Specialty pharmacy pays $17M to settle Medicare billing fraud lawsuit

Glen Mills, Pa.-based Pentec Health, which provides drug compounding services, has agreed to pay $17 million to resolve False Claims Act allegations, according to the Department of Justice.

The government alleged Pentec billed Medicare and other federal healthcare programs for excessive amounts of product wasted during the compounding of its drug, Proplete, from 2007-18. The government further alleged that Pentec induced prescriptions and use of Proplete by waiving copayments and deductibles owed by Medicare beneficiaries.

The company also allegedly submitted duplicate and improperly coded claims to the Federal Employee Health Benefits Program.

In addition to the monetary settlement, Pentec entered into a five-year corporate integrity agreement with HHS' Office of Inspector General.

"Pentec's resolution of this civil matter represents a business decision made in the best interest of our company and nothing more," Pentec CEO Joseph Cosgrove said in a press release. "We continue to deny the assertions and allegations made by the government pertaining to this settlement which in any way challenges our business practices."

A former Pentec employee originally brought the allegations against the company under the qui tam, or whistle-blower, provisions of the False Claims Act.

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