A bitter pill: Pharmacy owner punished for repackaging and reselling drugs

Blue Cross Blue Shield of Michigan’s Corporate and Financial Investigations Department assisted the FBI and Drug Enforcement Administration with an investigation of a pharmacy in the Grand Rapids area.

Confidential tips led investigators to a pharmacy that was restocking drugs returned from nursing homes and adult foster care facilities. These drugs were placed back on the shelves and stored in stock bottles and other containers. As a result, the pharmacy didn’t maintain accurate lot numbers and expiration dates for the drugs.  

When patients at nursing homes and adult foster care facilities no longer needed their medication, pharmacy employees would pick up the old drugs when they delivered new ones. The nursing homes and adult foster care facilities were told that the drugs would be destroyed.

Instead, pharmacy employees removed the drugs from their packaging and repackaged them for redistribution. This would separate the drugs from their lot numbers and create cross-contamination issues, in violation of both state and federal laws. 

Judge Charles E. Chamberlain of the U.S. District Court for the Western District of Michigan ordered restitution in the amount of $8,820,708.50. Of this amount, Blue Cross’ restitution payment was $475,083.   

The owner of the pharmacy was sentenced to the Federal Bureau of Prisons for a term of 120 months.  

We urge Blue Cross and Blue Care Network members who suspect health care fraud to call our Anti-Fraud Hotline at 1-800-482-3787.