March 29, 09

NEWS / Major Figure in Rogue Internet Pharmacy Case Sentenced

Lead Defendant Rakesh Jyoti Saran to be Sentenced Next Month for Role in Conspiracy that Involved More Than $200 Million in Fraudulently Obtained Pharmaceuticals

DALLAS—Steven Rosner, a defendant and key figure in a major internet pharmacy fraud case, was sentenced yesterday by U.S. District Judge Jorge A. Solis to 33 months in federal prison, announced acting U.S. Attorney James T. Jacks of the Northern District of Texas. Judge Solis also ordered that Rosner pay $400,000 in restitution and forfeit $385,721.18. Rosner, 56, pled guilty in October 2006 to one count of conspiracy to distribute controlled substances. He was arrested at his home in Boca Raton, Florida, on September 21, 2005, on charges outlined in an indictment returned by a federal grand jury in Dallas the previous day. He is currently on bond and living in Pennsylvania. Judge Solis ordered that he surrender to the Bureau of Prisons on July 8, 2009.

From his residence on NE Marine Drive in Boca Raton, Rosner set up and operated Internet Facilitation Centers (IFCs), www.offerpills.com and www.clickonmed.net, to facilitate the distribution of controlled substances. Internet customers would log onto either of the sites and order controlled substances, paying by credit card, paypal, cashier’s checks, or money orders. Many of the Internet customers paid cash on delivery.

Rosner, and co-defendant Rakesh Jyoti Saran, of Arlington, Texas, (formerly of Boca Raton) conspired together and with others to distribute, and possess with the intent to distribute, controlled substances to Rosner’s Internet customers without legitimate prescriptions. Rosner admitted that he knew that the substances would be distributed to Internet customers without legitimate prescriptions and without the existence of a doctor-patient relationship. He knew that the distributions were outside the scope of professional practice and not for a legitimate medical purpose.

To facilitate the conspiracy, Rosner paid several doctors, Drs. Arceli Rodriguez-Soto, Carlos Ortiz, and Maileen Lugo-Torres, all licensed and located in Puerto Rico, to approve the Internet customers’ orders.

Rosner paid Rakesh Saran to fill the drug orders through one or more of Saran’s 23 pharmacies that were located in North Texas. Once the drug orders were filled, Rosner and Saran coordinated the shipments to the drug users. Saran started filling these drug orders, which consisted of controlled and non-controlled substances, in May 2005 and continued until September 21, 2005, when he too was arrested on charges outlined in the 201-count federal indictment.

Rakesh Jyoti Saran, who pled guilty in November 2006 to one count of conspiracy to commit health care fraud and other federal offenses, two counts of mail fraud, and one count of conspiracy to distribute controlled substances, is scheduled to be sentenced by Judge Solis on Wednesday, April 15, 2009. He faces a maximum statutory sentence of 20 years in prison, a $1 million fine and will be required to forfeit assets earned from his illegal activities, including more than $1 million in cash seized at his residence; more than $375,000 found in bank accounts; several vehicles; and a custom home under construction in Arlington, Texas. In addition to his own guilty plea, Saran entered guilty pleas on behalf of twenty corporations he controlled and used in the criminal conspiracy.

All of the 19 individuals charged in the 201-count indictment have pled guilty and most have been sentenced.

Rosner admits that the amount of controlled substances he illegally distributed through his websites, beginning in June 2004 and continuing through September 21, 2005, when he was arrested, exceeded 40,000 pills of hydrocodone (an addictive painkiller); 40,000 pills of phendimetrazine (an appetite suppressant); 40,000 pills of alprazolam (used to treat anxiety, depression, panic disorder and premenstrual syndrome); and 40,000 pills of phentermine (an appetite suppressant).

The case was investigated by the U.S. Food and Drug Administration - Office of Criminal Investigations; Federal Bureau of Investigation; Drug Enforcement Administration; Internal Revenue Service - Criminal Investigation; U.S. Department Social Security Administration - Office of the Inspector General; U.S. Department of Veteran Affairs - Office of the Inspector General; Texas Department of State Health Services and the Texas State Board of Pharmacy.

The case is being prosecuted by Assistant U.S. Attorneys Candina Heath, John de la Garza, and Chad E. Meacham.

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