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Press Realease Header of the Attorney General of Connecticut

09/11/2018

State Sues Florida-Based Compound Pharmacy, Former and Current State Employees, Alleging Illegal Kickback Scheme

State False Claims Act lawsuit seeks civil penalties, treble damages, for alleged illegal conduct


The state has initiated a lawsuit alleging violations of the Connecticut False Claims Act orchestrated through a kickback pyramid scheme involving a Florida-based compounding pharmacy and several individuals, including former and current Connecticut state employees, whose prescription drug costs are covered by the taxpayer-funded Connecticut Pharmacy Benefit Plan, Attorney General George Jepsen said today.

The state alleges that Assured Rx, a Florida compounding pharmacy that holds a non-resident pharmacy license in Connecticut, conspired with Nicholas Maulucci, of Simsbury, Conn., a retired employee of the state Department of Correction, and his former spouse, Lisette Maulucci – also known as Lisette Martinez – currently of Springfield, Mass., in a scheme to file false claims with the Connecticut Pharmacy Benefit Plan, which provides prescription drug benefits to enrolled state employees and eligible family members.

Compounded pharmaceuticals, unlike mass-produced, manufactured pharmaceuticals, are made to order based on a medical provider's prescription. Individual ingredients are mixed together by the compounding pharmacy in the strength and dosage specified for the recipient by the prescriber. They are not approved by the federal Food and Drug Administration (FDA) and can be significantly more costly than FDA-approved brand name and generic drugs.

The state alleges that Assured Rx paid the Mauluccis kickbacks for their own compound drug prescriptions and those of other Pharmacy Benefit Plan members they recruited into the scheme. In turn, these other individuals – several of whom are named as defendants – received payments from the Mauluccis in the manner of a classic pyramid scheme. The kickbacks were allegedly paid out of reimbursements Assured Rx received from the Pharmacy Benefit Plan for dispensing the compound drug products. The Mauluccis formed NLM, LLC, a limited liability company registered in Florida, for the alleged purpose of funneling the kickback payments.

The state contends that the Pharmacy Benefit Plan would not have approved or paid for the prescriptions had it known that these plan beneficiaries were being paid kickbacks by Assured Rx in exchange for arranging for the prescriptions for the compound drugs. The total cost to the Pharmacy Benefit Plan for prescriptions related to this alleged scheme was approximately $10,911,051.

This lawsuit, which seeks civil penalties, treble damages and other relief under the Connecticut False Claims Act, stems from an investigation launched by the Connecticut Office of the Attorney General in 2014 after a request from State Comptroller Kevin Lembo, who administers the Pharmacy Benefit Plan. This is the second lawsuit relating to compound drug billing fraud that was initiated as a result of the state's investigation. The state's probe into compounded pharmaceutical manufacturers and pharmacy providers is ongoing.

"The fraud we are alleging in this lawsuit is simply egregious," said Attorney General Jepsen. "Our investigation has developed evidence that we believe clearly shows how a number of former and current state employees, led by Nicholas and Lisette Maulucci, defrauded the state employee pharmacy plan to the tune of millions of dollars in exchange for their receipt of kickbacks from Assured Rx for these extremely expensive compounded drugs. My office will continue to aggressively investigate and hold accountable those who seek defraud Connecticut's taxpayers by filing false claims in our employee and public healthcare programs."

Comptroller Kevin Lembo said, "Today's action should send a clear-cut message: When you defraud the state’s health plan, you will get caught and you will face consequences. The state health plan is one of the most efficient plans in the nation, and we make every effort to monitor potentially troubling trends or transactions. This misuse of state health benefits diverted scarce state resources and compromised the welfare of the state health plan and those individuals and families who depend on it for essential health care. I'm grateful to Attorney General George Jepsen and his staff for their investigation and enforcement action, as well as our staff in the Office of the State Comptroller who notified the attorney general’s office after discovering problematic trends and discrepancies involving improper prescribing of compound drugs. I look forward to continuing our inter-agency partnership to ensure that the state plan is protected."

During the time period relevant to this complaint, the state alleges that fraudulent payments through the illegal scheme cost the Pharmacy Benefit Plan $394,403 for prescriptions for Nicholas Maulucci and $442,477 for prescriptions for Lisette Maulucci. The Mauluccis and NLM allegedly received a total of $2,655,958 in compensation for their role in the scheme. The Mauluccis in turn used a portion of those funds to pay kickbacks to the other individuals they recruited into the scheme.

