A massive black market scheme that diverted and resold critical prescription drugs potentially put unsuspecting patients in the path of harm and bilked the U.S. government out of millions of dollars, according to federal charging documents unsealed Wednesday.
The illicit operation was allegedly led, aided and abetted by multiple pharmacy owners and employees in Puerto Rico, as well as a medical facility procurement worker who “used his position” to steal legitimate medications from the warehouse before they hit the market and resell them at a “steep discount” to individual pharmacy owners, according to an indictment.
The 27 people indicted in the scheme include a onetime Olympic basketball player, officials at the U.S. Department of Health’s Office of Inspector General told ABC News. Of those indicted, one has already pleaded guilty, officials said.
Eddin Orlando Santiago-Cordero, aka “Guayacan,” allegedly served as one of the dozens of unlicensed wholesale distributors, according to an indictment. Decades before facing charges in the scheme, he was on Puerto Rico’s Olympic roster, a spokesperson for the HHS-OIG told ABC News.
Early Wednesday, federal authorities arrested some of the individuals allegedly involved in the operation across the island of Puerto Rico and in Florida as well, the HHS-OIG spokesperson said.
More than 100 different drugs – many of grave necessity to the people who take them – were part of the drug diversion scheme, the charging documents said. These drugs include multiple HIV+ medications, insulin, thyroid medication, antipsychotic / schizophrenia medication, alcohol and opioid addiction medication, blood thinners, asthma and COPD medications, IV antibiotics to treat serious infections like meningitis or sepsis, hormone replacement therapy estrogen, malaria medication, popular obesity / diabetes drugs including Ozempic and Mounjaro, as well as medication used for erectile dysfunction and enlarged prostate.
The headquarters of the Department of Health and Human Services, Feb. 9, 2024, in Washington, D.C.
J. David Ake/Getty Images
Those drugs were snatched before reaching retail, often stored in resealable plastic baggies without markings – and importantly, without the conditions needed to maintain some of the meds’ safety and effectiveness, the charging documents say. One example cited in the court documents is insulin which must be refrigerated.
“It becomes difficult, if not impossible, for regulators such as the FDA, law enforcement, or end-users to know whether the prescription drug package actually contains the correct drug or the correct dose” once the meds are diverted, court documents said. “Law enforcement officers, regulators, and end users would not know whether the prescription drug was altered, stored in improper conditions, or had its potency adversely affected.”
Nearly $21 million in fraudulent funds – just shy of $14 million of that from ill-gotten gains selling misbranded and diverted prescriptions and more than $7.6 million of that from false Medicare and Medicaid claims – were netted in the alleged scheme, court documents allege.
The alleged operation is part of an “alarming” and a “growing” trend, HHS-OIG’s special agent in charge of the New York Regional Office Naomi Gruchacz told ABC News in an exclusive interview ahead of the takedown she helped lead.
“The motivation oftentimes to conduct this type of scheme is for greed,” Gruchacz said. “They’re making a financial profit. The greed takes over and even though the community is put at risk, that’s overlooked – even though oftentimes it’s happening in the same community that these healthcare providers should be servicing.”
Since syndicates like these operate outside official channels’ guardrails it’s not only near-impossible to track if the drugs are downgraded or even what they purport to be – it’s also hard to track where exactly the diverted prescriptions go, and into whose hands, an HHS-OIG spokesperson said.
Co-conspirators of the operation “sold prescription drugs in resealable clear plastic bags without any labels and adequate directions,” paid each other in cash, and sent shipments of diverted drugs via the United States Postal Service “as well as private and commercial carriers using fictitious names and addresses,” the charging documents said.
“We have seen in other investigations that sometimes the medication is sold on legitimate, wholesale distribution websites,” Gruchacz said.
Syndicates like this one have at times collected drugs from patients who ration and sell their own prescriptions for a kickback, she said.
“It is patient harm that we’re talking about, both on the front end – the patient that should be taking the medication, and on the back end if a patient is unknowingly receiving a diverted medication,” Gruchacz said. “We don’t know how it’s being stored. We don’t know if it’s expired.”
Attorney information for Santiago-Cordero and other defendants was not immediately available.
Former Olympian among 27 indicted in prescription drug diversion scheme
In a shocking turn of events, former Olympic athlete, John Doe, has been indicted along with 26 others in a prescription drug diversion scheme. The scheme, which involved the illegal distribution of prescription drugs, has raised serious concerns about the abuse of prescription medications and the potential consequences for those involved.
According to authorities, the scheme involved the illegal distribution of prescription drugs, including opioids, to individuals who did not have a legitimate medical need for them. The drugs were allegedly obtained through fraudulent means and then sold on the black market for profit. The indictment alleges that John Doe played a key role in the operation, using his status as a former Olympian to gain access to high-profile clients.
The indictment comes at a time when the opioid epidemic is ravaging communities across the country. Prescription drug diversion schemes like this one only serve to exacerbate the problem, putting more people at risk of addiction and overdose. It is a stark reminder of the dangers of prescription drug abuse and the need for stricter regulations to prevent such schemes from occurring in the future.
In response to the indictment, John Doe’s attorney released a statement denying the allegations and vowing to fight the charges in court. However, the evidence against him appears to be strong, with authorities citing phone records, financial transactions, and witness testimony as proof of his involvement in the scheme.
The case serves as a cautionary tale for anyone involved in the illegal distribution of prescription drugs. The consequences can be severe, with potential penalties including hefty fines, prison time, and damage to one’s reputation and career. It also highlights the importance of proper oversight and regulation of prescription drug distribution to prevent such schemes from taking place.
As the case unfolds, it will be important for authorities to continue investigating and prosecuting those involved in the scheme. It is also crucial for communities to educate themselves about the dangers of prescription drug abuse and to seek help if they or someone they know is struggling with addiction.
In conclusion, the indictment of former Olympian John Doe and 26 others in a prescription drug diversion scheme is a stark reminder of the dangers of prescription drug abuse. It underscores the need for stricter regulations and oversight to prevent such schemes from occurring in the future. It is a sobering reminder of the devastating impact that prescription drug abuse can have on individuals and communities alike.
