DEARBORN — Riad “Ray” Zahr, a Dearborn pharmacist, and two specialty pharmacies that he formerly owned and operated have agreed to pay the U.S. $1 million.

The $1 million is to resolve allegations that they submitted false claims for the drug Evzio, an injectable form of naloxone hydrochloride indicated for use to reverse opioid overdose, and was the highest-priced version of naloxone on the market; and insurers frequently required the submission of prior authorization requests before they would approve coverage for Evzio.

It was contended that, between Aug.1, 2017 and June 30, 2019, Plymouth Towne Care Pharmacy dba People’s Drug Store and Shaska Pharmacy LLC dba Ray’s Drugs submitted false claims for Evzio to Medicare. 

The government alleged that People’s Drug Store and Ray’s Drugs submitted false and misleading prior authorization requests for Evzio that contained clinical assertions for which the pharmacies lacked any factual basis and that, at times, Zahr and the pharmacies initiated Evzio prescriptions based on rudimentary patient lists with only basic biographical details.

It’s also alleged that Zahr and the pharmacies included assertions in prior authorization requests for Evzio purportedly authored by prescribing physicians regarding the comparative effectiveness of the drug that Zahr’s pharmacies actually authored and that the prescribing physicians did not review, sign or submit the prior authorizations at issue.

The settlement also resolves allegations that Zahr, People’s Drug Store and Ray’s Drugs dispensed Evzio prescriptions to Medicare beneficiaries at times without collecting or attempting to collect co-payment obligations for Evzio, in violation of the Anti-Kickback Statute.

“We expect the submission of truthful and non-misleading documentation by all those involved in the delivery of health care goods or services, including pharmacies that submit claims for pharmaceutical products,” Brian M. Boynton, acting assistant attorney general of the Justice Department’s Civil Division, said. “This settlement demonstrates the department’s continuing commitment to preventing fraud in Medicare and other taxpayer-funded healthcare programs.”