Pharmaceutical Firm’s Owner Gets 44 Months for Medi-Cal Fraud

The owner of a Valencia pharmaceutical supply company was sentenced to nearly four years in prison and ordered to repay $5 million after defrauding Medi-Cal out of $7.2 million, the third largest such case in the agency’s history, the state attorney general’s office said Friday.

Roy Pacia, 51, owner and president of Bruce Pharmacal Inc., was sentenced Thursday by Superior Court Judge Clarence A. Stromwall on two felony counts of defrauding the state’s Medi-Cal program through phony billings. Pacia had earlier reached a plea agreement with the state, Deputy Atty. Gen. Henry Torres Jr. said.

In addition to a 44-month sentence in state prison and restitution, Pacia has agreed to cooperate with state investigators in further probes of Medi-Cal fraud, Torres said.

“He agreed to show us where all the money went,” Torres said. “He has already signed over his assets, including three promissory notes worth about $500,000 and the assets of Bruce Pharmacal, to us.”

But the state may not be able to recover the entire amount, he said, because of Pacia’s tangled finances.

“We’re pretty certain of recovering at least $2 million from Pacia,” Torres said. “There is no certainty that we will recover anything beyond that.”

In December, the FBI seized $1.7 million in Pacia’s personal and business assets, including the company’s office, a warehouse and his three homes.

Bruce Pharmacal is in bankruptcy, which could complicate the restitution payment. The government maintains that company accounts consisted almost entirely of funds obtained through fraudulent Medi-Cal payments.

Pacia’s real estate is “mortgaged to the hilt,” and the state may have to wait in line with other creditors, which include banks and other businesses, Torres said.

Pacia masterminded a three-year scheme in 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.

Bruce Pharmacal submitted phony claims for supplies that were never delivered to elderly and disabled Medi-Cal beneficiaries. Nearly all of the billings involved supplying diapers to elderly Medi-Cal patients and others who suffered from incontinence.

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