Pharmacy Owner Charged in Multimillion-Dollar Scheme to Commit Health Care Fraud and Pay Illegal Bribes to Doctor
NEWARK, N.J. – A Bergen County, New Jersey, man was arrested today for his role in conspiracies to commit health care fraud and to bribe a doctor, U.S. Attorney Craig Carpenito announced.
Eduard Shtindler, a/k/a “Eddy,” 36, of Paramus, New Jersey, is charged by complaint with one count of conspiracy to commit health care fraud and one count of conspiracy to pay illegal kickbacks to a doctor. He is scheduled to make his initial court appearance today before U.S. Magistrate Judge Leda Dunn Wettre in Newark federal court.
According to documents filed in this case and statements made in court:
From 2012 through at least 2017, Shtindler owned and operated Empire Pharmacy – now closed – in West New York, New Jersey. Starting in 2015, Empire began filling prescriptions for expensive specialty medication that required “prior authorization” before being approved for reimbursement by Medicare, Medicaid, and some private insurance providers. Shtindler intended to entice doctors to use Empire for specialty medication prescriptions by showing that, among other things, Empire received prior authorization approval more successfully than any other pharmacies. To do that, he directed Empire employees, including two pharmacists, to repeatedly falsify prior authorization forms for medications for various conditions, including psoriasis and Hepatitis C. In recorded conversations, Shtindler admitted to his and Empire’s practice of falsifying prior authorization forms in order to receive approval for medication that would not have otherwise been approved. Shtindler and Empire received approximately $2 million in reimbursement payments from Medicare, Medicaid, and other insurance carriers that they otherwise would not have received.
From 2012 through early 2017, Shtindler also participated in a conspiracy to pay bribes to a psychiatrist in Hudson County, New Jersey, to induce the doctor to send prescriptions to Empire. Shtindler sent Empire employees to deliver some of the bribe payments to the doctor. On occasion, Shtindler secreted cash bribes, in $100 denominations, in pill bottles that were delivered to the doctor. In exchange for these bribes, the doctor steered patients to Empire pharmacy, even though the patients used other pharmacies closer to their homes for all of their other prescriptions. In one recorded conversation between Shtindler and a former Empire employee who had delivered a bribe to the doctor on Shtindler’s behalf, Shtindler stated: “You think [the doctor]’s going to go to the FBI and rat himself out?” In another conversation with the same former employee, Shtindler said: “First off, I didn’t make you do it. I didn’t put a gun to your head. We all made money together.” Empire dispensed approximately $3 million in medications prescribed by the psychiatrist.
The count of conspiracy to commit health care fraud carries a maximum penalty of 10 years in prison. The count of conspiracy to pay illegal kickbacks carries a maximum penalty of five years in prison. Both counts are also punishable by a $250,000 fine, or twice the gross gain or loss from the offense.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; special agents of the Department of Health and Human Services-Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert; and the N.J. Office of the State Comptroller, under the direction of Comptroller Philip James Degnan, with the ongoing investigation leading to today’s arrest.
The government is represented by Assistant U.S. Attorney Joshua L. Haber of the Health Care and Government Fraud Unit of the U.S. Attorney’s Office in Newark.
The charges and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.