DermaTran, other pharmacies settle with DOJ over pain cream false claims


A former compounding pharmacy, a related pharmacy billing company, and three retail pharmacies agreed to pay more than $6.8 million to settle alleged violations of the False Claims Act for participating in a scheme to charge patients in federal health programs hundreds of dollars above the real price for pain relief creams.

An accountant working for the compounding pharmacy, DermaTran Health Solutions, blew the whistle on the alleged fraud and filed a lawsuit against the company in 2017 in U.S. District Court for the Northern District of Georgia. In line with the qui tam provisions of the False Claims Act, she will receive more than $1.4 million, the Department of Justice (DOJ) said in a press release Wednesday.

DermaTran opened in 2012 to make and sell custom pain creams. At the same time, a separate company, Pharmacy Insurance Administrators (PIA), was created to handle the billing for DermaTran.

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