PIKEVILLE, Ky. — After a pair of federal indictments was made public this week, one of the central figures in both cases was found dead Thursday.
The body of James Ronald Huffman was discovered the day two indictments against him were unsealed. Lt. D. Browning, with West Viriginia State Police, said Huffman checked in to the Best Western motel in Chapmanville, W.Va., Wednesday, but never checked out. When motel staff went to check on him around 11 a.m., Thursday, they found him dead in his bed.
Browning said there is no indication at this time as to a cause of death, but there were no signs of foul play. His body was sent to the Chief Medical Examiner’s Office for an autopsy.
The medical examiner’s office has not yet issued a statement.
Huffman was one of nine people implicated in an Aug. 1 federal indictment, which alleged a conspiracy to sell prescription narcotics. The alleged scheme involved patients who would obtain prescriptions from a Houston, Texas, physician and fill them at pharmacies where Huffman worked.
Huffman was also one of three people charged in a separate indictment, also handed down Aug. 1 and involving a scheme to illegally sell prescription drug samples, conduct multimillion-dollar Medicare and insurance fraud, and conduct financial transactions involving proceeds from health care fraud.
The indictments had been sealed until after all of the defendants were served.
Texas-Ky. drug conspiracy
According to the first indictment, Dr. Linda J. Roos prescribed 125,000 units of Schedule II narcotics to 10 Kentucky residents over a 58-month period. Although the indictment does not identify the specific medications, Schedule II narcotics include drugs such as oxycodone and methadone.
The indictment says Huffman was a pharmacist at Marrowbone Clinic Pharmacy “until the owner found discrepancies,” at which time Huffman then opened another pharmacy nearby, the Marrowbone Hometown Pharmacy. The indictment notes that audits by the Kentucky Board of Pharmacy found “huge shortages” of controlled substances at both pharmacies during Huffman’s tenure, including 250,000 units at Marrowbone Clinic Pharmacy over a 46-month period and 20,000 units at Marrowbone Hometown Pharmacy over a six-month period.
A representative with the Board of Pharmacy said Friday that the agency could not comment on the audits, because its investigation is still open.
According to the indictment, patients would travel to Dr. Roos’ office to “obtain prescriptions for unusually large amounts of controlled substances, including oxycodone. Dr. Roos’ office would accomodate those patients by faxing a copy of the prescriptions to [Marrowbone Clinic Pharmacy] and [Marrowbone Hometown Pharmacy], so that Huffman would have the narcotics waiting for them upon their return home to Eastern Kentucky.”
Roos did not require the patients to travel to Houston every month, the indictment says. Instead, “every other month, the patient could just call Dr. Roos’ office, complete and fax in a one-page form and he or she would receive another prescription for the same pills. Dr. Roos did require prepayment of her fees.”
The indictment says Dr. Roos’ patients received “special attention” from Huffman’s pharmacy, where they “would be waited on by Huffman, himself, or office manager Beverly Lockhart.” Lockhart is also Huffman’s sister.
“Payments for the drugs obtained from Huffman through Dr. Roos’ prescriptions would often be paid for in cash, with those proceeds segregated from the other business of the pharmacy and subsequently deposited into Huffman’s personal account,” the indictment says.
The scheme began to unravel when two of Dr. Roos’ patients, Dennis and Helen Varney, who were also customers of Huffman, allegedly “sold controlled substances to [Kentucky State Police] cooperating witnesses on March 2, March 8 and June 23, 2011.” Following the the third sale, police searched the Varneys’ home, where they seized 626 oxycodone tablets and other items.
The indictment alleges Eddie West, Michelle West, Eric Duane Barton and Sheila Barton also “obtained controlled substances from various doctors on behalf of Dennis Varney and Helen Varney, for illegal distribution in Pike County … as elsewhere.”
Huffman, Roos, Lockhart and the Varneys, Wests and Bartons are all accused of conspiring between June 2006 and July 2011 to distribute Schedule II narcotics. Huffman, Roos and the Varneys each also face a single count of money-laundering during the same time period.
Dennis Varney also faces three counts of distributing oxycodone, based on the three alleged sales to KSP informants.
The conspiracy and distribution charges each carry a maximum sentence of 20 years in prison and $1 million in fines. In the event any of the defendants has a previous felony drug conviction, that sentence could jump to a maximum
The indictment also seeks forfeiture of $1 million from Roos, “which represents the fair-market value of controlled substances” she prescribed; $1 million from the remaining eight defendants, which represents the total they realized from their alleged crimes; and $1,563 seized during the raid on the Varneys’ residence.
Drug samples and insurance fraud
Huffman and Lockhart were also charged in the second indictment, along with Dr. Thad Ray Manning. According to the indictment, Manning gave Huffman “almost unlimited access” to prescription drug samples he received from drug sales representatives.
Manning had an office in the same building as Marrowbone Clinic Pharmacy until Huffman was fired in July 2011, at which time he moved into the same building as Huffman’s Marrowbone Hometown Pharmacy.
According to the indictment, the three conspired “with each other and others, with the intent to defraud and mislead, to knowingly sell, purchase or trade prescription drug samples,” between June 2007 and July 2011, and again from August 2011 to February 2012.
Manning is also charged with making false statments to investigators, saying, “he had no knowledge of sample prescription drugs … being transferred to the staff of Marrowbone Clinic Pharmacy or Marrowbone Hometown Pharmacy.”
Huffman and Lockhart are also accused of obtaining health coverage and submitting false claims to those insurers for prescriptions they never received, as well as submitting false claims to insurance companies and Medicare for prescriptions that were never provided to other patients. The indictment says the two conspired to process the fraudulent payments through Huffman’s pharmacy.
The second indictment also seeks forfeiture of $3 million from Huffman and Lockhart, which “represents the gross proceeds that the defendants obtained.”
The charges involving drug samples and insurance fraud carry maximum penalties of 10 years in prison and $250,000 in fines, while the charges regarding the financial transactions in aid of the fraud carry maximum penalties of 20 years in prison and $500,000 in fines. Manning faces five years in prison and $250,000 in fines if convicted of lying to investigators.