SmartScripts Faces Legal Heat Over Suspected Fake Ozempic
An Iowa-based pharmacy, SmartScripts, is facing mounting legal and regulatory challenges after being found responsible for distributing counterfeit versions of Ozempic, a medication prescribed for diabetes treatment and widely used for weight loss.
The Iowa Board of Pharmacy has placed the company on a five-year probation and imposed a civil penalty of $25,000 rather than revoking its license. The decision comes while SmartScripts is already contending with several lawsuits and multimillion-dollar settlements.
Via AInvest
Court records indicate that combined judgments and settlements in recent years have surpassed six million dollars. This case highlights vulnerabilities in pharmaceutical supply chains and raises serious questions about oversight within the expanding telepharmacy sector.
Counterfeit Ozempic Shipment Raises Concerns
The controversy began in November 2023 when SmartScripts ordered one case of 1,260 Ozempic pens from Pharma Pac, a wholesale distributor. Each pen was designed to deliver four milligrams of the medication, which is in high demand nationwide due to its effectiveness in weight management.
Via Global News
Regulatory documents indicate that SmartScripts unexpectedly received fifteen cases rather than the single case it requested. The surplus was sent to Central Pharmacy Management in Lansing, Michigan, which further distributed the products to other pharmacies. This unexpected delivery raised immediate concerns about supply chain integrity and product authenticity.
On December 18, 2023, Pharma Pac contacted Todd Thompson, the owner of SmartScripts, demanding payment for all fifteen cases. In response, Thompson quarantined the remaining stock in his possession and advised the recipient pharmacies to stop selling the drug. However, state regulators later accused him of waiting until July 2024 to report the counterfeit status of these drugs to the Iowa Board of Pharmacy.
Via MedWatch
Dispute Over When Counterfeit Status Was Discovered
The Iowa Board of Pharmacy claims that Thompson first became aware on December 21, 2023, that the Ozempic supplies were counterfeit. According to the board, this knowledge was not shared with regulators for more than six months. This delay became a crucial factor in the disciplinary action brought against SmartScripts in January 2025.
Thompson disputes the board’s timeline, arguing that he learned of the counterfeit issue only after the Food and Drug Administration notified him days after the products had already been shipped to Central Pharmacy Management. He asserts that he immediately informed the purchasing pharmacy and worked to ensure no counterfeit medication reached patients.
Via The Conversation
Thompson also stated that counterfeit Ozempic distribution schemes affected more than one hundred pharmacies nationwide. He maintains that SmartScripts was a victim of a fraudulent supply chain rather than an active participant in wrongdoing. This claim underscores his position that systemic vulnerabilities in pharmaceutical sourcing, rather than deliberate misconduct, were to blame for the incident.
Legal Battles With Central Pharmacy Management
Central Pharmacy Management has sued SmartScripts, seeking damages of $132,249. The Michigan-based pharmacy claims that Thompson and his company either knowingly sold counterfeit products or failed to exercise due diligence to verify authenticity. Court filings indicate that Central Pharmacy Management received its shipment from SmartScripts on December 7, 2023.
Via The Des Moines Register
The company claims it was informed by FDA agents on December 27, 2023, that the Ozempic was counterfeit. Central Pharmacy Management also alleges it notified SmartScripts immediately, but Thompson stopped returning phone calls once the drugs were confirmed to be fraudulent.
SmartScripts denies any intentional misconduct, maintaining that the company never distributed counterfeit medication knowingly. The case is scheduled to go to trial on September 16, 2025, and its outcome could have significant implications for both companies.
Via Rolling Out
Past Legal Issues Involving SmartScripts
The counterfeit Ozempic case is only one of several legal disputes involving SmartScripts in recent years. Since its launch in 2017 as Iowa’s first telepharmacy, the company has faced lawsuits stemming from its business practices and marketing methods.
SmartScripts previously settled a class-action lawsuit in 2023 for allegedly making robocalls to individuals listed on the national Do Not Call Registry. While the company admitted to using phone numbers purchased from data brokers, it denied deliberately calling individuals who had opted out of telemarketing. A similar case was resolved out of court in 2022 under comparable circumstances.
Via SmartScript
In 2024, SmartScripts also agreed to pay over three million dollars to Tiero, a Maryland-based company that sold at-home COVID-19 test kits. Tiero accused SmartScripts of improperly retaining insurance reimbursements instead of forwarding them as required. According to court records, the pharmacy agreed to settle the issue for $3,052,575 without acknowledging any wrongdoing.
Additional Judgments and Settlements Across States
SmartScripts’ legal troubles extend beyond Iowa and Maryland. In Missouri, the company was sued by KB Evans Drugs, resulting in a $68,154 judgment after SmartScripts allegedly failed to respond to the lawsuit. In Ohio, the pharmacy faced another case brought by Capital Wholesale Drug Company, which ended in a judgment of $65,514 under similar circumstances.
