JACKSONVILLE, Fla. – A Jacksonville pharmacist and two pharmacies he owned have agreed to pay at least $7.4 million to settle a civil lawsuit filed by the U.S. Department of Justice.
The lawsuit alleged that the pharmacist and his businesses defrauded taxpayers by putting an antipsychotic drug into pain creams in order to get more money from insurance.
In the 2020 civil lawsuit, the U.S. government alleges Smart Pharmacy, SP2, and their owner, pharmacist Gregory Balotin, were routinely paid thousands of dollars for each one-month supply of pain cream given to patients.
Often the most expensive ingredient in these special-made creams, the government said, was Aripiprazole, an antipsychotic medication used to treat schizophrenia and Bipolar disorder. It’s more commonly known as Abilify, and there’s no evidence it provides topical pain relief.
Two lawsuits against the defendants were first brought by former employees of Smart Pharmacy. The government later got involved through the False Claims Act.
The government’s lawsuit against Balotin and his businesses said they received tens of millions of dollars for the creams containing the antipsychotic drug from Medicare Part D and TRICARE. TRICARE is the health insurance for military members, retirees and their families.
“It started with exposure of marketeers who were targeting TRICARE beneficiaries, military retirees, DOD beneficiaries, who enjoyed certain benefits. And as part of these benefits, had the option to pursue these exotic compounds,” said attorney John Holzbaur, who is not affiliated with the case. “These tailor-made treatments were very, very expensive.”
At the former location of SP2 on St. Johns Bluff Road, a new pharmacy has opened called “Injury Scripts.” Gregory Balotin is listed as co-owner and founder on its website.
News4JAX asked Holzbaur why criminal charges weren’t filed.
“Financial recovery is a principal goal here,” he said.
The settlement agreement says, “This Settlement Agreement is neither an admission of liability by Defendants, nor a concession by the United States that its claims are not well founded.”
In a press release, the government said the settlement amount was based on the defendant’s ability to pay.
They also said Balotin has agreed to enter into a three-year integrity agreement with a federal inspector general, which includes an annual claims review.
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