Dr. Kenneth D. Nahum, his oncology practice, and Ann Walsh, his wife and the practice manager, have agreed to pay the U.S. $1.7 million to resolve allegations of violating the False Claims Act. They stood accused of ordering drugs from a foreign distributor not approved to sell them in the U.S. and administering those drugs to their patients. The $1.7 million payment is restitution for claims they filed for allegedly using the counterfeit drugs on Medicare patients.
According to the U.S. Department of Justice, from April 1, 2010 until January 31, 2011, Walsh allegedly ordered chemotherapy drugs from a foreign distributor for use in the practice that had locations in Howell and Wall, NJ. In the June 28, 2012 letter from the U.S Food and Drug Administration (FDA) to Dr. Nahum’s practice, the multiple foreign distributors that Walsh ordered from were all subsidiaries of CanadaDrugs.com, the company behind the counterfeit Avastin scandal.
U.S. Assistant District Attorney Paul J. Fishman credited the investigative work of the FDA’s Office of Criminal Investigation and U.S. Department of Health and Human Services – Office of the Inspector General for making this settlement possible. After taking office, U.S. A.D.A. Fishman reorganized the health care fraud practice, in the process creating the Health Care and Government Fraud Unit. The unit handles criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, they have recovered over $1.32 billion in fraud settlements, judgments, fines, restitutions, and forfeiture.
A second similar case for a husband and wife in Tennessee just came to an agreement. Dr. Anindya Sen and Patricia Posey Sen agreed to pay $1.208 million to resolve allegations of violating the False Claims Act. According to the DOJ, the Sens purchased and administered unapproved drugs to patients and billed Medicare and TennCare, Tennessee’s Medicaid program, as if they were using FDA-approved drugs. The DOJ also alleged that the Sens purchased the drugs because they cost less than the FDA-approved drugs, therefore, using those drugs increased their profits
The claims settled by this agreement are only allegations, and the settlements are not a determination of liability