Telemarketers pay $4 million to end case of soliciting patients and paying telemed docs for prescriptions for compounded drugs for kickbacks

Two telemarket company owners Jack Lee Stapleton and Jack Hunter Stapleton will pay $4 million to end allegations they engaging in schemes to generate prescriptions for compounded drugs and refer those prescriptions to pharmacies in exchange for illegal kickbacks. Many of those prescriptions were billed to TRICARE, the federal health care program providing insurance for active-duty military personnel, military retirees, and military dependents.

They operated companies including CV McDowell LLC, and J&J Tel Marketing LLC (the Stapleton Entities). The United States alleged that the Stapleton Entities, under the Stapletons’ direction, used telemarketing to solicit potential patients to accept compounded drugs even if they didn’t need them, then got prescriptions for those patients through telemedicine doctors, and sent those prescriptions to compounding pharmacies. Those pharmacies agreed to pay the Stapleton Entities half of the amount TRICARE reimbursed for each prescription. The Stapletons and Stapleton Entities worked with pharmacies to identify compounded drug formulas that paid the highest level of reimbursement for the drugs, regardless of the medical need for the chosen formula. They then sought to procure large volumes of prescriptions for those formulas. In many cases, the Stapleton Entities procured prescriptions by paying telemedicine providers who prescribed expensive compounded drugs without ever seeing the patients or conducting any meaningful medical examination.

The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Dwayne Thornton against the Stapletons. Under the qui tam provisions of the False Claims Act, a private party can file an action on behalf of the United States and receive a portion of the settlement if the government takes over the case and reaches a monetary agreement with the defendant. Thornton is a former employee of one of the pharmacies to which the Stapleton Entities referred prescriptions. The share to be awarded from this settlement has not yet been determined. The qui tam case is captioned United States ex rel. Thornton v. National Compounding Co. et al., Case No. 8:15-cv-2647 (M.D. Fla.).

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