Pharmacy Owner Pleads Guilty to $8.3M Fraud Scheme

A Fort Lauderdale man who invested in three pharmacies that participated in the Medicare program pleaded guilty to taking part in an $8.3 million fraud scheme.

According to court documents, Michael Murphy, 37, invested in Cure Pharmacy in Jacksonville and two other pharmacies. From around November 2019 until March 2021, he and his co-conspirators engaged in a scheme in which pharmacy owners paid kickbacks and bribes to telemarketers and telemedicine providers to secure orders for medically unnecessary prescriptions. The prescriptions were mostly topical creams including antipsoriatic medications, antifungal drugs, and pain medicines, which had a relatively high rate of reimbursement from Medicare.

The telemedicine companies employed or contracted physicians who signed the prescriptions. They had no physician-patient relationship with the beneficiaries and typically signed the prescriptions after a quick telephone conversation with the beneficiary or with no contact at all.

According to a criminal filing against one of Murphy’s alleged co-conspirators, did not attempt to collect pharmacy copayments for the false and fraudulent prescriptions in order to induce the Medicare beneficiaries to receive and not return these unnecessary medications.

The claims were sometimes submitted through multiple pharmacies Murphy and his co-conspirators owned and controlled in a practice known as “recycling,†and were reimbursed $8.3 million by Medicare Part D.

According to corporate records, Murphy had been operating Cure Pharmacy since October 2012. The organization is now listed as inactive.

He faces up to ten years in prison when he is sentenced at a later date.

In recent years, investigators have gone after a number of different pharmacy and telemedicine fraud schemes. Earlier this year a pharmacy owner and his co-conspirators were sentenced in a $174 million telemedicine pharmacy fraud scheme.

In June 2020, four Florida pharmacy owners were indicted for their alleged participation in a $54 million compound pharmacy kickback scheme.

The Health Law Offices of Anthony C. Vitale stand ready to assist those who find themselves swept up into the government’s intensified efforts in the healthcare fraud arena. Our firm represents healthcare professionals in state and federal court who are charged with fraudulent billing, kickbacks, Medicare, Part D and Medicaid fraud and false claims, among others. Our team of highly skilled attorneys and consultants are here to help you before you become the focus of an investigation and will aggressively defend you should you become the target of one.

For more information you can contact us at 305-358-4500 or send us an email to info@vitalehealthlaw.com and let’s discuss how we might be able to assist you.