Georgia Pharmacy Slammed With $4.6M False Claims Settlement

SMYRNA, GA — A pharmacy with locations in Smyrna and St. Petersburg, Florida agreed to pay $4.6 million in a settlement to resolve allegations that it violated the False Claims Act by charging the government far higher prices than the "usual and customary" prices charged to other patients, the U.S. Department of Justice said.

Curant Health Georgia, LLC and Curant Health Florida, LLC — owned by Patrick Dunham, Scott Zepp, Marc O'Connor and Pankajkumar Patel — sold compound pain creams and scar creams to TRICARE beneficiaries. TRICARE provides health insurance to members of the military and their families.

To keep costs down, TRICARE prohibits pharmacies from charging more than their "usual and customary" price, which is defined as the retail price of the medication in a cash transaction, according to a DOJ news release.

Despite this prohibition, the government claims that between 2013 and 2015, Curant charged TRICARE a much higher price for its compound creams than it offered to its cash-paying patients. The government further claims that during that same time period, Curant also did the following:

• Paid kickbacks to a third-party marketer to arrange for doctors to send prescriptions to it.
• Waived patient copayments in an effort to drive up its sales.
• Submitted claims to TRICARE for compound creams that were not medically necessary.
• Failed to return overpayments that it received from TRICARE once it learned of them.

“Pharmacies cannot overcharge government healthcare programs while offering cheaper prices to others, in violation of their payor agreements,” Acting U.S. Attorney Kurt Erskine said. “Such actions undermine efforts to protect government healthcare plans and keep costs lower.”

The civil settlement resolves a lawsuit filed in the U.S. District Court for the Northern District of Georgia by Dennis Long, a former pharmacist at Curant's Smyrna location. Long filed the lawsuit under the qui tam, or whistleblower provisions, of the False Claims Act. Under this act, private citizens may bring suit for false claims on behalf of the U.S. and share in any recovery obtained by the government, the news release said.

Long will receive $805,000 from the settlement, and Curant also has to pay his attorney's fees.

"The claims resolved by the settlement are allegations only, and there has been no determination of liability," the release said.

“This settlement serves as a warning to those companies and individuals who seek to take advantage of the Department of Defense (DoD) health care program,” DoD Special Agent in Charge Cynthia A. Bruce said. “[Defense Criminal Investigative Service] and our investigative partners are committed to fully investigating allegations of fraud, waste and abuse which jeopardize our military families’ precious healthcare resources.”