GRAND RAPIDS, Mich. — A Lansing pharmaceutical sales representative has been sentenced to one year in prison for defrauding Michigan State University of $1.2 million. He is Daniel Brown from Dimondale.
According to the Department of Justice, Brown agreed to have expensive and medically unnecessary compound pain creams and patches prescribed to Michigan State University. The prescriptions were filled by pharmacies in Mississippi. Brown solicitated a local physician to sign the prescriptions. He also split commission payments that the Mississippi pharmacies paid him for directing the prescription to their pharmacies. Michigan State University’s health plan was charged $2,000-$3,000 for each prescription.
Brown was sentenced to 12 months and one day in prison on Monday. U.S. District Judge Robert J. Jonker also sentenced him to three years of supervised release. Brown has also been ordered restitution, which totals in $1,267,418.
Brown later cooperated in the investigation and prosecution of the people operating the pharmacies in Mississippi. They were held criminally responsible in related federal cases for more than $200,000,000 in total claims paid for medically unnecessary compounded medications that resulted from illegal kickbacks paid to sales representatives and physicians around the country.
“Individuals like Mr. Brown, who enrich themselves through fraud schemes, undermine the healthcare system and drives up costs for everyone,” said James A. Tarasca, Special Agent in Charge of the FBI in Michigan. “The FBI remains committed to working closely with our law enforcement partners to swiftly and thoroughly investigate such fraud allegations and bring criminals who engage in these schemes to justice.”
“Health care fraud raises costs on consumers, hurts businesses, and can subject persons to unnecessary treatment,” said U.S. Attorney Mark Totten. “Those who scheme to defraud our public and private health care providers, and those who pay and receive kickbacks to influence the generation of medical services, face aggressive prosecution, significant financial penalties, and the real prospect of prison.”