Wholesale Pharmaceutical Provider Recycled $100 Million of Black Market Drugs

Pharmaceutical Industry

The owner and operator of a Utah wholesale pharmaceutical distributor has been found to have utilized the black market to reap over $16 million in illicit profits during his two-year scheme. The ploy was conceived and executed through his company, Green Valley Medical Distributors LLC, a supposed intermediary between pharmaceutical manufacturers and pharmacies. In reality, Green Valley was purchasing the majority of their drugs through the black market and redistributing them without informing purchasers of their true origin. This practice allowed them to receive millions in undue Medicare reimbursements, oftentimes at rates 200% higher than the price at which they were purchased.

Green Valley mainly focused their attention on high-cost drugs, such as those used to treat HIV/AIDS, utilizing a nationwide black market to purchase secondhand drugs at heavily discounted rates. The source of the medications were most often low-income Medicare beneficiaries who paid little to nothing for their prescriptions. These individuals would then be propositioned to trade their medication for cash, usually as little as $40 or $50 per bottle. The paying party would perform hundreds of these trades before sending them to Green Valley, generally packaged improperly in unmarked cardboard boxes. Oftentimes, these packages contained pill bottles with patient labels still affixed or that were otherwise damaged – sometimes even containing the wrong medication. Green Valley’s operator would weed out the conspicuous bottles and repackage them to perpetuate the illusion that the drugs were lawfully obtained, before passing them on to unsuspecting pharmacies across the nation.

The true source of the medication was masked by Green Valley’s deliberate falsification of “pedigrees,” or documents that certified their legitimacy, many of which claimed they were purchased directly from the manufacturer. Blind to the scheme afoot, the purchasing pharmacies would pay Green Valley the retail price for the medications and, in turn, sell them to customers. This is where the deception becomes egregious: by failing to disclose the true nature of the drugs, customers were ingesting potentially dangerous substances that were highly susceptible to tampering. Additionally, Green Valley would regularly use lighter fluid to clean patient labels off the bottles and make them appear as new. The chemicals within such an agent could easily have penetrated the bottle and tainted the medication within, endangering the customer even further.

This disregard for patient health is far from uncommon in cases of healthcare fraud, but Green Valley’s blatant victimization of two separate groups of people sets a new standard for immorality. On one end, their sources prey on low-income beneficiaries and encourage them to forego their necessary medical treatment in exchange for cash, an offer that is hard to turn down for those in need. The deliberate steps then taken to obscure their indiscretions and market the drugs as certifiably safe endangers yet another group of individuals, whose suffering is also taken advantage of – solely for the purpose of lining the pockets of Green Valley’s proprietors.

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If you have meaningful information regarding pharmaceutical fraud that you believe is in violation of the False Claims Act, Whistleblower Justice Network can help. Working alongside world-class legal counsel, we will ensure you are protected to the fullest extent of the law and that you receive credit for the information you bring to the U.S. government. Partnering with whistleblowers is all we do. Visit us at www.whistleblowerjustice.net, or call us at 844-WJN-4ALL.

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