGram, Pay Pal and PayByCheck. Most of the prescription drugs were paid for by credit card from customers in New Hampshire and throughout the United States. To enable the customers to pay for the illegally distributed prescription drugs, defendant Chase obtained 20 merchant accounts in his own name and also in the names of the other participants in the scheme. Between December 1, 2005, and September 30, 2006, Chase mailed approximately 520 packages within the United States and abroad.

Chase represented to the banks that the merchant bank accounts were intended for legitimate merchandise rather than for the illegal sale of prescription drugs. In this regard, Chase created decoy websites that falsely purported to sell legitimate merchandise and provided the names of these decoy websites to some of the banks. Chase used the merchant bank accounts to sell the prescription drugs through websites that were not disclosed to the banks.

Using the merchant bank accounts, credit card sales in the amount of approximately $671,465 were processed and electronically transferred to eleven bank accounts belonging to Chase and other participants in the scheme. Thereafter, approximately $549,047 was withdrawn, $425,890 of which was wire transferred overseas at Chase’s direction. The aforementioned totals do not include the revenues that Chase generated from selling anabolic steroids in the United States, an amount that remains undetermined.