FDA Enforcement Activities Protect Public 
by James S. Benson 
Deputy Commissioner of Food and Drugs 

Many people know the Food and Drug Administration as the federal agency 
whose scientists approve the safety and effectiveness of drugs and medical
devices, safeguard the wholesomeness of the nation's food supply, and ensure
the safety of cosmetics. But FDA is also a law enforcement agency whose 
nearly 1,000 investigators, compliance officers, laboratory personnel, and
attorneys work long and hard to make sure that the companies that produce 
products under the agency's jurisdiction comply with the federal Food, Drug,
and Cosmetic (FD&C) Act and other statutes enforced by FDA. 

It's a big job, covering merchandise accounting for nearly a quarter of all 
consumer spending. FDA-regulated goods are produced and distributed by
89,400 establishments, including 48,000 companies that handle food, 15,400
medical device firms, 13,600 companies that handle drugs for human use, and 
5,800 firms that make and sell animal drugs and medicated feeds.

During an average year, FDA investigators inspect about 20,000 of these 
companies in the United States and 400 abroad, review about 1.5 million 
imported goods, and conduct 100,000 examinations at the wharves. In 
addition, agency scientists each year analyze 75,000 product samples. 

FDA investigators look for violations of more than 20 specific "prohibited
acts" in the FD&C Act, ranging from introduction into interstate commerce of
unapproved new drugs and drug counterfeiting to adulteration or misbranding 
of any food, drug, medical device, or cosmetic. Many of these violations are
noted during routine inspections or are reported by consumers.

Typically, FDA enforcement annually results in 25,000 import detentions,
8,000 "inspectional observations" of violations, and about 9,000 other
measures, ranging from warning letters to voluntary corrections, product
recalls, seizures, injunctions, and criminal prosecutions.

Statistics alone, however, do not illustrate the commitment and skill of FDA
investigators. FDA routinely refers to the Department of Justice
recommendations for criminal investigation or prosecution. The charges filed
range from misbranding or adulterating products to conspiracy,
counterfeiting, and obstructing justice.

Here are some examples: 

Adulterated Fruit Juices

One major criminal case involved Beech-Nut Nutrition Corp. FDA investigators
found that the company had for years been substituting colored water for
apple juice. A 470-count indictment of the company and some of its officers 
was filed charging conspiracy, mail fraud, and marketing artificially 
flavored sugar water as apple juice concentrate with the intention to 
defraud and mislead, a felony violation of the FD&C Act. The company pleaded
guilty to 215 felony violations of the FD&C Act and was sentenced to pay
fines and costs totaling almost $2.2 million. The Beech-Nut vice president
for operations was tried, convicted and sentenced to a year and a day in
jail, and the president of the company to six months of community service.
In addition, each had to pay a $100,000 fine. Five companies that supplied
raw materials to Beech-Nut entered into plea-bargaining and received lesser 
sentences.

In a similar case, FDA investigators determined that Bodine's Orange Juice
had sold 28 million more pounds of orange juice concentrate than it had 
purchased and that the firm had bought 35 million pounds of beet sugar more 
than was needed for the drink products sold during the same period. Faced 
with the evidence, Edward Boden Sr., Bodine's chief executive officer,
pleaded guilty to felony violations and was sentenced to two years' 
imprisonment, a $250,000 fine, 1,000 hours of community service, and five 
years' probation. The president and vice president of the company received
lesser sentences. 

Potatoes in Horseradish 

An FDA inspection of Tulkoff's Horseradish Co. revealed that the firm was 
substituting potatoes for horseradish in its products. Although company 
officials went to great lengths to cover up the practice, FDA investigators 
found at the firm large quantities of hidden potatoes, some of which were 
kept in a secret compartment. 

A new analytical method developed by FDA scientists revealed the presence of
potato starch in several lots of the company products, all of which were
seized. Both the company and two responsible individuals pleaded guilty to
adulteration charges and were fined a total of $11,500. 

