Des Moines, August 18, 2025 — SmartScripts, an Iowa-based telepharmacy company already facing millions in lawsuits, has been fined $25,000 for distributing counterfeit versions of the popular weight-loss drug Ozempic. The Iowa Board of Pharmacy announced the penalty this week but allowed the company to continue operating under a five-year probation with heightened oversight.
The disciplinary action comes amid a series of legal and regulatory challenges for SmartScripts, which has paid more than $6 million in judgments and settlements over the past two years. The case underscores rising concerns over counterfeit drugs in the U.S. pharmaceutical supply chain and the risks tied to telehealth’s rapid expansion.
SmartScripts’ troubles began in November 2023 when it ordered a single case of Ozempic pens from wholesale supplier Pharma Pac but instead received 15. Company owner Todd Thompson shipped the extra stock to a Michigan pharmacy distributor, Central Pharmacy Management, which later supplied additional pharmacies across the region. Soon after, Pharma Pac demanded payment for all 15 cases, prompting Thompson to quarantine remaining supplies and advise partners to halt sales.
Regulators allege Thompson learned the Ozempic was counterfeit on December 21, 2023, but failed to notify the Iowa Board of Pharmacy until July 2024. Thompson disputes that timeline, insisting he acted only after the FDA confirmed the counterfeit drugs, and that he immediately contacted pharmacies to prevent further distribution. He has argued that more than 100 pharmacies nationwide were victims of similar schemes and that his company was misled rather than complicit.
Legal challenges continue to mount. Central Pharmacy Management has sued SmartScripts for $132,249 in damages, accusing the company of negligence or knowingly distributing counterfeit medication. In another case, SmartScripts paid Maryland-based Tiero over $3 million after being accused of keeping insurance reimbursements owed to the COVID-19 testing company. The pharmacy has also faced class-action lawsuits tied to its telemarketing practices, which critics say violated Do Not Call regulations.
Founded in 2017 as Iowa’s first telepharmacy, SmartScripts delivers prescriptions to patients nationwide and has marketed its services aggressively through automated call systems. Regulators now say the company engaged in misleading practices, gross negligence, fraudulent billing, and poor record-keeping.
Despite these findings, the Iowa Board of Pharmacy stopped short of suspending or revoking SmartScripts’ license. Instead, the board imposed a $25,000 fine, probation, and strict compliance conditions, balancing the need to safeguard patients with the importance of maintaining access to pharmaceutical services in rural communities.