A New York City medical practice that flooded the black market with up to $550 million worth of oxycodone pills was ostensibly owned by a physician, but thugs with nicknames ran the pill mill on a daily basis, according to federal and state prosecutors, who busted the operation earlier this month.
And the thugs were not reluctant to use muscle to keep prescribers productive and obedient, federal prosecutors said.
One physician not named in the indictment was writing 50 medically unnecessary prescriptions for oxycodone each day. Three masked men believed to be "crew chiefs" — pill mill lieutenants in charge of fake patients — told him at gunpoint outside the office that they were not happy with his low output, prosecutors said.
Robert Terdiman, MD, in contrast, wrote as many as 126 bogus prescriptions a day for oxycodone, helping make the practice the largest pill mill in the Northeast, as one agent with the US Drug Enforcement Administration described it. But when Dr. Terdiman, a board-certified internist, telephoned police after a fake patient threatened him, another crew chief slashed his car tires and told him never to call the police again, the federal indictment stated.
The business of law and order, after all, belonged to defendants such as Sin, Crusader Rob, Ra-Ra, and Cash Money, also known as Pork Chop, a bouncer who helped manage dozens of fake patients and other pill-seekers crowding the sidewalk outside the office, according to prosecutors. One unnamed bouncer hurled a wayward clinic patron through the front window. Crew chiefs also deployed armed bodyguards nearby in case things got out of hand.
The reign of terror extended to the office staff. One employee objected to how much control the crew chiefs exerted, only to get thrown against a wall, according to the indictment. Her injuries were severe.
Prosecutors said the evidence points to dozens of violent acts that represented the drug ring's modus operandi.
"The world of prescription drug trafficking is looking more and more like the world of old-school trafficking in narcotics like heroin, cocaine, and crack," said Preet Bharara, the US Attorney for the Southern District of New York, in a news release. "In this case, the drug spot was a clinic controlled by traffickers, often through intimidation and violence."
Bharara, however, did not portray the prescribing physicians and office staff as innocent victims. He called them "corrupt."
Defendants Could Face 20-Year Sentences
In all, 26 individuals, including crew chiefs, bouncers, office staff, Dr. Terdiman, and clinic owner and operator Kevin Lowe, MD, were charged with conspiracy to distribute narcotics in a federal indictment unsealed on February 5 and an expanded version released the next day. The crime carries a maximum sentence of 20 years in prison. Dr. Terdiman also was charged with fourth-degree conspiracy and criminal sale of a controlled-substance prescription in a state court in New York City.
Prosecutors filed the charges after a 2-year investigation involving confidential informants, undercover agents, and thousands of hours of surveillance to build their case. Pitching in were local police departments, the Drug Enforcement Administration, the state narcotics prosecutor in New York City, the New York State Health Department, and the Internal Revenue Service, among other organizations.
Dr. Lowe, a board-certified internist, has pleaded not guilty. Robert Dapelo, an attorney for Dr. Lowe, told Medscape Medical News that the allegations against his client are false. Dr. Terdiman also has entered a not-guilty plea.
"When all the facts come out, we expect justice will be done," Lloyd Epstein, Dr. Terdiman's attorney, said in an interview with Medscape Medical News.
Many of the defendants have been criminal defendants before. Six of the crew chiefs each have been convicted of multiple felonies that include drug-related offenses, armed robbery, assault, and witness tampering.
"Our Providers Serve Your Every Need"
Dr. Lowe's medical practice, called AstraMed, began as a single office in Queens, New York, in 1993 and expanded to 8 locations with 8 physicians and 4 nurse practitioners at last count, according to the AstraMed Web site. "Here the patient is the center of the universe, and our providers serve your every need," it states. The federal indictment concentrates on 2 AstraMed offices in the Bronx.
Federal prosecutors allege a complex criminal conspiracy. Each crew chief recruited and paid a crew of fake patients to come to an AstraMed office for pain management. Office visits cost $300 in the form of a money order, which crew chiefs supplied on behalf of their members. The visits lasted only a minute or two. Physicians didn't perform physical exams. They invariably would prescribe high dosages of oxycodone: either a total of 180 or a daily dose of six 30-mg tablets.
