Dr. David J. Smith, a pain management physician, and his office manager, Julia Ann Oertle, are charged in a federal grand-jury indictment with perpetuating a long-running scheme to commit healthcare fraud and to manufacture and distribute adulterated fentanyl.

After his initial appearance in federal court, Smith’s bond was set at $1 million, secured by real property, with a limitation on his ability to practice medicine. Oertle was still at large.

According to allegations in the indictment, Smith purports to specialize in the installation and maintenance of intrathecal pain pumps which are surgically placed in a patient’s stomach with two catheters implanted on the spine; pain medicine is then infused into a reservoir in the pump periodically, and meted out directly into the spine.

Beginning in December 2017, Smith and Oertle began compounding fentanyl citrate into vials, in a room at Smith’s principal medical practice, San Diego Comprehensive Pain Management Center. According to the indictment, this compounding practice was grossly improper and resulted in the production of adulterated fentanyl. Smith nevertheless directed administration of this fentanyl to patients repeatedly.

The indictment alleges that beyond providing patients with adulterated fentanyl, Smith violated the applicable standards of care by, among other things, prescribing materially excessive quantities of fentanyl, prescribing unnecessary oral opioid medications in conjunction with pain-pump medication, and installing pain pumps in patients without proper assessments for patient need.

Smith then had false and fraudulent reimbursement claims submitted to Medicare for these administrations. Among other things, the claims were inflated by nearly 60 percent; they sought reimbursement for large volumes of unnecessarily manufactured fentanyl; they falsely represented that excess fentanyl had been discarded, when in fact it was used; and they did not disclose that the fentanyl was adulterated.

According to the indictment, Oertle illegally ordered fentanyl citrate for compounding; compounded fentanyl with Smith; and helped direct the illegal billing practices.

Smith has bad disciplinary charges brought against him by licensing authorities in both California and Nevada.

In June 2022 the Board of Medical Examiners of the state of Nevada, in disciplinary case 22-47823-1, alleged that Smith filed an application to practice medicine with them in September 2017. He was asked if he had ever been investigated by any other medical licensing board, and he answered “no” to that question. However, they claim he was “repeatedly” investigated by the California Medical Board prior to his application with them. Additionally he allegedly had malpractice cases pending against him that he did not disclose.

In proceedings before the California board, a final order and Decision dated August 25, 2020, in Case No. 800- 2015-013651, the California Board found that Smith committed acts of gross negligence, repeated negligent acts, failed to maintain adequate and accurate medical records, and unprofessional conduct in the care and treatment of multiple patients. The California Board found Smith incompetent in the care and treatment of a patient, and that he excessively prescribed controlled substances to three (3) patients.

Effective October 15, 2020, the California Board revoked Smith’s license to practice medicine in the State of California, with the order stayed, and he was placed on probation for seven (7) years subject to numerous terms and conditions.

In a subsequent California matter, a final order and Decision dated December 22, 2021, in Case No. 800-2018-042234, the California Board found that Smith committed acts of gross negligence in the care and treatment of three (3) patients, repeated negligent acts, excessively prescribed controlled substances, and failed to maintain adequate and accurate medical records in the care and treatment of two (2) patients, and unprofessional conduct.

Effective January 21, 2022, the California Board again revoked Respondent’s license to practice medicine in the State of California, with that order stayed, and was placed on probation for the duration of Respondent’s probation in the prior matter, Case No. 800-2015-013651, until the anticipated end date of October 14, 2027, subject to additional terms.