A Port Washington man who illegally sold repackaged prescription drugs out of pharmacies he owned in Queens and the Bronx has been sentenced to three years in prison and ordered to repay more than $7 million in restitution, federal prosecutors said Thursday.
Purna Chandra Aramalla, 67, was arrested in December 2013 on charges he defrauded Medicaid and Medicare of more than $10 million in the scheme, which federal prosecutors said ran from January 2010 to September 2013.
In a statement, U.S. Attorney Preet Bharara said Aramalla’s scheme “jeopardized the health of anyone induced to sell his or her prescription or medication, and anyone who unwittingly purchased repackaged drugs.”
Aramalla, who owned and operated A Fair Deal Pharmacy Inc. in Queens and Quality Drug Inc. in the Bronx, would purchase medications from patients who chose not to use them for treatment and then resell them to customers.
He also purchased prescriptions from customers, who were then given a percentage of reimbursements that Aramalla secured from Medicaid, Medicare and ADAP, according to Bharara’s office.
A joint investigation by the U.S. Attorney’s office, Federal Bureau of Investigation and Internal Revenue Service revealed approximately $10 million in reimbursements missing from records documenting Aramalla’s drug purchases through legitimate wholesale providers.
In addition to issuing a 36-month prison sentence, U.S. District Judge Paul A. Crotty ordered Aramalla pay back taxes, applicable penalties and $7,503,605 in restitution to victims of the scheme.
