FBI Pulls the Plug on an Illegal Internet Pharmacy

Assistant Attorney General Alice S. Fisher of the Criminal Division and U.S. Attorney Karen P. Hewitt for the Southern District of California have announced that the owner of a pharmacy in Florida, Claude Covino, 55, of Del Ray Beach, and a doctor from Kentucky, Subramanya K. Prasad, M.D., 40, of London, Kentucky, have both pleaded guilty to conspiracy for the parts they played in an Internet pharmacy business. The business brought in more than $126 million from the illegal sale of prescription medicines.

Covino pleaded guilty to one count of conspiracy to commit money laundering and one count of conspiracy to illegally distribute controlled substances. He has also agreed to forfeit $831,560.

Prasad pleaded guilty to one count of conspiracy to illegally distribute controlled substances. He agreed to forfeit $95,994.

Covino admitted that he was part-owner of Saveon RX Pharmacy in Florida. The pharmacy was established for the main purpose of serving Internet pharmacy networks such as the Affpower organization. Affpower sought out licensed pharmacies such as Covino's in order to fill their drug orders. Savon RX was their largest supplier. They filled and shipped more than 200,000 orders between May 2005 and June 2006. These sales generated more than $26 million for Affpower. For their services, Saveon RX received about $7 for each order they shipped, on top of what they paid for the product. On top of that, Covino also earned a personal commission for each order shipped by Saveon RX.

Prasad admitted that Affpower recruited him because he was a licensed physician in Kentucky and Ohio. His job was to review and approve orders for prescription drugs. In a four-month period between March and June 2006, he admitted that he approved more than 30,790 orders for prescription drugs from Affpower customers. There were times that he reviewed and subsequently approved more than 1,000 orders in a day, sometimes spending less than five seconds reviewing the online medical questionnaire. He was paid $3 for every order he reviewed and during that four-month time period, he earned in excess of $95,000.