New Jersey – Two former executives of a Louisiana compounding pharmacy have been convicted of orchestrating a $100 million healthcare fraud scheme that targeted New Jersey’s state health benefits programs and TRICARE, the federal insurance plan for military personnel and their families.
Christopher Kyle Johnston, 46, of Baton Rouge, Louisiana, and Trent Brockmeier, 62, of The Villages, Florida, were found guilty on March 10, 2025, of multiple felony charges, including conspiracy to commit wire fraud, health care fraud, identity theft, and money laundering. Their conviction followed a six-week trial before U.S. District Judge Edward S. Kiel in Newark.
Sentencing is scheduled for July 21, 2025, with both facing decades in prison and millions in fines.
Evidence presented during the trial revealed that Johnston and Brockmeier, former executives at Central Rexall Drugs—a Louisiana pharmacy specializing in compounded medications—manipulated the compounding process to maximize insurance reimbursements rather than fulfilling actual medical needs.
In 2013, the two men took control of Central Rexall, agreeing to split 90% of its profits. They exploited reimbursement loopholes, realizing that insurers, especially New Jersey’s public health programs and TRICARE, would pay thousands of dollars per prescription for certain custom-mixed medications, including:
Pain creams
Scar treatments
Antifungal medications
Vitamin blends
Johnston and Brockmeier designed drug formulas intended to generate the highest insurance payouts, testing fake prescriptions to determine which combinations yielded the highest reimbursements. These fake medications were not prescribed by doctors, and the pharmacy submitted fraudulent claims using real patients’ identities without their knowledge or consent.
The defendants built a high-pressure sales operation to push these costly prescriptions, using illegal tactics such as:
Forging prescriptions and submitting them without patients’ knowledge
Bribing doctors to sign off on prescriptions without examining patients
Paying patients to accept unnecessary medications
Refilling prescriptions without patient consent
The fraudulent scheme resulted in approximately $100 million in false insurance claims. Johnston pocketed $34 million, while Brockmeier took $5 million from the illicit proceeds.
Both men were convicted on three felony counts:
Conspiracy to Commit Wire Fraud and Health Care Fraud: Up to 20 years in prison and a $250,000 fine, or twice the amount of the fraudulent gain or loss
Conspiracy to Commit Identity Theft: Up to five years in prison and a $250,000 fine
Conspiracy to Commit Money Laundering: Up to 10 years in prison and significant financial penalties, including twice the amount of laundered funds
To date, 50 individuals have been convicted or pleaded guilty in connection with the larger conspiracy.
The convictions were the result of a multi-agency investigation involving the FBI’s Atlantic City Resident Agency (under Acting Special Agent in Charge Terence G. Reilly), IRS Criminal Investigation (led by Special Agent in Charge Jenifer Piovesan), and the U.S. Department of Labor’s Office of Inspector General (under Special Agent in Charge Jonathan Mellone).
The case was prosecuted by Assistant U.S. Attorneys R. David Walk, Jr. and Daniel A. Friedman of the Criminal Division.
This conviction underscores the federal government’s aggressive stance against healthcare fraud and identity theft, particularly schemes that target public health insurance programs and military benefits.
Authorities continue to crack down on fraudulent compounding pharmacies, which are a growing source of healthcare fraud nationwide, costing billions in taxpayer-funded programs.
Johnston and Brockmeier will remain in custody until their sentencing in July 2025, where they face substantial prison time and restitution orders aimed at recovering fraudulent funds.
Federal authorities urge victims of medical fraud to report concerns to the FBI, IRS, or the U.S. Department of Labor’s fraud hotline.
