Former Parsippany Lab Employees Admit Bribing Doctors

Former sales representatives of Parsippany-based Biodiagnostic Laboratory Services LLC admitted today to conspiring with others to bribe doctors to refer patient blood samples to the firm, U.S. Attorney Paul J. Fishman said.

William Dailey, 41, of Wall, and Peter Breihof, 42, of Nutley, pleaded guilty before U.S. District Judge Stanley R. Chesler, sitting in Newark, to charges of conspiracy to violate the Anti-Kickback Statute and the Federal Travel Act, according to a statement from the U.S. Attorney's office.

Morris and Passaic county residents also have been charged in the alleged scheme.

Company president Davis Nicoll, 39, of Mountain Lakes; Scott Nicoll, 32, of Wayne, a senior lab employee; and Craig Nordman, 34, of Whippany, a lab employee and CEO of Advantech Sales LLC were charged April 9.

From 2006 to 2013, Biodiagnostic Laboratory Services and entities it funded paid millions of dollars to physicians to induce them to refer patient blood samples to the firm. From these referrals, the company received tens of millions of dollars from private health insurance companies and Medicare, Fishman said. 

Breihof and Dailey admitted today to using phony lease and service agreements to bribe physicians to send their patients’ blood samples to the lab. Breihof and Dailey also admitted that they paid various physicians a fee per test on behalf of BLS in order to induce those physicians to order more of the blood tests than they otherwise would have.

Breihof and Dailey each face a maximum potential penalty of five years in prison. Each count also carries a maximum $250,000 fine, or twice the gross gain or loss from the offense. In addition, Breihof has agreed to forfeit $1,179,556, and Dailey has agreed to forfeit $558,405. Sentencing for both defendants is scheduled for Sept. 19, 2013.