LITTLE ROCK -- Testimony from the man described as the "quarterback" of a team of pharmaceutical sales representatives, physicians and patients responsible for millions of dollars in fraudulent compounding prescriptions billed to the military insurer Tricare dominated the second day of testimony in the trial of an Alexander doctor for writing many of those prescriptions.
Dr. Joe David May, also known as "Jay May," is on trial after being indicted federally on charges of conspiracy, wire fraud, mail fraud, violating the anti-kickback statute, aggravated identity theft, lying to the FBI, and falsifying records in the federal investigation. May was originally charged in January 2020 with 43 counts of fraud, obstruction and other federal charges along with Derek Clifton, a former Baxter County basketball coach, in a 41-page indictment.
On the stand Thursday and much of Friday was Albert Glenn Hudson of Little Rock, a former pharmaceutical sales representative who federal prosecutors said was responsible for coordinating the conspiracy that was responsible for some $12 million in fraudulent compounded prescriptions for pain creams, scar creams and supplements in 2015 that were generated in Arkansas through a Mississippi compounding pharmacy.
In testimony Thursday Hudson said Tricare was targeted "because it was one of the only insurance companies paying for compounded drugs."
According to the U.S. Food and Drug Administration, drug compounding is the process of combining, mixing, or altering ingredients to create a medication tailored to the needs of an individual patient. Compounding includes the combining of two or more drugs. Compounded drugs are not FDA-approved.
On Friday, Hudson testified that in mid-2015, following an expose on Tricare fraud by CBS, he began instructing his "team" to provide the names of the physicians who were prescribing their compounded drugs so that if they were contacted by the pharmacy they could act as though they had a relationship with the prescribing physician or nurse practitioner.
"Why were you lying to the pharmacy?" asked Assistant U.S. Attorney Alex Morgan.
"Because if the pharmacy says they're not seeing patients in clinics, they can cancel the contract and stop doing Tricare prescriptions for us," Hudson said.
Hudson said he learned that May had been approached by FBI agents investigating the fraud from Clifton in January 2016 a few days after he learned that Donna Crowder, a nurse practitioner at the North Little Rock Veterans Administration hospital, had been interviewed by the FBI, and that the compounding pharmacy in Mississippi had been raided.
Hudson said he had been providing payments to Crowder's daughter, Jennifer, in exchange for Donna Crowder rubber stamping prescriptions for him. Both Donna Crowder and Jennifer Crowder pleaded guilty to violating the federal anti-kickback statute in July 2020 before U.S. District Judge Lee Rudofsky.
Hudson said he met with Clifton on Jan. 26, 2016 at a Sonic Drive-in on Colonel Glenn Road to talk about the developing investigation.
"That was the first I heard that he was giving doctors money," Hudson said.
Under cross examination by May's attorney, Shelly Koehler, Hudson named over a dozen people he said were part of his team that was responsible for recruiting Tricare beneficiaries for prescriptions. Asked what Clifton's role was, Hudson said he did not recruit Clifton. He said Clifton had come to him telling him he had a long-time friend -- May -- who was a doctor and could sign prescriptions.
Asked how May's signature would be obtained, Hudson said, "I would have gotten it from Derek."
Also on Friday, the jury of seven men, five women and one alternate heard from Betty Maxwell of Vilonia, who testified that both she and her husband, Joseph, had been signed up to receive prescriptions by her grandson. When she received the prescriptions in the mail, she said, she returned them.
"I've never heard of these medications," Maxwell said. "I never ordered them or refilled them."
She said she had never consulted with or talked to May about the prescriptions, that she had never met him and he never contacted her.
"It didn't even look like medicine," she said of the products she received. "It looked like lotion. I didn't even open the second one. I wrote 'return to sender' and put them by the front door."
Asked about the cost of the prescriptions, Maxwell said she didn't remember for certain but that she remembered it was a considerable amount.
"It seems like it was around $50,000," she said. "It's been a long time and I don't remember, but it was outrageous."
When testimony resumes on Monday, Assistant U.S. Attorney Stephanie Mazzanti said the government's case will continue with plans to call nine witnesses to the stand, including co-defendants Donna Crowder and Keith Benson.