A South Florida man who made a profit of at least $200,000 participating in a years-long fraud scheme involving prescription drugs was sentenced Monday to over seven years in federal prison.
Eladio Vega, 37, pleaded guilty in May to one count of conspiracy to traffic misbranded and adulterated drugs and received a sentence on the lower end of the range, having faced a maximum sentence of 15 years on the charge, according to federal court records. Vega was initially facing several others charges which were later dismissed.
Vega is one of 17 defendants who were indicted in the scheme, 15 of who pleaded guilty and have been sentenced to prison with the exception of a corporation that was required to pay a $78 million forfeiture, federal prosecutors said in a news release Tuesday.
The scheme centered around the business of “diverted pharmaceuticals,” which means prescription medications were bought and sold illegally, obtained through health care fraud or purchased from people who had the prescriptions but chose to sell them instead, according to Vega’s factual proffer. The diverted drugs are then resold to retail pharmacies with fraudulent documentation claiming the drugs were supplied from manufacturers or legitimate pharmaceutical companies directly.
Prosecutors said the defendants also got the prescription medications through theft or burglary. They were primarily drugs designed to treat HIV, psychological disorders and cancer, court documents said.
“In turn, the retail pharmacies sold the medications to patients who did not know the real source of the drugs, which had been stored and transported with no regard to temperature, light, humidity, or other maintenance controls,” prosecutors said in the news release.
Vega acted as an assistant to co-defendant Lazaro Hernandez, who was supplying the prescription drugs to another co-defendant Stephen Costa between 2013 and mid-2016, according to the factual proffer. Costa then arranged for the delivery of the prescriptions to other co-defendants through shell companies to hide the scheme and those who were profiting from it.
In January 2017, Vega was among a group of the conspirators who met at the 1 Hotel in South Beach where he met Joshua Joles, whom the conspirators had been selling most of the prescription drugs to, the factual proffer said. Joles ran a limited liability company in Arizona.
Vega told Joles that his “godfather” Hernandez could supply large quantities of the same drugs he was buying from others, along with the fraudulent documents, for 17% below the wholesale price, the factual proffer said. Joles agreed to deal directly with Hernandez and Vega, cutting out the previous middle men.
“Vega was paid a commission on each of the sales of diverted pharmaceuticals that were made by the companies that he had connected to do business with Joles. As a result, he directly profited in the amount of at least $200,000 from his role on the offense,” the court document said.
The factual proffer said the amount of diverted drugs Joles paid for that were sourced from Vega and Hernandez totaled $33 million.
After Vega serves his sentence, he will be on supervised release for three years, prosecutors said. Court records say he will have to participate in a 500-hour drug and alcohol treatment program and will surrender himself no later than noon on Aug. 23.
