Physiatry Practice Management Resources

By MICHAEL HINKELMAN
Source: Philadelphia Daily News
215-854-2656

A federal grand jury yesterday indicted five people and a local pharmacy in an alleged conspiracy to illegally distribute weight-loss drugs over the Internet.

The operation, run by a California-based Internet company, Rx Medical One, netted more than $33.6 million in illicit proceeds, the indictment alleged.

Among the five people charged were Steven Klinman, 57, an M.D. from Elkins Park, and Alexander Atchildiev, 30, a pharmacist from Huntingdon Valley. (The others charged were two Los Angeles-area businessmen who owned Rx Medical One and an M.D. from Toms River, N.J.)

Universal Pharmacy Solutions, Inc., a pharmacy that only filled online prescriptions and was owned by Atchildiev, also was indicted.

"This was high-tech drug dealing," said U.S. Attorney Patrick Meehan. "If you exclude meeting a dealer on a corner, the only difference between this and a street-level conspiracy was that the customers were asked to fill out a questionnaire."

The charging papers said Rx Medical One used online affiliates to advertise prescription weight-loss drugs and orders would be taken by Rx Medical One.

Customers who wanted to buy drugs also had to complete a questionnaire giving their personal and medical information. Rx Medical One would then have medical doctors it recruited review the questionnaires.

If a doctor approved the request, Rx Medical One had a pharmacy retrieve the order online, fill it and ship it out using an overnight delivery service.

The indictment alleges that Klinman approved almost 39,000 prescriptions for Rx Medical One customers between September 2003 and May 2004 and was paid $221,028.

Prosecutors also want Klinman to forfeit upwards of $282,255.

The charging papers also said Klinman never physically examined, met or talked to any of the Rx Medical One customers he authorized prescriptions for or attempted to contact the customers' personal doctors.

Glenn Zeitz, a lawyer for Klinman, declined to comment yesterday.

The indictment also alleges that Atchildiev and Universal Pharmacy Solutions shipped approximately 184,070 prescriptions to Rx Medical One customers between August 2003 and May 2004, mostly for controlled substances.

Atchildiev and his pharmacy received approximately $8.2 million from Rx Medical One for filling and shipping prescriptions to Rx Medical One's online customers. Some of that money also went to Gem Pharmacy, a now-defunct pharmacy run by Atchildiev, the feds said.

Patrick Egan, an attorney for Universal Pharmacy Solutions, said yesterday the company is reviewing the charges and determining how to proceed. Nick Centrella, a lawyer for Atchildiev, was unavailable for comment.

In an unrelated indictment, a federal grand jury charged a Huntingdon Valley osteopath, Albert Kofsky, with trafficking in massive quantities of diet pills from an office on Birch Road in Northeast Philadelphia.

The grand jury charged that Kofsky, 73, made more than $8.7 million in illegal sales.

The feds charged that over the past decade, Kofsky sold 10,000 to 15,000 diet pills a week for $2 per pill and tried to convince government regulators, suppliers and others that he was dispensing the pills as part of a legitimate medical practice.

But the charging papers said Kofsky sold the diet pills, which cost him a dime each, on a first-come, first-served basis, to anyone with the cash to buy them.

The feds also charged Kofsky attempted to evade federal currency reporting requirements for large cash transactions by making cash deposits into his business account in increments of less than $10,000.

The feds also want Kofsky to forfeit cash, a 1989 Rolls-Royce and his interest in two properties at a luxe Mexican spa and golf resort.

Kofsky's attorney, Creed Black, said he hadn't seen the indictment yet but that Kofsky intended to plead not guilty and defend himself.