Failure to Report Adverse Drug Reactions

In 1985, FDA investigations revealed that SmithKline Beckman (which was then
SmithKline & French) and Eli Lilly and Company had failed to make mandatory 
reports of significant adverse reactions in people using their products. In 
the first of these cases, the company  pleaded guilty to 14 counts of 
failure to report adverse reactions and 20 counts of selling in interstate
commerce misbranded Selacryn, an antihypertensive prescription drug. the
company  and three of its employees were sentenced to a total of 1,100 hours
of community service. In addition, the corporation agreed to contribute 
$100,000 to help establish a child-abuse prevention program. Selacryn was 
withdrawn from the market at FDA's request. 

A few months later, Eli Lilly and Co. pleaded guilty to 10 counts of failing
to report adverse reactions occurring overseas that were associated with the
arthritis drug Oraflex, and to 15 counts of misbranding the drug. The 
corporation and its former vice president were sentenced to fines of $25,000
and $15,000, respectively. Oraflex was withdrawn from the market. 

Contaminated Penicillin 

In 1988, FDA and grand jury investigations led to the indictment of two drug
companies and their president-owner John Copanos. The charges included
conspiring to violate the FD&C Act and defraud FDA, making false statements 
and falsifying records, concealing test records on contaminated penicillin, 
and selling penicillin with an unapproved ingredient. 

FDA's surveillance had earlier resulted in multiple seizures, an injunction 
of drug shipments from plants with poor manufacturing conditions, and the 
revocation of all new drug approvals for injectable drugs issued to the 
companies. Copanos pleaded guilty to two felony violations and was sentenced
to a year and a day in prison and 1,600 hours of community service. He and
his companies were fined a total of $630,000. 

Unapproved New Drug for Infants 

E-Ferol was a high-potency, vitamin E intravenous injection manufactured by 
Carter Glogau Laboratories exclusively for O'Neal, Jones and Feldman (OJF). 
OJF sold it to neonatologists and neonatal intensive-care units. E-Ferol, 
used to treat deterioration of the retina and as a vitamin supplement, was
associated with adverse reactions in about 100 premature infants, 40 of whom
died. 

Neither firm had performed any studies to demonstrate the drug's safety, nor
did either apply for a new drug approval for E-Ferol. FDA inspected both
Carter Glogau Laboratories and OJF, both of which refused to provide
information on the development of the drug. The agency, however, was able to
secure evidence, in part from a civil litigation involving E-Ferol, and it
brought the case before a grand jury. 

In July 1987 both firms, their presidents, and one vice president were
indicted on 25 felony counts, including conspiracy, mail and wire frauds, 
and misbranding and unapproved drug charges. The presidents of the firms
were each sentenced to $130,000 fines and nine years in jail (all but six 
months of each sentence was dismissed), and one vice president was fined
$12,000 and sentenced to eight years in jail (all but six months was
dismissed). The two firms were sentenced to pay a total of $260,000 in fines
and $215,000 for the cost of the government investigation.

Mexican Steroid Smuggling Ring

In the fall of 1986, FDA's national steroid coordinator learned about the 
existence of manufactured counterfeit prescription steroid drugs on the 
black market. Following leads supplied by the Phoenix police department, FDA
investigators found evidence that the drugs were manufactured in Mexico and 
smuggled into the United States.

At FDA's request, U.S. Customs provided dozens of agents to assist in an
investigation that in 1987 resulted in the indictment of the owner of a 
multimillion-dollar pharmaceutical firm in Mexico and of a ring of smugglers
who brought into the United States millions of dollars worth of counterfeit 
prescription steroids. Although the Mexican citizens who were involved could
not be apprehended, all 30 individuals charged in the case pleaded guilty 
and were sentenced to up to seven years in jail.

Heptachlor-Treated Seed 

FDA inspection of a gasohol plant operated by J.E.W. (Jack E. White), Inc., 
established that the firm produced feed from high-moisture grain and seeds
treated with heptachlor, a pesticide toxic to humans, which left violative
residues in the milk of cows that consumed it. FDA analysis showed
heptachlor levels 1,000 times the allowable limit in feeds and more than 120
times the amount permitted in milk. 

