Iowa’s SmartScripts under fire: What to know about counterfeit Ozempic scandal
SmartScripts sanctioned over counterfeit Ozempic as lawsuits mount.
An Iowa-based telepharmacy already entangled in multimillion-dollar lawsuits is now facing state sanctions for its role in distributing counterfeit versions of the blockbuster weight-loss drug Ozempic.
The Iowa Board of Pharmacy confirmed that SmartScripts, headquartered in Washington, Iowa, violated state pharmacy laws after receiving and redistributing fake supplies of the drug. Despite the allegations, the board stopped short of revoking the company’s license. Instead, SmartScripts will remain in business under a five-year probation and must pay a $25,000 fine.
Counterfeit Ozempic Shipment Raises Alarms
According to board documents, the problem began in November 2023, when SmartScripts ordered one case of Ozempic—1,260 injectable pens—from Pharma Pac, a wholesale supplier. Instead of one case, the pharmacy allegedly received 15 cases.
Days later, SmartScripts shipped the supply to Central Pharmacy Management (CPM) in Michigan, which then passed the product along to at least two additional pharmacies.
By mid-December, when Pharma Pac asked for payment on all 15 cases, SmartScripts’ owner Todd Thompson reportedly quarantined what was left of the shipment and asked partners to stop selling the drug. On December 21, 2023, he allegedly discovered the Ozempic was counterfeit. However, the Board of Pharmacy claims he failed to report the matter to regulators until July 2024—more than six months later.
The board charged SmartScripts in January 2025 with gross negligence, falsifying records, and distributing drugs without lawful authority.
Thompson Pushes Back
Thompson disputes the state’s timeline, saying he acted immediately once the FDA informed him of the counterfeit drugs. He insists he contacted CPM right away, adding that no patients ever received the fake Ozempic.
“This was part of a much larger scam that affected more than 100 pharmacies nationwide,” Thompson said. “My mistake was selling in bulk to another pharmacy, not knowing the volume violated regulations.”
A Legal Battle with Central Pharmacy Management
CPM paints a different picture in court filings. The Michigan company claims SmartScripts either knew—or should have known—the drugs were counterfeit when it sold them for $132,249. CPM says it was the FDA, not SmartScripts, that first alerted them to the problem on December 27, 2023, after which the tainted supply was confiscated.
CPM alleges that Thompson then cut off communication, leaving the company with heavy losses. The case is scheduled for trial on September 16, 2025.
A Pattern of Lawsuits
The Ozempic scandal isn’t SmartScripts’ only problem. The company, launched in 2017 and once linked to prominent Iowa businessman Bruce Rastetter, has been repeatedly dragged into court:
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COVID-19 test kit lawsuit: In 2024, Maryland-based Tiero accused SmartScripts of misappropriating nearly $3 million in insurance reimbursements meant for at-home COVID-19 tests. The case ended with a consent judgment requiring SmartScripts to repay the money.
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Telemarketing complaints: The pharmacy settled two class-action lawsuits alleging it violated the national Do Not Call Registry by using robocalls to market medications.
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Supplier disputes: The company lost default judgments to KB Evans Drugs in Missouri ($68,154) and Capital Wholesale Drug Company in Ohio ($65,514) after failing to respond in court.
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McKesson Corp. lawsuit: In 2024, pharmaceutical giant McKesson sued SmartScripts and its principals—including Thompson and former investor Rastetter—for $2.1 million in unpaid bills. The case was settled in June 2025.
What’s Next for SmartScripts?
Despite the mounting controversies, SmartScripts continues to market itself as a pioneer in telepharmacy, claiming to serve patients in all 50 states. But with its license under probation and multiple lawsuits pending, the company’s future looks increasingly uncertain.
For Thompson, the challenge is twofold: clearing his name in court while convincing regulators and customers alike that SmartScripts can still be trusted. As the counterfeit Ozempic saga unfolds, Iowa’s first telepharmacy finds itself at the center of a cautionary tale about regulation, oversight, and the explosive demand for high-profile drugs.