Pharmacist and Two Pharmacies to Pay $1 Million False Claims Act Settlement

Michigan-based pharmacist Riad Zahr and two specialty pharmacies that he previously owned have agreed to pay the U.S. $1 million to resolve allegations of false claims for an anti-overdose drug, informed the US Department of Justice (DOJ) in their press release on Dec. 8, 2021.

The civil settlement came as a result of the allegations presented by the whistleblower, who is awarded $200,000 of the government’s recovery as part of the settlement.

Medicare whistleblower lawyers at Khurana Law Firm, P.C. support reporting abuse in the healthcare industry and encourage anyone with non-public information regarding medical system violations to help expose the fraud.

What Alleged Violations did Mr. Zahr Commit?

The DOJ alleged that Plymouth Towne Care Pharmacy dba People’s Drug Store (People’s Drug Store) and Shaska Pharmacy LLC dba Ray’s Drugs (Ray’s Drugs) submitted false claims for the drug Evzio to Medicare between August 1, 2017 and June 30, 2019.

Evzio (naloxone hydrochloride injection) was the highest-priced version of naloxone drug on the market used to reverse opioid overdose. Due to its price, the insurance companies are required to submit prior authorization requests before approving to cover for Evzio.

“The government alleged that People’s Drug Store and Ray’s Drugs submitted false and misleading prior authorization requests for Evzio that contained clinical assertions for which the pharmacies lacked any factual basis,” the press release states.

The $1 million settlement resolves DOJ claimed that Mr. Zahr and the two pharmacies initiated Evzio prescriptions based on rudimentary patient lists with only basic biographical details.

What is the Whistleblower’s role in Mr. Zahr Case?

The allegations resolved by the civil settlement were initially brought up under qui tam or whistleblower provisions of the False Claims Act by the whistleblower Rebecca Socol. Mrs. Socol, who formerly worked for kaléo Inc., the manufacturer of Evzio, will receive $200,000 of the settlement amount for her involvement and the provided information which led to the case.

In Nov., 2021, Mrs. Socol received $2,548,600 when kaléo Inc. made a $12.7 million settlement with the DOJ, which resolved the allegations that the company “caused the submission of false claims” for Evzio.

What is the DOJ’s Stand in the Riad Zahr Case?

“Taxpayers pay a huge amount of money for federal health care programs, and they expect that money will be spent honestly and effectively,” said Acting U.S. Attorney Nathaniel R. Mendell for the District of Massachusetts commenting on the settlement in Mr. Zahr’s case. “Our job is to find and stop misconduct like this, which hurts those programs and cheats us all.”

Whistleblowers are the government’s first line of defense in the fight against fraud in the healthcare industry when it comes to Medicare. If you have the information that can help defraud the Medicare program, you may be able to act as a whistleblower.

The national whistleblower attorney Arvind Bob Khurana helps people to build a strong case that helps whistleblowers receive a reward for aiding the government to fight fraud. Contact us today for a consultation. For a free, confidential evaluation call (888) 335-5107