United States Drug Enforcement Administration

MANHATTAN, N.Y. - James J. Hunt, Special Agent in Charge of the U.S. Drug Enforcement Administration’s New York Field (DEA), Preet Bharara, the United States Attorney for the Southern District of New York, and William J. Bratton, the Police Commissioner of the New York City Police (NYPD), today announced the unsealing of an Indictment against 11 participants in a massive illegal drug distribution ring involving the prescription painkiller oxycodone.  As detailed further below, the distribution ring operated out of purported medical clinics in Manhattan and the Bronx, including the office of Moshe Mirilishvili, a Board certified, state licensed doctor, who alone wrote more than 13,000 medically unnecessary prescriptions for oxycodone in a two-year period, resulting in the unlawful distribution of nearly 1.2 million oxycodone tablets.  The scheme also involved drug traffickers who oversaw crews of “patients” sent into the clinics to obtain medically unnecessary oxycodone prescriptions so that the pills could be obtained and resold, and clinic staff who profited by selling access to Mirilishvili and the fraudulent prescriptions he wrote.  

Nine of the 11 defendants were arrested this morning in connection with the charges unsealed today and are expected to be presented before U.S. Magistrate Judge Kevin N. Fox later this afternoon.  Defendants Ganeene Goode and Kevin Frye remain at large.

DEA Special Agent in-Charge James C. Hunt said: “As alleged, these defendants are drug dealers playing doctor.  They use nicknames, roles and an organizational hierarchy that mimics street drug trafficking crews.  Instead of providing legitimate medical examinations or treatment, Dr. Mirilishvili and his office staff allegedly took payments from drug chiefs, drug crews and ‘patients’ in exchange for oxycodone prescriptions used to fuel the spread of opioid abuse throughout New York City.”

Manhattan U.S. Attorney Preet Bharara said: “As alleged, Moshe Mirilishvili violated the oath of his profession and flouted the law to write more than 13,000 medically unnecessary prescriptions for oxycodone.  He and his co-defendants, motivated by greed, allegedly conspired to enrich themselves by flooding the illicit market for this highly addictive and dangerous drug.”

NYPD Commissioner William J. Bratton said: “Dr. Mirilishvili not only made millions in illegal profits, he contributed to the growing addiction of oxycodone. Today’s arrests will help prevent more illegally prescribed prescription pain killers from reaching our streets and will hopefully improve quality of life for the residents who live on the same blocks as these pseudo medical facilities.  I want to thank the investigators, agents and prosecutors involved in bringing this drug distribution network to justice.” 

The following allegations are based on the Indictment unsealed today in Manhattan federal court:

Oxycodone is a highly addictive, prescription-strength narcotic used to treat severe and chronic pain conditions.  Every year more than 13 million Americans abuse oxycodone, with the misuse of prescription painkillers such as oxycodone leading to as many as 500,000 annual emergency room visits.  Oxycodone prescriptions have enormous cash value to street level drug dealers, who can fill the prescriptions at most pharmacies and resell the resulting pills at vastly inflated rates.  Indeed, a single prescription for 90 30-milligram oxycodone pills has an average resale value in New York City of $2,700 or more.

From approximately January 2012 until December 2014, the drug distribution ring operated at various purported medical clinics in Manhattan and the Bronx, including the office of the defendant Moshe (the “Clinic”), where Mirilishivili, a Board certified, state licensed doctor, wrote thousands of medically unnecessary prescriptions for large quantities of oxycodone in exchange for cash payments.   Mirilishvili typically charged $200 in cash for “patient visits” that typically involved little, if any, actual examination and almost always resulted in the issuance of a prescription for a large quantity of oxycodone, typically 90 30-milligram tablets.   

Virtually none of these “patients” had any medical need for oxycodone, nor any legitimate medical records documenting an ailment for which oxycodone would be prescribed. Instead, most of these individuals were members of “crews” - that is, they were recruited and paid by drug (the “Crew Chiefs”), to pose as “patients” in order to receive medically unnecessary prescriptions.  The Crew Chiefs then obtained these prescriptions and arranged for them to be filled at various pharmacies so that the oxycodone pills thereby obtained could be resold on the streets of New York.  

Various Clinic employees participated in and profited from the scheme, charging Crew Chiefs cash fees for scheduling “patient visits” necessary to obtain these oxycodone (the “Office Staff”).   The Office Staff also profited by creating fake documents such as MRI reports purporting to reflect injuries or urinalysis reports ostensibly documenting that the patient was taking rather than selling the oxycodone, all of which Mirilishvili would frequently request in an effort to avoid the attention of law enforcement.

In total, between October 2012 and December 2014, Mirilishvili wrote more than 13,000 medically unnecessary prescriptions for oxycodone, comprising nearly 1.2 million oxycodone tablets with a street value of $36,000,000 or more.  Mirilishivili collected more than $2.6 million in fees for “doctor visits” during this time period.  

To maximize their profits, many of the Crew Chiefs involved in this scheme also sent their “patients” to see other doctors operating out of similar fraudulent medical clinics, including a clinic on Southern Boulevard in the Bronx, New York, and a clinic in Upper Manhattan.   Between January 2012 and the present, doctors at these clinics wrote more than 35,000 oxycodone prescriptions, virtually none of them medically necessary,  resulting in the unlawful distribution of millions of oxycodone tablets.
           
All of the defendants are charged with one count of conspiracy to distribute and possess with intent to distribute oxycodone.  This offense carries a maximum sentence of 20 years in prison.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.
A chart containing each defendant’s age and residence information is included below.  The case is assigned to U.S. District Judge Colleen McMahon.
U.S. Attorney Bharara praised the investigative efforts of the Drug Enforcement Administration’s Tactical Diversion (Group TDS-NY), which led this two-year investigation, and thanked the New York State Department of Financial Services and the Hackensack, New Jersey, Police Department for their assistance in the investigation.  DEA’s Group TDS-NY consists of agents and officers from the DEA, the New York City Police Department, the Town of Orangetown Police Department, and the Westchester County Police Department.  Mr. Bharara also noted that the investigation is ongoing.
           
The case is being prosecuted by the Office’s Narcotics Unit.  Assistant U.S. Attorneys Edward B. Diskant and Brooke E. Cucinella are in charge of the prosecution. 

The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

1. Defendants’ Ages and Residences