Assured Rx, Nicholas Maulucci, Lisette Maulucci and NLM LLC are named as defendants in this litigation. The additional defendants named in the lawsuit are:

Carol Boardman-Scruse, of Bloomfield, Conn., an employee of the state Department of Developmental Services, is alleged to have cost the Pharmacy Benefit Plan a total of $317,791 in prescriptions for herself and a family member, and was allegedly paid $27,500 for her role in the scheme.

Ricardo Collazo, of Bloomfield, Conn., a retiree of the state Department of Correction, is alleged to have cost the Pharmacy Benefit Plan a total of $615,366 in prescriptions for himself and a family member, and was allegedly paid $24,600 for his role in the scheme.

James Corcoran, of Wethersfield, Conn., a retiree of the state Department of Correction, is alleged to have cost the Pharmacy Benefit Plan a total of $231,850 in prescriptions for himself, and was allegedly paid $12,000 for his role in the scheme.

Benjamin Franco, of East Haven, Conn., a retiree of the state Department of Correction, and his spouse, Jill Franco, are alleged to have cost the Pharmacy Benefit Plan a total of $524,542 in prescriptions for themselves and a family member, and Jill Franco was allegedly paid $27,700 for their role in the scheme.

Paul Germano, of Berlin, Conn., a retiree of the state Department of Correction, is alleged to have cost the Pharmacy Benefit Plan a total of $241,437 in prescriptions for himself and family members, and was allegedly paid $19,000 for his role in the scheme.

Edward Heller, of Enfield, Conn., a retiree of the state Department of Correction, is alleged to have cost the Pharmacy Benefit Plan a total of $282,229 in prescriptions for himself and a family member, and was allegedly paid $17,500 for his role in the scheme.

Joseph Heller, of Enfield, Conn., a retiree of the state Department of Correction, is alleged to have cost the Pharmacy Benefit Plan a total of $377,345 in prescriptions for himself and family members, and was allegedly paid $15,500 for his role in the scheme.

Francis Mancini, of Southwick, Mass., a retiree of the state Department of Correction, and his spouse, Sarah Mancini, are alleged to have cost the Pharmacy Benefit Plan a total of $ 525,307 in prescriptions for themselves, and were allegedly paid a total of $47,400 for their role in the scheme.

Todd Sokolowski, of Stafford Springs, Conn., a retiree of the state Department of Correction, is alleged to have cost the Pharmacy Benefit Plan a total of $380,304 in prescriptions for himself and a family member, and was allegedly paid $16,900 for his role in the scheme.

Todd Vining, of Enfield, Conn., a retiree of the state Department of Correction, is alleged to have cost the Pharmacy Benefit Plan a total of $561,643 in prescriptions for himself and a family member, and was allegedly paid $17,800 for his role in the scheme.

Joyce Wright, of East Longmeadow, Mass., a retiree of the state Department of Correction, is alleged to have cost the Pharmacy Benefit Plan a total of $270,578 in prescriptions for herself, and was allegedly paid $14,000 for her role in the scheme.

Additionally, Nicholas and Lisette Maulucci and their company, NLM, allegedly used other marketers who are not named as defendants who also arranged for prescriptions of Assured Rx compound prescription drugs for themselves as well as for certain covered family members and others. The state alleges that these marketers are alleged to have cost the Pharmacy Benefit Plan a total of $5,745,773 in prescriptions and were allegedly paid $230,764 for their roles in the scheme. Legal action against these or other culpable individuals is possible as the state's investigation proceeds.

Attorney General Jepsen thanked the Defense Criminal Investigative Service's New Haven Resident Agent for the considerable assistance provided in the investigation.

Anyone with knowledge of suspected fraud or abuse in the public healthcare system is asked to contact the Attorney General’s Antitrust and Government Program Fraud Department at 860-808-5040 or by email at ag.fraud@ct.gov; the Medicaid Fraud Control Unit in the Office of the Chief State’s Attorney at 860-258-5986 or by email at conndcj@ct.gov; or the Department of Social Services fraud reporting hotline at 1-800-842-2155, online at www.ct.gov/dss/reportingfraud, or by email to providerfraud.dss@ct.gov.

For more information on efforts to address fraud in state programs, please visit www.ct.gov/fightfraud.

Assistant Attorneys General Karla Turekian and Rachel Davis, Legal Investigator Thomas Martin, and Assistant Attorney General Michael Cole, chief of the Antitrust and Government Program Fraud Department, are assisting the Attorney General with this matter.

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Jaclyn M. Severance
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