January 23, 2024
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The past and current owners of Pennmark Pharmacy in Philadelphia agreed to pay $4.65 million to resolve a federal fraud investigation. Prosecutors allege the pharmacy billed Medicare and Medicaid for higher-cost medications than those that were dispensed.
A South Street pharmacy will pay $4.65 million to resolve investigations into alleged health care fraud, prosecutors said Tuesday.
Federal attorneys alleged that the owners of Pennmark Pharmacy repeatedly billed Medicare and Medicaid for prescriptions that were never actually dispensed. They also billed Medicare for high-cost medications while dispensing cheaper options to actual customers, prosecutors claim.
The alleged crimes were committed over two time periods, under different management. The pharmacy's current owner, Jai Shri Krishna LLC, and its pharmacist Antim Patel will pay $3.95 million to resolve alleged violations of the False Claims Act committed between 2018 and 2020. The store's former owner, Pennmark Pharmacy Inc., separately will pay $700,530 to resolve alleged violations committed from 2015 through 2018.
Jai Shri Krishna LLC and Patel also must implement "substantial compliance" requirements and contract a third party to audit their Medicare claims and drug supplies, as part of an integrity agreement with the U.S. Department of Health and Human Services.
Since the claims have been settled, the owners bear no liability.
"Pharmacies and pharmacists are in a position to serve their communities as vital components of our medical system; they have a responsibility not to abuse their positions for profit," U.S. Attorney Jacqueline C. Romero said. "Taxpayers expect that their dollars will be spent on medications needed by Medicare and Medicaid beneficiaries. The U.S. Attorney's Office works every day to ensure that taxpayer dollars are not wasted on fraud and abuse."
State prosecutors resolved a similar case in Philadelphia last November. Ahmed Bachir, the owner of Aramingo Pharmacy in Port Richmond, pled guilty to billing Medicaid and other insurance providers more than $500,000 in phony prescriptions. He was ordered to pay $874,858 in penalties and restitution, and his pharmacist license was suspended for five years.
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