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Press Release

Former Sales Representative Sentenced to Five Years in Prison for Compound Prescription Drug Scheme

For Immediate Release
U.S. Attorney's Office, District of New Jersey

NEWARK, N.J. – A former sales representative was sentenced to 60 months in prison for his role in a scheme to defraud public health benefits programs by billing for medically unnecessary compound prescriptions, U.S. Attorney Philip R. Sellinger announced today. 

Matthew Puccio, 41, of Randolph, New Jersey, was convicted on July 19, 2022, of conspiracy to commit health care fraud following a seven-day jury trial before U.S. District Judge John Michael Vazquez, who imposed the sentence today in Newark federal court.

According to documents in this case and the evidence at trial:

Compound medications are specialty medications mixed by a pharmacist to meet the specific medical needs of an individual patient. Although compound drugs are not approved by the Food and Drug Administration (FDA), they are properly prescribed when a physician determines that an FDA-approved medication does not meet the health needs of a particular patient, such as if a patient is allergic to a dye or other ingredients in the prescription.

From November 2014 to March 2016, Puccio participated in a conspiracy that involved submitting fraudulent prescriptions for compound medications to public health benefits programs. Marketing companies recruited and paid sales representatives, such as Puccio, to obtain compound medications for themselves and others regardless of medical necessity, targeting health plans that reimbursed for compound medications at high rates.

Puccio exploited this opportunity through working as a sales representative for several compounding pharmacies. He targeted individuals who had health plans that covered compound medications and then convinced those individuals to obtain prescriptions for compound medications, regardless of medical necessity. Puccio and others induced two New Jersey-based physicians to sign medically unnecessary prescriptions for beneficiaries that Puccio and others had recruited.

Once the prescriptions were written, they were filled by the compounding pharmacies with which Puccio worked. The compounding pharmacies would then receive reimbursement from the health plans and would pay Puccio a percentage of the reimbursement amount. Puccio and his conspirators caused a significant loss to public health benefits programs.  

In addition to the prison term, Judge Vazquez sentenced Puccio to three years of supervised release and ordered him to pay $2.65 million in restitution.

U.S. Attorney Sellinger credited special agents of the FBI, Newark Division, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to the sentencing.

The government is represented by Assistant U.S. Attorneys Emma Spiro and Shawn Barnes of the Criminal Division in Newark.

Updated June 30, 2023

Health Care Fraud
Press Release Number: 23-192