Via Kosnett Law Firm
In federal court, SmartScripts was sued by McKesson Corporation, a Texas-based supplier, for approximately $2.1 million in unpaid bills. That lawsuit named Todd Thompson and two other principal members of SmartScripts, Samuel Zoske and Bruce Rastetter.
Thompson has stated that Rastetter, a former Iowa Board of Regents president, was an early investor who has not been involved in company operations for years. The McKesson case was settled in June 2025 without admission of liability.
Via CVS Health
As SmartScripts grew its telepharmacy business across the country, it has been beset by financial difficulties and compliance problems, which are evident in these ongoing disagreements. The accumulation of lawsuits and judgments has intensified scrutiny from regulators and industry observers, raising doubts about the company’s long-term stability and operational practices.
Telepharmacy Model Under Regulatory Scrutiny
SmartScripts’ operations rely heavily on direct-to-consumer delivery of medications across all fifty states, which has positioned the company as a pioneer in telepharmacy. Its business model uses automated telemarketing to reach potential customers and deliver prescriptions efficiently. However, this approach has brought regulatory attention.
Via RedSail Technologies
Allegations regarding improper marketing practices, insurance billing irregularities, and now counterfeit drug distribution have raised questions about the oversight of telepharmacy companies in general. State boards and federal regulators are increasingly examining how these businesses manage supply chains, verify drug authenticity, and maintain accurate records.
The counterfeit Ozempic case adds to broader concerns about how rapidly growing telehealth and mail-order pharmaceutical services can ensure patient safety while maintaining operational efficiency. It highlights the need for stronger safeguards and better verification mechanisms throughout the pharmaceutical supply chain to prevent similar incidents.
Via TRC Healthcare
Regulatory Settlement Balances Access and Accountability
In its final order, the Iowa Board of Pharmacy charged SmartScripts with multiple violations, including providing misleading information, committing gross negligence, collecting fees through fraudulent means, maintaining inaccurate records, and possessing drugs without proper authorization.
Rather than suspend or revoke SmartScripts’ license, regulators opted for a probationary approach. The pharmacy will remain under state supervision for five years and must adhere to strict compliance measures. The severity of the infractions is further highlighted by the $25,000 civil penalty.
Via Stalwart Law Group
This decision reflects an effort to balance the need for public safety with the importance of maintaining access to pharmacy services in rural communities. Telepharmacy companies like SmartScripts fill crucial gaps in healthcare delivery by serving patients in areas with limited pharmacy options. However, regulators expect these companies to meet high standards of accountability and transparency.
Implications for the Pharmaceutical Supply Chain
The events surrounding SmartScripts demonstrate how weaknesses in drug distribution channels can allow counterfeit products to infiltrate the market. The rapid rise in demand for medications such as Ozempic has created opportunities for fraudulent actors to exploit gaps in verification processes.
Via EZO
This case illustrates the need for improved coordination among pharmacies, wholesalers, and federal agencies to identify and stop counterfeit drugs before they reach consumers. It also highlights the importance of timely reporting when potential problems are detected.
Industry observers believe that future regulations may impose tighter controls on wholesale transactions, especially those involving unusually large quantities of high-demand medications. Enhanced record-keeping, product tracking, and verification systems are likely to become central to pharmacy operations moving forward.
Via Sneci
Looking Ahead to Upcoming Trial
With a trial scheduled for September 16, 2025, SmartScripts faces continued legal exposure. The case with Central Pharmacy Management will examine whether SmartScripts knowingly or negligently distributed counterfeit Ozempic and whether its actions violated contractual and regulatory obligations.
Regardless of the trial’s outcome, the scrutiny faced by SmartScripts has already placed telepharmacy practices under the microscope. State boards of pharmacy and federal regulators may use the findings from this case to develop new compliance standards designed to prevent similar issues from occurring elsewhere.
Via iSlaw
Thompson insists that no counterfeit products from his company ever reached patients and maintains that SmartScripts cooperated with the FDA throughout the investigation. Whether these claims will influence the court’s judgment remains to be seen.
Discover the Ozempic Lawsuit Against SmartScripts Explained
The SmartScripts controversy underscores the growing challenges facing pharmacies in an era of increased demand for high-profile medications like Ozempic. Allegations of counterfeit distribution, delayed reporting, and multiple lawsuits have tarnished the reputation of a company once regarded as a leader in telepharmacy innovation.
Via Iowa Capital Dispatch
While the Iowa Board of Pharmacy chose to impose probation and financial penalties instead of revoking SmartScripts’ license, the case serves as a warning about the critical importance of vigilance, accurate record-keeping, and transparent communication within the pharmaceutical supply chain.
As SmartScripts navigates its probationary period and prepares for trial, the company’s experience highlights how even established pharmacy operations must maintain rigorous safeguards to protect patients and ensure compliance with state and federal law. The outcome of this case will likely have lasting implications for telepharmacy businesses and the broader healthcare industry.
