Poconos doctor facing federal suit as PA opioid settlement progresses

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A Poconos-based family medical practitioner is facing a federal civil lawsuit on allegations that he issued medically unnecessary prescriptions for a fentanyl-based medication.

The United States Attorney's Office for the Middle District of Pennsylvania announced April 7 that a suit had been filed against Dr. Peter J. Baddick III for violations of the False Claim Act. Baddick allegedly prescribed Subsys, a fentanyl-based spray manufactured by Insys Therapeutics which is used to treat breakthrough cancer pain, to two patients when the medication "was either not medically necessary or otherwise inappropriate."

According to a release from the U.S. Attorney, it is alleged that Baddick — who ran Penn Medical Group, P.C., in Lehighton, Carbon County, which ceased operations in Sept. 2019 — prescribed Subsys to the aforementioned patients, neither of whom had cancer, from April 2015 through December 2015, even when the patients raised concerns about the drug's effects.

A total of 18 prescriptions cost Medicare and TRICARE federal health programs $308,701.94 for those two patients alone.

U.S. Attorney John Gurganus said that the Department of Justice had a "duty to protect the health and welfare of our citizens," and to ensure that those programs were only used for necessary medical services.

“Subsys is a potent and addictive opioid that was approved to treat cancer patients suffering from breakthrough pain. It is also a very expensive drug. Doctors who write medically unnecessary prescriptions for Subsys irresponsibly risk their patients’ wellbeing at taxpayer expense. It is imperative that we hold these healthcare providers accountable for their actions,” Gurganus said.

The Department of Defense Office of Inspector General's Defense Criminal Investigative Service Special Agent in Charge Patrick J. Hegarty, of the DCIS Northeast Field Office, noted that protecting TRICARE, a program for "active-duty military personnel, retirees, and dependents," is a top priority for DCIS.

“When providers write medically unnecessary prescriptions for controlled substances and abuse the submission of fraudulent claims to TRICARE, they put TRICARE beneficiaries at risk and undermine the integrity of the program," Hegarty said. "The civil fraud action announced today demonstrates the DCIS' ongoing commitment to work with the U.S. Attorney's Office, Middle District of Pennsylvania, to investigate health care providers who cause false claims to be submitted to TRICARE.”

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The case against Baddick was investigated by the Department of Defense Office of Inspector General — Defense Criminal Investigative Service and the U.S. Attorney’s ACE Unit. The U.S. Department of Health and Human Services Office of Counsel to the Inspector General assisted with the investigation. It is being handled by Assistant United States Attorney Brian Simpson.

The United States previously prosecuted Insys under criminal information filed in the District of Massachusetts, with Insys agreeing to a global resolution of the civil and criminal investigations.

As part of the civil resolution, Insys agreed to pay $195 million to settle allegations that it violated the False Claims Act. As part of the criminal resolution, the company entered into a deferred prosecution with the government, its operating subsidiary pleaded guilty to five counts of mail fraud, and the company was subject to a $2 million fine and $28 million in forfeitures.

According to Richard J. Hollawell and Associates, a law firm based in Woolwich Township, New Jersey, this federal case is directly connected to a lawsuit filed by the firm in 2019.

Baddick and Penn Medical Group, P.C., had previously been named as co-defendants — alongside DePietro's Pharmacy LLC and owner Tom DePietro — in a lawsuit filed in September 2019 alleging that he had been reckless in prescribing Subsys to one Anna Pinarbasi of Throop, Pa.

According to the civil suit, Baddick had developed a close relationship with John Cacciatore, a Subsys Specialty Sales Representative for Insys who had been assigned to the Scranton/Wilkes-Barre territory around 2015.

In June of that year, the suit claims that Cacciatore made an "unannounced, unsolicited 'house call' to the home of Anna Pinarbasi," who suffered from a condition not approved to be treated with Subsys.

Cacciatore allegedly instructed Pinarbasi to not request Subsys from her regular medical team, but instead to make an appointment with Baddick, who "recklessly, wantonly and negligently" prescribed "dangerous amounts and combinations of schedule II narcotics, along with Subsys" which led to her becoming addicted to the drug.

Pinarbasi allegedly suffered narcotic withdrawal when she ceased taking the medication in both July and December 2015, requiring trips to what was then known as Pocono Medical Center in East Stroudsburg. She was later admitted to an in-patient narcotic detoxification protocol in New Jersey due to her "severe narcotic withdrawal symptoms."

Pinarbasi's case was settled pre-trial, but Hollawell has seen countless similar stories play out over the past 15 years that he has represented clients in opioid-based lawsuits. At the moment, he is currently representing six clients in other opioid cases.

While Hollawell is unsure of whether the federal government will consider pursuing further charges against opioid manufacturers, and whether those charges will be criminal — "they keep things very close to the vest," he said — he does expect further action in the near future.

