Two Florida Pharmacies to Pay $7.4 Million to Resolve False Claims Act Allegations

Jacksonville’s Smart Pharmacy, Inc., SP2, LLC, and owner Gregory Balotin have agreed to pay at least $7.4 million to resolve lawsuits filed in Jacksonville, Florida, alleging they violated the False Claims Act by adding the antipsychotic drug aripiprazole to topical compounded pain creams to boost reimbursement and by routinely waiving patient copayment obligations, the U.S. Department of Justice (DOJ) announced.

DOJ said the settlement amount is based on the defendants’ ability to pay and the claims against the defendants are allegations only; there has been no determination of liability.

The lawsuits against the pharmacies were originally filed as whistleblower complaints by two former employees.

Aripiprazole, which is sold under the brand names Abilify, Abilify Maintena, and Aristada, is approved by the U.S. Food and Drug Administration to treat a number of psychological conditions such as schizophrenia and Tourette’s disorder. The government alleged that the defendants crushed aripiprazole pills approved for oral use and included them in compounded creams used topically for pain treatment, while knowing that there was not an adequate clinical basis to do so.

The defendants were alleged to have included the drug in the pain creams to increase their profits on prescriptions paid for by Medicare Part D and TRICARE, the federal health care program for active duty military personnel, retirees, and their families.

The government also alleged that the defendants improperly routinely waived patient copayments to induce patients to accept the pain cream prescriptions.

In connection with the settlement, DOJ said Gregory Balotin has agreed to enter into a three-year integrity agreement with the Department of Health and Human Services that includes an annual claims review by an independent review organization

“When pharmacies inflate their revenue with medically unsupported prescription ingredients, they compromise the quality of patient care and waste taxpayer dollars,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division.

Source: U.S. Department of Justice

Topics Florida Claims Numbers