Former CFO, President Plead Guilty In $35M Scheme At Passaic Co. Pharmacy

CLIFTON, NJ — Two more people involved with a Passaic County pharmacy have pleaded guilty to federal charges in connection with a $35 million scheme.

Jeffrey Andrews, 73, and Adam Brosius, 59, are two of four Pennsylvania residents charged with running a "massive" compounded medication fraud and kickback scheme from 2014 to 2016, according to the U.S. Attorney's Office in New Jersey. Officials said they operated under Main Avenue Pharmacy, a mail-order service with a storefront in Clifton.

According to court documents, Brosius was the former director of business development at the pharmacy before becoming president, and Andrews was the Chief Financial Officer for the pharmacy and its parent company. Both admitted to one count of conspiracy to violate the Anti-Kickback Statute in federal court this week, and Brosius also pleaded guilty to conspiracy to commit health care fraud, U.S. Attorney Philip R. Sellinger said Wednesday.

The scheme revolved around compounded drugs such as scar creams, pain creams, migraine medication, and vitamins, officials said. Physicians prescribe compounded drugs when an FDA-approved drug doesn't meet the health needs of a particular patient.

Robert Schneiderman, 81, of Langhorne, Pennsylvania, previously pleaded guilty to two counts of the indictment. Charges remain pending against Chad Beene, 52, of Philadelphia.

Another man, Anderson Triggs, was charged in a separate indictment and has also pleaded guilty.

Details Of The Conspiracy

The conspirators at Main Avenue Pharmacy identified compounded drugs that would yield "exorbitant reimbursements" from health insurers, including both federal and commercial payers, Sellinger's office said.

Main Avenue Pharmacy received more than $34 million in reimbursements from health care benefit programs, approximately $8 million of which was paid by federal payers, according to court documents.

The physicians who signed prescriptions for compounded medications that were filled at Main Avenue frequently had never even spoken to the patients or examined them, according to court documents.

Once the prescriptions were signed by a doctor, they would get returned to the marketing company, which would transmit the prescription to Main Avenue Pharmacy, authorities said. Then the pharmacy would fill them and submit claims to health care benefits programs for reimbursement, according to officials.

Sentencing for both Brosius and Andrews has been scheduled for Feb. 2025.

The count of conspiracy to commit health care fraud is punishable by a maximum penalty of 10 years in prison, while the count of conspiracy to violate the Anti-Kickback Statute is punishable by a maximum penalty of five years in prison, Sellinger said. Both counts are also punishable by a fine of $250,000 or twice the gross gain or loss from the offense, whichever is greatest.