Doctor accused in MS pain cream scheme set to plead to lesser charge

A Meridian doctor who stood trial in 2020, accused of eight felony charges in the Mississippi pain cream scheme, is expected to plead guilty to a lesser charge Monday in federal court, according to court documents filed last week.

Dr. Gregory Auzenne, 51, was accused of causing around $18 million in fraud in a nationwide scheme that defrauded TRICARE and other health benefits providers of more than $515 million in Mississippi alone. He had been acquitted on all but one charge.

The charges in Auzenne’s original indictment included violating the federal anti-kickback statute, three wire fraud charges, three conspiracy charges and making false statements relating to healthcare matters.

Click here to read Auzenne’s notice to the court of his intent to plead guilty.

Click here to read the new allegations and misdemeanor charge against Dr. Gregory Auzenne.

Auzenne is scheduled to appear in federal court in Hattiesburg on Monday for a change-of-plea hearing in which he is expected to plead guilty to a misdemeanor charge of fraudulent failure to disclose information involving federal health care programs.

Auzenne stood trial in November 2020 with his then-office manager Tiffany Clark, who was indicted with Auzenne on five of the eight charges. She was acquitted of all charges after a two-week trial. The doctor was acquitted of seven of the eight charges, but the jury could not come to a decision on the eighth felony charge — making false statements.

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By pleading guilty to a misdemeanor, Auzenne will avoid going to trial again on the eighth charge. He faces up to one year in prison and a $20,000 fine and must forfeit roughly $116,600.

It is unclear how the government arrived at that amount.

Another defendant in the case, former pharmacist Marco Moran, testified at Auzenne’s trial he gave the doctor a check for $127,000, which Auzenne said was for consulting fees, but Moran and others testified was for kickbacks for Auzenne’s signature on preprinted prescription forms for the compounded medicines that were used in the fraud.

Auzenne testified at his 2020 trial, claiming he had no connection with Moran outside of the two men being in the same fraternity in college and a $40,000 loan Auzenne made to Moran to open Custom Care Pharmacy.

Moran, however, said the pharmacy was opened to process the fraudulent prescriptions for the pain creams and other medications.

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Auzenne denied he had any financial stake in Custom Care or any of the other pharmacies to which his prescriptions were faxed.

Auzenne and Moran also shared offices at the same address on East Northside Drive in Clinton.

Moran and roughly 20 others were convicted at trial or pleaded guilty to their roles in the massive health care fraud that nationwide bilked TRICARE and other health care benefits providers of more than $1.5 billion.

The fraud involved a complicated web of perpetrators that on one end recruited doctors and nurse practitioners to prescribe high-priced pain and scar creams, vitamin supplements and other compounded medications, some of which cost upwards of $13,000 apiece.

On the other end, patients were prescribed the medications, some of whom were never examined by a physician, even though some of the medications included controlled substances.

In between, compounding pharmacies in Mississippi and across the nation were mass-producing the medications. The formulas for the medications were designed to maximize reimbursement dollars. Compounded medications are supposed to be formulated for individual patients for specific medical needs.

Who was involved in the Mississippi cases?

Guilty, sentenced

• Mitchell “Chad” Barrett, 10 years
• Doyle Beach: 13 years
• Freda Covington: 1½ years, released Jan. 14, 2022
• Albert Diaz: 3½ years; released April 23, 2020
• Dempsey “Bryan” Levi, 7 years
• Jason May: 1 year, 1 day, released July 30, 2021
• Marco Moran: 10 years
• Brantley Nichols: 1 year, 1 day, released Sept. 24, 2021
• Fallon Page: 1½ years, released Nov. 26, 2021
• Gregory Parker: 1½ years, released Jan. 14, 2022
• Susan Perry: 3½ years, released Oct. 28, 2020
• Silas Richmond: 1 year, 4 months; released May 27, 2020
• Jeffrey Rollins, 7 years
• David “Jason” Rutland, five years
• Jay Schaar: 2 years, 3 months; released March 20, 2020
• Thomas “Tommy” Wilburn Shoemaker, 2½ years, anticipated release date, Nov. 15, 2023
• Charles “Chandler” Smith, 5 years of probation
• Thomas Spell: 10 years
• Thomas Sturdavant: 2 years, released Jan. 14, 2022
• Shahjahan Sultan: 4 years, released Sept. 15, 2022
• Hope Thomley: 14 years
• Randy Thomley: 8 years
• Wade Walters: 18 years
• Joseph Wiley: 3 years, released June 9, 2022

Acquitted

• Tiffany Clark was found not guilty of all charges in November 2020.
• Dr. Gregory Auzenne (found not guilty of seven charges in his November 2020 trial. He is expected to plead guilty Monday in federal court to a misdemeanor charge related to the pain cream fraud)

Do you have a story to share? Contact Lici Beveridge at lbeveridge@gannett.com. Follow her on Twitter @licibev or Facebook at facebook.com/licibeveridge.

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