Crew members filled their prescriptions at pharmacies as far away as Pennsylvania. Crew chiefs made it a point to recruit underlings with conditions such as HIV/AIDs who had established relationships with pharmacies. Crew members then turned over the pills to their crew chief, who sold them on the street, according to the indictment.
Money changed hands in all kinds of ways. Dr. Lowe compensated Dr. Terdiman and other physicians solely on the basis of how many oxycodone prescriptions they wrote, prosecutors said. Crew chiefs would pay AstraMed office staff "hundreds of dollars in cash at a time" to get their crew members seen by a physician. Crew members would pay crew chiefs and office staff for fake magnetic resonance imaging scans to prove they were injured, as well as urine samples testing positive for oxycodone to show that they were taking the drug and not trafficking it. These ruses were meant to fool law enforcement agencies.
Then there were the "new patients," individuals who were not crew members but, typically, addicts or drug dealers, according to the indictment. Crew chiefs or office staff would charge them as much as $1600 in cash as an admission fee. After they filled their prescriptions, some new patients would sell their pills to crew chiefs inside the office or on the sidewalk.
Fortunes were made this way. Prosecutors allege that from January 2011 to January 2014, the operation produced more than 31,500 bogus prescriptions for 5.5 million oxycodone pills, which typically sold on the street for about $30 apiece in New York City and up to $100 apiece in neighboring states. Prosecutors put their total black-market value at between $170 million and $550 million. Dr. Lowe, they said, collected almost $12 million in fees for office visits.
Twilight of a Medical Career
Although the federal indictment said that Dr. Lowe used more than 1 physician to generate illegal oxycodone prescriptions, Dr. Terdiman is the only other physician charged so far in the case. Then again, he allegedly accounted for more than half of the operation's prescriptions during the 3 years covered in the indictment, writing them during a 20-month period.
Dr. Terdiman, 68 years old, received his medical degree from New York University in 1971 and his residency training at Mount Sinai Hospital. He lived and worked in Westchester County, north of New York City, and for a time practiced at Mount Pleasant Medical Group in Valhalla, New York.
He garnered praise in 2009 from a former patient on Vitals, a Web site for reviewing healthcare providers. "Dr. Terdiman, in addition to being an outstanding physician, is also a brilliant and astute thinker and speaker," the patient wrote. "I've always been impressed by his sagacity and quickness. I recommend him to anyone, but he may have retired from private practice."
He apparently did retire in 2004, according to a news release from the Office of the Special Narcotics Prosecutor for the City of New York. Six years later, he applied for a medical license in New Mexico. Minutes of the New Mexico Medical Board from May 2010 show the board granted him a "resident/training license" and permission to enter a minisabbatical program at the University of New Mexico.
In September 2011, however, Dr. Terdiman signed a consent agreement with the New Mexico board saying that he had been allowed to withdraw his license application because of "medical-related reasons." It also stated that the board had investigated Dr. Terdiman, "as required by board rules given the length of time that had passed since he had practiced medicine."
Minutes of a board meeting the month before stated that if Dr. Terdiman did not accept the offer to withdraw his application, the board would issue a "notice of contemplated action based on, but not limited to, manifest incapacity or incompetency to practice."
Asked about his client's health, attorney Lloyd Epstein replied, "He has issues."
Dr. Terdiman eventually joined AstraMed in June 2012, according to prosecutors. The federal indictment suggests that he did not enjoy much respect there, at least among the crew chiefs. "I don't want to hear no nonsense out of you today," crew chief Donald "Buster" Carr told Dr. Terdiman one day last December.
His last day at AstraMed was February 4, when he was arrested on the job. Law enforcement agents later searched his residence, a motel in Yonkers, New York. They found a revolver and 47 rounds of ammo inside a TV stand.
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Cite this: Thugs Controlled Pill Mill Doctors at Gunpoint, Feds Say - Medscape - Feb 14, 2014.