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FORMER LITTLE ROCK DIAGNOSTIC CLINIC CEO PLEADS GUILTY TO OBTAINING HYDROCODONE BY FRAUD

December 18, 2012

Little Rock - Christopher R. Thyer, United States Attorney for the Eastern District of Arkansas, and William J. Bryant, Assistant Special Agent in Charge of the Little Rock Field Division of the Drug Enforcement Administration (DEA) announced the waiver of indictment and plea to a felony Information charging James Derek Johnston, age 42, of Hot Springs with one count of obtaining hydrocodone by fraud.

According to the felony information, James Derek Johnston knowingly and intentionally obtained hydrocodone, a Schedule III narcotic controlled substance, on or about February 8, 2012, when he caused a false prescription for the drug to be submitted to a pharmacy in his name and filled, when in fact, no such prescription had been issued or authorized by a physician with DEA prescribing authority.

At the hearing held today before United States District Judge Susan Webber Wright, the defendant admitted that in 2007, because of an injury, he began obtaining legitimate prescriptions for hydrocodone from a physician at Little Rock Diagnostic Clinic (LRDC), where Johnston was employed as the Chief Executive Officer. However, beginning in fall of 2008, and continuing until July 2012, Johnston caused a nurse employed by LRDC to either fax or call in prescriptions for hydrocodone to a number of drug stores in Little Rock, Arkansas. These prescriptions were written by the nurse in Johnston’s name without the knowledge or consent of the initial prescribing physician at LRDC. Johnston admitted that the nurse who wrote the fraudulent prescriptions was an employee whom he supervised. Johnston was released on bond and was ordered to submit to drug testing, treatment and counseling under the supervision of the United States Probation Office.

According to the factual summary offered by the Assistant United States Attorney at the hearing, between October of 2008 and July of 2012, Johnston filled over 150 prescriptions and received approximately 25,000 hydrocodone pills as a result of his fraud.

LRDC was fully cooperative with federal authorities in the investigation, and the investigation did not reveal any evidence that compromised any patient information or identities. Both Johnston, who is a Certified Public Accountant, and the nurse are no longer employed by Little Rock Diagnostic Clinic.

“According to the 2007 National Survey on Drug Use and Health, non-medical use of prescription drugs is higher than the abuse of cocaine, heroin and hallucinogens combined,” stated Thyer. “Together, with our investigative, law enforcement, treatment and awareness partnerships at all levels, I am committed to the role that the United States Attorney’s Office has in reducing this abuse wherever it occurs - in the streets or in the businesses where we work.”

In response to the guilty plea, ASAC Bryant stated, “Prescription drug abuse continues to be an emerging threat to the citizens of Arkansas. Prescription drug abuse does not discriminate and reaches all social economic levels of society. This investigation was conducted by the newly formed Tactical Diversion Squad at the DEA Little Rock District Office, whose main priority is to investigate individuals involved in the diversion of Prescription Drugs. The Tactical Diversion Squad is composed of DEA Special Agents, DEA Diversion Investigators, and Task Force Officers from the Little Rock Police Department and Jefferson County Sheriffs Office.”

Sentencing will be set at a later date to be determined by the Court. The maximum statutory penalty for obtaining a controlled substance by fraud is 4 years imprisonment, a fine of $250,000, and 1 year supervised release.

The investigation was conducted by the Drug Enforcement Administration, United States Secret Service, and the Little Rock Police Department. The case was prosecuted by Assistant United States Attorneys Patricia S. Harris and Kristin Bryant.

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Christopher R. Thyer

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