• Black Market Distributor of Diverted HIV Medications Worth Approximately $4 Million Arrested

    Author : White Collar Firm May 25, 2016

    Press Release: Black Market Distributor of Diverted HIV Medications Worth Approximately $4 Million Arrested

    https://www.justice.gov/usao-sdny/pr/manhattan-us-attorney-announces-arrest-black-market-distributor-diverted-hiv

    Who:

    Robin Deleonrosa, owner of a Bronx barbershop, the defendant

    What:

    U.S. Attorneys at the Southern District of New York, federal court, charged Deleonrosa with 1 count of conspiracy to commit health care fraud. This charge carries a maximum potential sentence of 10 years in prison.

    Where: Deleonrosa was charged in the Southern District of New York, and the crime allegedly happened in New York, mostly Bronx County. Deleonrosa lived in Bronx, New York.

    When: The crimes allegedly occurred between about September 2013 until April 2016. Deleonrosa was arrested on April 29, 2016.

    Why: Deleonrosa is charged with being part of a conspiracy to purchase HIV medications from health care benefit enrollees who had it disposed for them legally, and then repackaged and resold these medications to other illegal redistributors and pharmacies in an attempt to disguise that the medication was second-hand (“second-hand medication”). Many of these enrollees were Medicaid recipients. The methods used to deface and hide the original packaging were unsafe and the medications were stored in unsafe conditions, including in Deleonrosa’s Bronx apartment.  This practice essentially charged Medicaid twice for the same medicine.

    How: The illegal practice of diverting and trafficking HIV medications generally begins with a health care benefit enrollee (“patient”) who is dispensed HIV medication. Oten, these patients are Medicare recipients who receive these medications at no cost. These patients then sell the medications to third parties illegally. “Collectors” purchase the medications from these patients. Collectors generally sell these medications to “Aggregators,” who purchase large quantities of these second-hand medications from multiple Collectors. Either Collectors or Aggregators remove the labels from these bottles in an attempt to hide the patient’s names and the fact that the bottles have been previously dispensed. Often, they use hazardous chemicals like lighter fluid to accomplish this. With the removing of the label comes the removing of the expiration dates of each medication bottle, carrying additional health risks to patients ingesting these pills. These second-hand medications are then sold to pharmacies as new medication, which are then dispensed to unsuspecting consumers. A confidential informant (“CI”) revealed to authorities that he sold Deleonrosa HIV medication that he had been prescribed. He had also observed Deleonrosa obtaining more second-hand medications in his barbershop. This CI started participating in the sale of these medications for Deleonrosa. In one instance, he mailed the second-hand medications he sold to Deleonrosa along with additional medications Deleonrosa provided by FedEx. One of these deliveries was intercepted by FedEx security and confiscated because it was categorized as “jewelry,” but employees heard loose pills when the boxes were shaken. These packages were surrendered to federal law enforcement. Much of these packages still had labels on them. The CI met with Deleonrosa at the direction of law enforcement and discussed resuming distributing the second-hand medications for Deleonrosa, which Deleonrosa agreed to. What followed were conversations making plans for future deliveries of products and text messages sent between the CI and Deleonrosa regarding the different HIV medications Deleonrosa had and how much each would cost. Deleonrosa and the CI met, where Deleonrosa showed the CI a suitcase full of HIV medications, which the CI was to sell and provide a portion of the proceeds to Deleonrosa. This suitcase contained over $300,000 worth of HIV medications, and many still contained patient labels. The CI conducted 2 more of these operations, some of which was audio-recorded by the CI for law enforcement. A search of Deleonrosa’s residence on the day of his arrest resulted in the discovery of over 1,000 bottles of second-hand HIV medication with an estimated value of $1.8 million, lighter fluid and over $70,000 in cash.

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