If the Drug Supply Chain Security Act was intended to deter the exponential growth of prescription drug diversion and counterfeiting crimes over the last decade, someone forgot to tell Robin Deleonrosa, who was recently arrested for his role in a $1.9 million black market diversion scheme involving HIV drugs.

According to the U.S. Department of Justice press release, “From at least in or about September 2013 until April 2016, DELEONROSA was part of a black market distribution network that distributed bulk quantities of second-hand HIV prescription drugs to unsuspecting consumers.  In particular, the members of the black market distribution ring would initially obtain the HIV prescription drugs by purchasing these drugs from patients to whom these medications were originally prescribed.  The prescription HIV bottles were then collected and the labels (containing the patients’ names) were removed using dangerous substances, including lighter fluid and other potentially hazardous chemicals.  Through this process, the members of the black market distribution network made the bottles appear new in order to conceal the fact that the bottles had previously been dispensed to patients.  This process allowed the bottles eventually to be re-sold to pharmacies and unsuspecting consumers.  Consumers who eventually received these second-hand prescription HIV medications were not aware that the prescription bottles had been previously sold, treated with potentially hazardous chemicals, and possibly not stored under conditions sufficient to maintain their medical efficacy. 

In addition to placing consumers at significant risk, Medicaid and other health insurers were defrauded in multiple ways by DELEONROSA’s scheme.  On the front end, health care benefit enrollees, including Medicaid recipients who participated in this scheme, filled their prescriptions for little or no cost with the intention of selling the drugs into the underground black market rather than taking the drugs as prescribed to treat their illnesses.  Because health benefits, such as HIV prescription drugs, are for the sole use of the insured, Medicaid and other health care benefit plans would not have paid for such drugs if the beneficiaries had disclosed their intent to sell the medications rather than take them as prescribed.  On the back end, Medicaid was further defrauded by reimbursing pharmacies for the cost of prescription HIV drugs as if the drugs were new and obtained from a legitimate stream of commerce, when, in truth and in fact, the drugs were second-hand and came from the black market.  Accordingly, as result of this scheme, health care benefit plans, including Medicaid, were defrauded multiple times by paying for the same drugs twice. 

As is detailed in the Complaint, DELEONROSA served as a middleman in this scheme – selling hundreds of second-hand prescription HIV medication bottles to a cooperating source (“CS”) on multiple occasions, with a total estimated Medicaid reimbursement value of more than $1.9 million.  DELEONROSA stored these second-hand prescription HIV medication bottles in his residence in the Bronx, and provided the bottles to the CS in suitcases and a duffel bag.  Many of the HIV prescription bottles that DELEONROSA sold still bore the labels of the patients to whom the drugs were originally dispensed.  In 2014, DELEONROSA also provided the CS with second-hand HIV prescription medication bottles that were to be delivered to addresses in California, but which were intercepted by Federal Express due to the suspicious nature of the packages.”

Until the plague of persistent oversight inadequacies affecting our nation’s wholesale distributors and pharmacies on supply chain issues is addressed, illicit suppliers, like Deleonrosa, will continue to flourish and safety of vulnerable patients will remain at risk.