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A Florida man who once was the director of operations at a now-shuttered Irvine pharmacy was sentenced to 114 months in federal prison for his role in a scheme in which kickbacks were paid for prescriptions for “compounded” medications – a scam that cost Tricare, the United States military’s health care plan, more than $3 million in losses.

Marcus Orlando Armstrong, 56, of Miami, was sentenced by United States District Judge Otis D. Wright II, who also ordered Armstrong to pay $3,070,091 in restitution.

Armstrong pleaded guilty in October 2022 to two counts of paying illegal kickbacks for health care referrals.

Armstrong was the director of operations for the now-defunct Irvine Wellness Pharmacy, which made compounded medications. Compounded drugs are tailor-made products doctors may prescribe when the Food and Drug Administration-approved alternative does not meet the health needs of a patient.

In mid-2014, Armstrong agreed to pay a physician, identified in court documents as “N.G.,” kickbacks in exchange for prescriptions bearing N.G.’s name and credentials. Armstrong intended that Irvine Wellness Pharmacy would fill the prescriptions and Tricare would pay to reimburse them. Armstrong further intended to receive a portion of the reimbursements and then, out of those funds, Armstrong intended to pay kickbacks to N.G.

In February 2015, Armstrong wrote two checks – one for $16,418 and the other for approximately $10,000 – to N.G. that were noted as being for “marketing.” In fact, the checks were illegal kickback payments to N.G. in exchange for prescriptions that were not medically necessary.

A co-defendant, Sandy Mai Trang Nguyen, 42, of Irvine, was found guilty by a jury in November 2022 of 21 counts of health care fraud and one count of obstruction of a federal audit. Nguyen was the pharmacist-in-charge at Irvine Wellness Pharmacy.

According to evidence presented at Nguyen’s trial, from late 2014 to May 2015, Nguyen and others under her supervision filled approximately 1,150 compounded prescriptions for pain, scarring and migraines that Tricare reimbursed for tens of thousands of dollars per prescription. Nearly all the prescriptions were sent to the pharmacy by so-called marketers who were paid kickbacks of nearly half of the Tricare reimbursements paid to the pharmacy.

The beneficiaries were solicited to provide their Tricare insurance information for medications they did not seek out or need, and most were never examined by a physician. The prescriptions were electronically sent from marketers or telemedicine businesses and submitted by the pharmacy for reimbursement even though Tricare rules excluded reimbursements for claims based on telemedicine visits and would not, in any event, have been authorized had Tricare known the prescriptions originated based upon the payment of kickbacks.

Nguyen’s sentencing hearing is scheduled for April 3.

Co-defendants Leslie Andre Ezidore, 53, of West Los Angeles, and Alexander Michael Semenik, 51, of Las Vegas, have pleaded guilty to felony charges in this case and await sentencing.