As a result, 11 firms recalled their milk and dairy pro-ducts, and, under 
FDA's coordination, the Federal Bureau of Investigation, U.S. Department of 
Agriculture, Environmental Protection Agency, and the Arkansas State Health 
Department launched an investigation into the violations. 

Based on the collected evidence, a federal grand jury indicted four 
individuals, including Jack E. White, on 52 counts, including racketeering, 
mail fraud, and FDA felony counts of contamination of feed. White and two 
other defendants were convicted and sentenced to prison terms of from one to
three years and fined up to $7,500 each. The fourth defendant was fined 
$5,000 and placed on three years' probation.

Bulk Veterinary Drugs 

In January 1987 FDA forwarded to the Department of Justice a recommendation 
for a criminal investigation involving bulk veterinary drugs. The 
possibility of violations had been under investigation for nearly three 
years by six FDA district offices.

The evidence collected by FDA and the grand juries revealed smuggling,
conspiracy, adulteration, and misbranding of animal drugs in 15 states and
foreign countries, including West Germany, the Netherlands, Canada, and the 
Grand Cayman Islands. More than 32 tons of adulterated, misbranded or 
smuggled drugs worth $800,000 were seized in Illinois and Nebraska and by 
U.S. Customs. 

So far, 41 individuals in six firms have been convicted in connection with
the case and sentenced to fines, imprisonment or both. Jeffrey A. Engel,
president of Custom Feed Blenders, was sentenced to three years in jail (all
but six months suspended), a $10,000 fine, and 1,500 hours of community 
service. Two importers, Heinz G. Dall and Robert M. Clack, were sentenced to
two years in prison and a $40,000 fine each. (For more information on this
case, see the Investigators' Reports section in this issue.)

Clinical Studies

  Following an FDA inspection of clinical investigations by Robert Fogari,
M.D., of Jersey City, N.J., of a drug for arthritis, a grand jury subpoenaed
more than 50,000 documents bearing on his previous studies. It was suspected
that the studies were not in compliance with applicable laws and FDA
regulations.

An FDA compliance officer interviewed more than 200 patients, study 
assistants, and representatives of the nine drug companies that had paid
Fogari close to $2 million for his clinical work. As a result, Fogari was 
charged with conspiracy and 15 counts of submitting false documents in
support of applications for approval to study a new drug in humans and to 
market new drugs. The data supplied by Fogari were excluded from approval 
applications submitted to FDA.

Fogari was tried and halfway through the trial changed his plea to guilty.
He was sentenced in February 1989 to three years in prison, a $2 million
fine, and $1.8 million in restitution to compensate the drug firms he had 
defrauded. He also received two lesser jail sentences to run consecutively
and probation for five years. A month later, the New Jersey Board of Medical
Examiners revoked Dr. Fogari's medical license. 

Falsified Tests 

The case resulted from a major FDA investigation of Industrial Bio-Test 
(IBT), which revealed systematic false reporting of drug toxicity in animals
and animal health status. The company had its employees replace dead or 
dying animals to falsify results of studies conducted for drug and cosmetic 
companies. The toxicity reports were later filed by product sponsors in 
support of their applications for FDA product approval. 

After a six-month trial in Chicago, three IBT officials were convicted of 
mail fraud, wire fraud, and of making false statements about animal studies 
involving a deodorant ingredient and an anti-inflammatory drug. One 
defendant was sentenced to a year in prison and four years' probation. Two
were sentenced to six months in jail each and two years' probation. 

These examples--as well others that have appeared in the Notices of Judgment
(now Summaries of Court Actions) and Investigators' Reports sections of this
magazine--show that FDA takes seriously its mandate of a scientifically 
based law enforcement agency. Despite scarce resources, the agency has not
spared effort to meet its twin responsibility of safeguarding public health 
and ensuring honesty and fair-dealing between the regulated industry and
consumers.