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Justice News

Department of Justice
U.S. Attorney’s Office
Northern District of Texas

Wednesday, October 29, 2014

Physician And Others Sentenced In “Pill Mill” Case

Nicolas Padron Ran “Cash Only” Padron Wellness Clinic In Dallas “Patients” Often Recruited From Homeless Shelters

DALLAS — A physician who ran a “cash only clinic” in Dallas that operated not as a legitimate medical facility, but as a place to unlawfully obtain controlled substances, and several coconspirators who operated as “dealers,” were sentenced this afternoon, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.

Nicolas Alfonso Padron, 55, of Garland, Texas, was sentenced by U.S. District Judge Barbara M. G. Lynn to 87 months in federal prison. He pleaded guilty in September 2013 to one count of conspiracy to unlawfully distribute a Schedule III controlled substance. Judge Lynn also ordered forfeiture on his house, two cars, a boat, and several bank accounts.

Dr. Padron and co-defendant Jose L. Martinez, 54, of Flower Mound, Texas, opened Padron Wellness Clinic (PWC), located at 1000 Emerald Isle Drive in Dallas in Fall 2010. PWC operated as a “pill mill,” or place to unlawfully obtain controlled substances, such as hydrocodone. Martinez was convicted at trial in February 2014 on one count of conspiracy to unlawfully distribute controlled substances and is awaiting sentencing. He faces a maximum statutory penalty of 10 years in federal prison, a $250,000 fine and restitution.

Today, other defendants who were convicted for their roles in the conspiracy were also sentenced:

Josephis Austin, 60, of Dallas was sentenced to 84 months;

Patricia A. Bryant, 60, of Dallas, was sentenced to 54 months;

Dennis J. Wade, 36, of Dallas, was sentenced to 21 months.

Austin and Bryant were each convicted at trial in February 2014 on one count of conspiracy to distribute controlled substances unlawfully. Wade and Allen C. Burkins, Jr., 43, of Dallas, each pleaded guilty earlier this year to the same offense. Burkins is scheduled to be sentenced on December 19, 2014.

All four were “dealers” who would recruit “patients,” often from homeless shelters, and drive them in groups to PWC. The dealers would typically escort the patients into the clinic, coordinate with Martinez, and pay cash for the office visits. Sometimes, Dr. Padron would see two or more patients at a time in the examination room. Patient visits were short and patients would normally leave with a 30-day prescription of 120 units (pills) of hydrocodone and 30-90 units of alprazolam. Dr. Padron diagnosed the majority of his patients with lower back pain and anxiety without regard to their true condition. For most of these patients, Dr. Padron did not prescribe or treat these “symptoms” with anything other than hydrocodone and alprazolam. Thus, the prescriptions were medically unnecessary and outside the scope of professional practice.

Once Dr. Padron issued the prescriptions, the coconspirator dealers would drive groups of patients to Urban Independent Pharmacy, located at 6300 Samuell Blvd., in Dallas, to get the prescriptions filled. Convicted co-conspirator and licensed pharmacist, Lisa Hollier, 44, of Sunnyvale, Texas, owned and operated that pharmacy. She was convicted at trial earlier this year on one count of conspiracy to distribute, unlawfully, a controlled substance and was sentenced in July 2014 to 60 months in federal prison.

At Urban Independent Pharmacy, Hollier had large amounts of hydrocodone and alprazolam in pre-filled bottles ready each day to handle the large group of dealers and their patients from PWC and other clinics. Dealers would furnish the money to pay for the narcotics, and at times, they paid Hollier directly for multiple patients’ prescriptions. After Hollier filled the prescriptions, the patients would give the dealers the pills, which they sold on the street for a profit.

Dr. Padron is currently serving a 57-month federal prison sentence following his guilty plea in September 2013, in a separate and unrelated case, to conspiracy to commit health care fraud. That conviction stems from his role as the medical director of A Medical House Calls, a physician house-call company that provided physician visits to Medicare beneficiaries in their homes, rather than in a doctor’s office. Dr. Padron was also ordered to pay nearly $9.5 million in restitution to the Centers for Medicare and Medicaid Services (CMS). Today’s sentence will run consecutive to that sentence, for a total sentence of 144 months in federal prison.

A total of 17 defendants have been convicted in this “pill mill” case. With today’s sentencings, all but two defendants, Martinez and Burkins, remain to be sentenced. A total of 14 “dealers” were convicted in the case.

The Dallas Health Care Fraud Prevention and Enforcement Action Team (HEAT) Strike Force, which includes the U.S. Department of Health and Human Services - Office of Inspector General (HHS-OIG), the FBI and the Texas Attorney General’s Medicaid Fraud Control Unit, investigated. Assistant U.S. Attorneys Kate Pfeifle and J. Nicholas Bunch prosecuted and Assistant U.S. Attorney John de la Garza is handling the forfeiture.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, the HHS’s CMS, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the HEAT Strike Force, see:

Updated October 14, 2018