Pharmacy Supplier Enters Guilty Plea in $7.2-Million Fraud : Medi-Cal: The Valencia businessman admits making phony billings. He gets a 44-month sentence.

The owner of a Valencia pharmaceutical supply company pleaded guilty to defrauding Medi-Cal out of $7.2 million through phony billings, one of the largest such cases in the agency’s history, the state attorney general’s office said Friday.

Roy Pacia, 51, owner and president of Bruce Pharmacal Inc., entered the plea Thursday before Municipal Judge Candace Beason to two felony counts of defrauding the state’s Medi-Cal program, said Deputy Atty. Gen. Henry Torres Jr.

Under the agreement, Pacia will serve 44 months in state prison, pay $5 million in restitution to the state and cooperate with state investigators in further inquiries into Medi-Cal fraud, Torres said.

The case may be the second largest Medi-Cal fraud case in state history, Torres said. The largest involved more than $20 million in bogus billings, he said.

Pacia, one of five figures charged in the case, masterminded a three-year scheme under which the company defrauded the state through overbilling, billing the state for products not prescribed by physicians and charging Medi-Cal for products not covered by the state health program, Torres said.

Bruce Pharmacal submitted groundless claims for supplies supposedly delivered to elderly and disabled Medi-Cal beneficiaries, he said. Nearly all the billings involved diapers supposedly supplied to elderly Medi-Cal patients and others suffering from incontinence.

The company induced Medi-Cal recipients in South-Central and East Los Angeles to turn over state-supplied stickers--which providers of medical services can exchange for payment from Medi-Cal--in return for cheap promotional gifts, Torres said.

After he was indicted by the state in December, Pacia fled to his native Philippines.

He returned voluntarily May 16 and since then has cooperated with investigators, Torres said.

In Pacia’s absence, the FBI seized $1.7 million of his personal and business assets, including the company’s office and Pacia’s three houses.

The federal government is involved because Washington helps finance the Medi-Cal program.

“Part of the plea agreement is that he must help us find out where all the money went,” Torres said. “He’ll sign over all of his assets and the assets of Bruce Pharmacal.”

The company has filed for bankruptcy under Chapter 11 of the federal code, which could complicate the restitution requirement.

“Whether or not we’re going to collect the full $5 million is unclear,” Torres said. “It could ultimately be determined by a bankruptcy judge.”

Macario Tiu Sr. of Valencia, Eliseo Sur of Granada Hills, Carol Dunbar of Newhall and Elisa Cabuntala of Los Angeles also were charged with taking part in the alleged fraud while they worked at Bruce Pharmacal.

Tiu, a vice president of the company, pleaded guilty to one count of receiving unlawful remuneration for Medi-Cal stickers and was sentenced Thursday to 81 days in county jail and to pay as much as $15,000 in restitution, Torres said.

Tiu illegally collected thousands of Medi-Cal stickers in South-Central and East Los Angeles, Torres said, and was paid about $10 to $15 per sticker by Bruce Pharmacal.

“He collected more than Bruce Pharmacal could process--there was a backlog,” Torres said.

The company would then turn around and bill the state for about $75 to $100 per sticker--which is a small amount for Medi-Cal fraud cases, Torres said.

“They were trying for quantity as opposed to maximizing profit per sticker,” he said.