NJ Executives Admit $38M Prescription Drug Fraud Scheme

Two New Jersey women who co-owned a pharmaceutical marketing company have admitted their roles in a $38 million health care fraud scheme that involved customized prescription drugs.

Samantha Zaretzky, 42, of Wayne, and Lee Nichols, 43, of Fair Haven, pleaded guilty remotely in federal court to conspiracy to commit health care fraud.

Over a two-year span, Zaretzky and Nichols used their company, Synergy Medical, to exploit the way that claims for “compounded medication” are processed, according to federal prosecutors.

A pharmacist can mix such specialty medication after a doctor determines that a drug already approved by the Food and Drug Administration does not meet a patient’s specific needs.

Examples include when a patient has an allergy to a particular dye, or when they cannot swallow a pill and need medication in liquid form, as explained by the FDA.

Some of the most common include drugs for pain management or hormone replacement, according to USPharmacist.

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Zaretzky and Nichols researched which custom drugs would make them the most money, according to U.S. Attorney Philip Sellinger. They and sales representatives recruited people with insurance willing to go through getting unnecessary and expensive prescriptions filled.

From April 2014 to June 2016, prosecutors said the scam involved willing medical professionals, who were paid off for prescribing such custom meds.

Zaretzky and Nichols were then paid kickbacks from the compounding pharmacies they used.

When sentenced in April 2023, each woman faces up to 10 years in prison and a fine of $250,000 — or twice the gross gain or loss from the scheme, whichever is greatest.