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Press Release

Pentec Health, Inc. to Pay $17 Million to Settle False Claims Act Allegations

For Immediate Release
U.S. Attorney's Office, Eastern District of Pennsylvania

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Pentec Health, Inc. (“Pentec”) has agreed to pay the United States $17 million to settle allegations that Pentec submitted false claims to Medicare and other government healthcare programs.    

Headquartered in Glen Mills, Pennsylvania, Pentec furnishes a range of renal and specialized pharmacy compounding services, including the compounding of its drug, Proplete, and the provision of intradialytic parenteral nutrition (“IDPN”) and intraperitoneal nutrition (“IPN”) to individuals with end stage renal disease.

The United States alleges that from 2007 to 2018, Pentec billed Medicare and other federal healthcare programs for excessive amounts of product wasted during the compounding of Proplete, and Pentec routinely waived patient copayments and deductible obligations in order to induce the prescription and use of Proplete.  Pentec also submitted duplicate and improperly coded claims to the Federal Employee Health Benefits Program. 

Along with this Settlement, Pentec has also signed a Corporate Integrity Agreement (“CIA”) with the Department of Health and Human Services, Office of Inspector General (“HHS-OIG”) that will require regular monitoring of its billing practices for a period of five years.

“We are committed to ensuring that compounding pharmacies appropriately bill Medicare,” said U.S. Attorney McSwain.  “Pentec allegedly padded its bottom line through several improper means, including by charging the government for quantities of medication that its patients did not actually need or receive.  Those who engage in these practices will be held accountable.”

“Compounding pharmacies play an integral role in the delivery of quality health care services and are required to follow rules designed to protect patients and prevent the waste of taxpayer funds,” said Maureen Dixon, Special Agent in Charge of HHS-OIG in Philadelphia.  “We will continue to work closely with the United States Attorney’s Office to ensure the integrity of taxpayer funds.”

This settlement resolves a lawsuit filed under the False Claims Act (FCA) in the U.S. District Court for the Eastern District of Pennsylvania by Jean Brasher, a former employee of Pentec, under the qui tam or whistleblower provisions of the FCA, which permit private citizens to bring lawsuits on behalf of the United States and obtain a portion of the government’s recovery.  The FCA also permits the government to intervene and take over the lawsuit.  Ms. Brasher was represented by David Bocian, Esq. of Kessler Topaz Melzter & Check, LLP.

“We thank the relator for her invaluable contribution in this case. Together with her lawyers, they provided vital assistance to the government throughout this case. Without information from citizens like the relator, detecting fraud and conserving government program funds would be far more difficult,” said U.S Attorney McSwain.

The government’s resolution of this matter illustrates the government’s emphasis on combating health care fraud.  One of the most powerful tools in this effort is the False Claims Act.  Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).

The case was investigated by Assistant U.S. Attorney Jacqueline C. Romero of the U.S. Attorney’s Office for the Eastern District of Pennsylvania, with assistance from Health Care Fraud auditor George Niedzwicki, HHS-OIG, the United States Office of Personnel Management-Office of Inspector General, and the United States Department of Veterans Affairs-Office of Inspector General.

The case is captioned United States et al. ex rel. Jean Brasher v. Pentec Health, Inc.  No. 13-cv-05745 (E.D.Pa.).  The claims resolved by this settlement are allegations only and there has been no determination of liability

Updated February 8, 2019

Health Care Fraud