Doctor admits illegal drug sales

TRENTON — Philip B. Eatough, the Rumson physician accused by federal prosecutors of using his medical practice as a front for illegal drug distribution, pleaded guilty in U.S. District Court on Tuesday to money laundering and the illegal distribution of oxycodone.

Eatough, 61, also must surrender his medical license no later than Sept. 15 as part of a plea deal with prosecutors.

In a related matter, his office assistant, Betty Over, pleaded guilty to a misdemeanor charge of aiding and abetting the illegal possession of oxycodone by another person. She is not expected to face any jail time, attorneys said.

Over had been indicted on a charge of money laundering. That charge will be dismissed when she is sentenced on Oct. 10.

Both pleas were entered before U.S. District Court Judge Anne E. Thompson, sitting in Trenton.

The action caps more than five years of investigation and legal proceedings at the state and federal levels and renders moot a state hearing into whether or not Eatough should be stripped of his license to practice medicine.

Standing beside his attorney, John McDonald, Eatough answered "yes" 10 times to questions posed by Assistant U.S. Attorney Robert Frazer outlining the factual basis for his guilty plea.

Eatough paused several seconds before admitting he prescribed drugs without a legitimate medical purpose.

Eatough is expected to face anywhere from 36 to 42 months in prison when he is sentenced on Oct. 10. He will remain free on a $1 million bond until sentencing.

Had he been convicted at trial he could have faced a maximum of 20 years in prison and a $1 million fine.

Gerard McAleer, special agent in charge of the federal Drug Enforcement Administration in New Jersey, said the case was an important one for law enforcement.

"Not only did he violate federal law, he violated the first tenet of the medical profession: "First, do no harm,' " McAleer said. "He, through his own mouth, admitted the harm he did and his own culpability."

Police and federal agents had accused Eatough of using his offices in Keansburg and Middletown to distribute opioid-based painkillers to drug abusers under the guise of pain management.

While several of his patients described selling the medicines they were given — prosecutors said one told a grand jury she made as much as $20,000 a week distributing the drugs — others said Eatough was a savior who offered relief from chronic pain.

The case plumbed the murky area of pain management, with experts on both sides of the issue weighing in on whether or not Eatough's actions had crossed legal and ethical lines.

In the end, his defense began to unravel as prosecutors continued, in court papers and in a series of administrative actions, to hammer at inconsistencies in record keeping and the high dosages he was prescribing.

While experts were not in general agreement about how much medication constituted too much, Eatough's failure to drug test patients for evidence they were abusing other substances was criticized in an administrative hearing before the state Board of Medical Examiners.

At those hearings, the state Attorney General's Office produced an expert who testified such testing was an accepted and recommended practice for pain-management physicians.

Those sentiments were echoed by the U.S. Drug Enforcement Administration.

Eatough closed his Keansburg office as federal and local investigators began to comb through records of his drug disbursements between 2001 and 2005.

He was arrested in October after a federal grand jury returned an 11-count indictment against him.

Eight of the drug distribution charges are to be dismissed at the time of sentencing under the plea agreement, Frazer said.

His Middletown office was also closed in recent weeks as the terms of the plea deal were hammered out with prosecutors.