PHILADELPHIA – United States Attorney Jennifer Arbittier Williams announced the criminal and civil resolutions of multi-year investigations of various health care fraud schemes involving prescriptions for compounded medications formulated by Heritage Therapeutics, LLC, a Delaware County pharmacy. The investigations yielded six criminal convictions and recovered over $8.7 million in criminal forfeitures, criminal restitution, and civil settlement payments.

From 2013 into 2015, Heritage formulated expensive compounded medications such as pain creams, scar creams, and vitamins. These compounded medications were prescribed to, among others, beneficiaries of TRICARE, a federally funded health care program for military members, retirees, and their families. The investigations revealed that Heritage paid commissions to some of its sales representatives for referring Heritage’s compounded medications to medical providers who prescribed them to TRICARE beneficiaries. Some of these sales representatives, in turn, paid kickbacks to the medical providers to induce them to issue those prescriptions.

The investigations were conducted by agents from, in addition to DCIS, the Office of Personnel Management, Office of Inspector General; Department of Labor, Office of Inspector General; United States Postal Service, Office of Inspector General; and U.S. Army Criminal Investigation Division.

Assistant United States Attorney Mary Kay Costello and former Assistant United States Attorney John Crutchlow prosecuted the criminal cases. Assistant United States Attorneys Bryan C. Hughes and Rebecca S. Melley handled the civil investigation and settlements, assisted by Auditor George Niedzwicki.