Pharmacist Sentenced to Prison for Scamming Health Programs

April 4, 2015
Meghan Ross, Associate Editor

A New York pharmacist was sentenced to 3 years in prison and will have to pay more than $7 million in restitution for his scheme to defraud Medicare, Medicaid, and an AIDS program.

A New York pharmacist was sentenced to 3 years in prison and will have to pay more than $7 million in restitution for his scheme to defraud Medicare, Medicaid, and an AIDS program.

Purna Chandra Aramalla owned and operated A Fair Deal Pharmacy, Inc, in Queens, New York. Despite the claim of his pharmacy’s name, Aramalla was not offering a fair deal to his customers and the health care system.

According to the US attorney’s office, Aramalla illegally diverted prescription drugs, including HIV medications. In addition to scheming Medicare and Medicaid, he also defrauded the state-funded AIDS Drug Assistance Program (ADAP).

Aramalla bought prescriptions drugs from patients who wanted to sell their medication instead of using it to treat their illness. Then, the pharmacist would repackage and resell the drugs to other customers. Medicare, Medicaid, and ADAP reimbursed Aramalla for these illegally obtained drugs, according to the US attorney’s office.

The pharmacist would also dissolve the adhesive on the prescription bottles’ labels with lighter fluid so that he could replace them with new ones in an effort to make the drugs appear to have come from legitimate sources.

Aramalla received reimbursement for drugs that were never dispensed to patients. Customers sold their prescriptions to Aramalla, who would then provide them with some money from the reimbursements.

According to the US Attorney’s Office, Aramalla’s pharmacies obtained more than $10 million in reimbursements that could not have been for Aramalla’s purchases from legitimate wholesalers.

The pharmacist was also sentenced for tax evasion.

“Purna Aramalla’s prescription drug diversion scheme defrauded millions of dollars from programs established to provide health care assistance for the elderly and indigent,” Manhattan US Attorney Preet Bharara said in a press release. “The scheme also jeopardized the health of anyone induced to sell his or her prescription or medication, and anyone who unwittingly purchased repackaged drugs.”