Dr. Kenneth D. Nahum, his oncology practice, and practice manager Ann Walsh have agreed to pay $1.7 million to settle federal allegations they imported unapproved chemotherapy drugs from foreign suppliers and billed Medicare for treatments using those illicit substances. The deal resolves claims that from April 1, 2010, to January 31, 2011, the Howell and Wall, New Jersey-based practice knowingly used cancer drugs not approved by the FDA, putting patients at risk while raking in federal reimbursements.
Nahum, a Monmouth County oncologist, and Walsh, his wife and the practice’s day-to-day manager, sourced the drugs through a foreign distributor, bypassing U.S. safety protocols. The drugs—intended for terminal patients undergoing aggressive treatment—were injected into patients before the practice submitted false claims to Medicare. Because Medicare only pays for FDA-approved medications, each claim constituted a violation of the federal False Claims Act, prosecutors say.
‘Illegally imported drugs avoid the FDA’s rigorous oversight and manufacturing standards,’ said U.S. Attorney Paul J. Fishman. ‘Health care providers who import those drugs are exposing their patients to serious risks of harm from contaminated or counterfeit products.’ Federal agents say the scheme exploited a critical gap in the pharmaceutical supply chain—one meant to protect the nation’s most vulnerable.
Jeffrey J. Ebersole, special agent in charge of the FDA’s Office of Criminal Investigations in New York, emphasized that patients deserve assurance their treatments meet federal safety benchmarks. ‘OCI will continue its vigilance over the prescription drug supply chain to ensure that the drugs reaching patients comply with federal law, and that those who attempt to circumvent the agency’s oversight will be brought to justice,’ Ebersole said.
The investigation was led by FDA criminal investigators and agents from the U.S. Department of Health and Human Services – Office of the Inspector General. The case was prosecuted by Assistant U.S. Attorneys Sarah Wolfe, Andrew A. Caffrey III, and Charles Graybow, part of a dedicated Health Care and Government Fraud Unit created by Fishman in 2010. Since its formation, the unit has recovered over $1.32 billion in fraud-related judgments and settlements.
While the settlement resolves the allegations, the government stresses that no determination of liability has been made. Nahum and The Oncology Practice were represented by Michael B. Himmel and Matthew M. Oliver of Roseland, New Jersey. Ann Walsh was represented by Salvatore T. Alfano of Bloomfield, New Jersey. The case remains a stark warning: even in medicine’s most sacred spaces, profit can poison purpose.
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Key Facts
- State: New Jersey
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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