The U.S. Department of Justice (DOJ) has unsealed charges against 13 individuals, including pharmaceutical distributor executives, sales representatives, and brokers, in connection with the unlawful distribution of nearly 70 million opioid pills and more than 30 million doses of other commonly abused prescription drugs.
“The defendants, including pharmaceutical drug distributors, allegedly exploited the opioid crisis for profit—selling dangerous and addictive drugs to pill-mill pharmacies at above-market prices, knowing that the drugs would end up on the black market,” said Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the DOJ’s Criminal Division. “Our message is clear: we will not hesitate in our pursuit of those involved in dumping addictive pharmaceutical drugs onto the streets.”
According to court documents, the defendants targeted pill-mill pharmacies in and around Houston, a region recognized as a “hot zone” for the diversion of pharmaceutical opioids onto the black market.
The distributors allegedly sold opioids such as oxycodone, hydrocodone, and hydromorphone almost exclusively in their most abused, immediate-release pill forms, which commanded the highest prices on the black market.
They also sold prescription drug potentiators such as alprazolam, carisoprodol, and promethazine with codeine syrup, known to enhance the high from opioids.
“The defendants in the charges announced today are alleged to be responsible for significantly contributing to the devastation caused by the opioid crisis by knowingly supplying pill-mill pharmacies and coaching pharmacy operators on how to evade law enforcement detection,” DEA Administrator Anne Milgram said in the statement.
The distributors allegedly sought to thwart the DEA’s oversight by following a so-called “blueprint” for avoiding detection, which included high prices, low purchasing limits for controlled drugs, and compliance measures that only served appearances.
They were located outside Texas, in states such as Arizona, Florida, Maryland, California, North Carolina, and Tennessee, but targeted Houston-area pharmacies due to the high demand and profits.
“This office will always support the prosecution of individuals who try to thwart law enforcement and oversight by operating across state lines, posing as legitimate businesses, while in reality poisoning our district by targeting pill mills with precisely the drugs at the heart of our country’s addiction crisis,” U.S. Attorney for the Southern District of Texas Alamdar S. Hamdani said of the operation.
The charged individuals include five pharmaceutical distributor executives: Sheldon Dounn, 71, of Plantation, Florida, charged with unlawfully distributing controlled substances and conspiracy to defraud the United States (charges unsealed); Richard “Dick” Osbourne, 78, of Memphis, Tennessee, charged with conspiracy to unlawfully distribute controlled substances (pleaded guilty); Hernan Alvarez, 52, of Phoenix, charged with conspiracy to unlawfully distribute controlled substances involving more than 18.6 million opioid units (pleaded guilty); Joshua Weinstein, 50, of Miami, charged with conspiracy to unlawfully distribute controlled substances related to more than 7 million opioid pills (pleaded guilty); and Eric Bailey, 59, of St. Louis, charged with possession with intent to distribute hydrocodone and oxycodone involving over 11 million pills (pleaded guilty).
Also charged were five pharmaceutical sales representatives and brokers: Courtney Rotenberry, 45, of Savannah, Tennessee, charged with conspiracy to defraud the United States and conspiracy to use a communications facility to further a drug felony (pleaded guilty); Derrick “Chad” Atkinson, 40, of Lumberton, North Carolina, charged with conspiracy to unlawfully distribute controlled substances involving more than 7 million opioid pills (charged by information); Jason Smith, 43, of Plantation, Florida, charged with conspiracy to unlawfully distribute controlled substances (pleaded guilty); Joseph Pesserillo, 38, of The Villages, Florida, charged with conspiracy to use a communications facility to further a drug felony (charged by information); and Cassandra Rivera, 40, of Ft. Lauderdale, Florida, charged with conspiracy to use a communications facility to further a drug felony (charged by information).
Three Houston-area pharmacy operators charged included Velencia Griffin, 42; Kendal Lyons, 29; and Andre Reid, 44, charged with conspiracy to unlawfully distribute controlled substances (pleaded guilty).
The assistant commissioner for the FDA’s Office of Criminal Investigations, Justin Green, said: “Supplying diverted prescription drugs undermines FDA safeguards designed to protect the public, compromising public safety for personal gain. This investigation is a clear demonstration that the FDA will not stop pursuing and bringing to justice those who put the public health at risk.”
“Our efforts have not only resulted in these charges but also in the seizure of over $22 million in cash, firearms, jewelry, and other assets,” she said. “We’ve issued 28 immediate suspension orders and eight orders to show cause to halt illegal distribution channels.
“By bringing charges against key figures, including top-level executives, we are sending a clear and powerful message: No one is above the law. If you contribute to the opioid epidemic, if you profit from the devastation of our communities, we will hold you accountable.”