"I mean, I've been following developments, even over the last year or so, and seeing different doctors and various states that either have their licenses taken away, or they were indicted, because they were being paid money, by Insys. More shoes are dropping for sure," Hollawell said.

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Hollawell noted that manufacturers have played fast and loose with rules and regulations in the past, citing Pennsylvania manufacturer Cephalon — since acquired by Teva Pharmaceutical Industries, Ltd. — and Purdue Pharma, who have been able to pay fines that amount to a drop in the bucket when compared to overall sales.

However, increased attention from the federal government paired with individual civil suits could keep attention focused upon these drug manufacturers and distributors, which could in turn lead to changes regarding how these companies are reprimanded.

"They've been fined multiple times. and they just went on to make billions and billions more in sales. So that's kind of how they looked at it, like, 'Okay, we'll do this: We'll do this illegal marketing, we'll probably just have to pay some fines.' So definitely this changed with the prosecutions. And as you know, it's long needed," Hollawell said.

After handling private opioid-based cases for 15 years, Hollawell said that more attention needs to be focused on the licensing boards that oversee physicians, especially ones that have allegedly partaken in backdoor dealings with drug manufacturers. Offers of "kickbacks" — comped trips to speaking engagements, financial incentives and so on — have often been cited in opioid cases, including that of Baddick.

"I've worked over the years with the DEA, different US Attorneys' Offices throughout the country. Licensing boards: that's where you need to, I think, do more. With the licensing boards, I think that they've been too lenient," Hollawell said.

According to the Opioid Data Dashboard, between 2012 and 2020, Lackawanna County saw 92 estimated accidental and undetermined drug overdose deaths. Numbers of individuals in the county estimated to drug use disorder have fluctuated over the past few years, dropping from 6,358 in 2018 to 4,898 in 2019, the most recent year for available data.

The federal suit against Baddick comes just as several major pharmaceutical companies are preparing to pay out penalties for their role in the country's opioid epidemic.

The Department of Drug and Alcohol Programs (DDAP) Secretary Jen Smith, Pennsylvania Attorney General Josh Shapiro, Butler County Commissioner and County Commissioners Association of Pennsylvania Board Chair Kevin Boozel, and the Berks County Council on Chemical Abuse came together Wednesday for a discussion on an incoming opioid settlement for Pennsylvania.

The commonwealth is anticipated to receive a maximum of $1.07 billion from a $26 billion agreement with the nation’s three major pharmaceutical distributors — Cardinal, McKesson, and AmerisourceBergen — and Johnson and Johnson as these companies were key players in the start and proliferation of the opioid epidemic.

"The Office of Attorney General is using every tool available to help provide communities across Pennsylvania with relief from the opioid crisis, which sadly kills 14 Pennsylvanians each and every day. That includes holding drug companies that fueled this crisis, that manufactured this crisis, accountable," Shapiro said.

This week, the Office of Attorney General is filing consent decrees with Commonwealth Court to make the settlement effective. Once those are approved, the Pennsylvania Opioid Misuse and Addiction Abatement Trust will oversee disbursement of funds, with the first payments likely made available to local governments by early summer, followed by a second round in early fall.

According to Shapiro, all 67 commonwealth counties, along with more than 240 local governments that have a population of 10,000 or more, signed on to the national settlement.

Counties will take the largest portion of the settlement at 70%, with distribution determined by the combined metrics of overdose deaths, opioid use disorder hospitalizations, naloxone administrations, and percentage of opioid shipments; 15% will go to litigating counties, subdivisions, district attorneys, and special districts; the last 15% will go to the commonwealth as a whole to be appropriated by the legislature. Payments are expected to begin in the coming months.

Funding will be used for opioid remediation programs and initiatives, including expanding and supporting the use of naloxone and medication-assisted treatment, treatment/screening for pregnant/post-partum women and babies with Neonatal Abstinence Syndrome, warm hand-off programs, treatment for incarcerated population, prevention and education, harm reduction strategies such as syringe service programs, data collection and research, enhancing connections to care, drug courts and diversion programs, supporting first responders, and training, the DDAP stated.

Smith noted that is it pivotal to "have continued urgency to address this crisis at the community level" in order to address area-specific needs and wants.

"That's where the pressing needs lie, and where the real change begins," Smith said. "This funding will provide opportunities to reach underserved individuals struggling with substance use disorder and provide the necessary tools to help them find treatment and recovery."

Boozel agreed, noting that allowing counties to dictate their own usage of funding is vital to addressing the opioid epidemic and its effects on a local level, as strategies that work in an area like Allegheny might not fly as well in the Poconos.

“Counties are ultimately responsible for the delivery of the quality of drug and alcohol services to our local communities. The attorney general and his team listened to the needs of the communities, afforded us the opportunity to make the best use of those funds on a local level, and will continue to fight against this deplorable disease,” Boozel said.

This article originally appeared on Pocono Record: Lehighton doc facing federal suit as PA opioid settlement progresses