Michael Schoenwald of Hollywood, Fla., has pleaded guilty before Judge Herman Weber in Cincinnati to one count of conspiracy to commit mail and wire fraud in connection with a drug diversion scheme in which he was involved, the Justice Department announced.
The government information alleged that Dr. Schoenwald purchased prescription Lupron, an injectable drug used to treat prostate cancer, at discount rates due to his status as a health care provider. Governing law prohibited Schoenwald from re-selling the drugs, and his agreement with the manufacturer provided that he would not do so.
Nevertheless, Schoenwald sold the Lupron to Gregory Pfizenmayer, who, in turn, sold the drugs to legitimate wholesalers in Ohio and elsewhere. Pfizenmayer sold the drugs accompanied by documents, required by law, that contained false information about the source of the drugs. A co-conspirator arranged the transactions between Schoenwald and Pfizenmayer. Pfizenmayer pleaded guilty to one charge of conspiracy to commit mail and wire fraud in February 2011 and awaits sentencing.
Schoenwald received compensation from Pfizenmayer for the prescription drugs through wire transfers, and in turn paid his co-conspirator a share of the profits. All told, Schoenwald, Pfizenm ayer and their co-conspirator sold over $1 million dollars worth of prescription drugs through this scheme.
“Diversion of prescription drugs casts doubt on the safety and quality of the medicines people rely on every day,” said Tony West, Assistant Attorney General for the Justice Department’s Civil Division. “As this criminal prosecution demonstrates, we are committed to fighting these diversion schemes so that our prescription drugs in the United States remain the safest in the world.”
The case is being prosecuted by Assistant U.S. Attorney Anne Porter of the Southern District of Ohio and Assistant Director Mark Josephs of the Justice Department’s Consumer Protection Branch. The investigation was conducted by the Food and Drug Administration, Office of Criminal Investigations and the U.S. Postal Inspection Service.