Drug kickback scheme leads to lawsuit in Macon. Drug wholesaler agrees to pay $1.5M
A drug wholesaler has agreed to pay $1.5 million to settle a kickback scheme lawsuit brought against them in a Macon federal court, the Department of Justice announced Monday.
The lawsuit accused Arkansas-based drug wholesaler BTW Solutions, LLC, of offering pain cream at a cost “far lower than their fair market value” and later billing the Department of Labor’s Office of Workers’ Compensation Program “an exorbitant markup” from 2013 to 2018, which violated the Anti-Kickback Statute and the False Claims Act.
The company took its reimbursement and split it with physicians, the DOJ said. Some of the doctors involved were in the Macon area, which led to the case being filed in Macon.
The settlement marked the end of a years-long investigation, the DOJ said, in which the drug wholesaler cooperated.
While federal investigators eventually stepped in, the lawsuit against BTW was originally filed by Elizabeth Peters Young in 2017, who talked with a representative of BTW Solutions who wanted to hire her to work for the company in Florida. During the conversations with the representative, they revealed that “BTW provides topical creams and patches at cost,” according to Peters’ lawsuit.
Young, who has experience in pharmaceutical sales and claims processing, sparked an independent investigation against the drug wholesaler. Her investigation uncovered that BTW sold a bottle of Lidopro for $35 and sold a box of five Medrox patches for $23. The company then requested reimbursement claims that rose “as high as $852 for two four-ounce bottles of Lidopro and $870 for six five-patch boxes of Medrox,” according to the lawsuit.
The company and some doctors who agreed to the alleged scheme would equally divide the payment, and sales representatives would get a $30 commission, according to the lawsuit.
The U.S. intervened in the lawsuit in 2023. The government’s reason for jumping into the case was that “taxpayer funds were and are being paid to Defendants as a result of the false claims alleged in this complaint.”
“I am proud of our office’s efforts litigating this unique and difficult case involving an often-overlooked program designed to provide needed healthcare to injured federal workers,” said U.S. Attorney Peter D. Leary.
