Inspections, Compliance, Enforcement, and Criminal Investigations

September 21, 2012: Manager of Johnson City Cancer Clinic Pleads Guilty to Receiving Unapproved Drugs

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Food and Drug Administration
Office of Criminal Investigations

U.S. Department of Justice Press Release


For Immediate Release
September 21, 2012

United States Attorney
Eastern District of Tennessee
Contact: Sharry Dedman-Beard
Public Information Officer
(865) 545-4167


GREENEVILLE, Tenn. - Michael Dean Combs, 32, of Piney Flat, Tenn., pleaded guilty on September 19, 2012, to receiving misbranded drugs in violation of the Food, Drug and Cosmetic Act. Sentencing has been set for 9:00 a.m., April 1, 2013, in U.S. District Court, Greeneville.

Combs faces a term of up to one year in prison and fines of up to $100,000. He was released pending sentencing.

As set out in his plea agreement, Combs was the business manager for East Tennessee Hematology-Oncology Associates, P.C., doing business as McLeod Cancer and Blood Center, Johnson City, Tenn., (McLeod Cancer), a professional corporation providing care and treatment for patients with cancer and blood diseases. McLeod Cancer purchased large amounts of prescription drugs, including chemotherapy drugs, which were administered through the clinic. McLeod Cancer then sought reimbursement through the Medicare and Medicaid/TennCare programs as well as other health benefits programs.

In 2007, McLeod Cancer began obtaining drugs from a Canadian business, Quality Specialty Products (QSP), which obtained the drugs from foreign sources, The drugs had not been approved by the U.S. Food and Drug Administration (FDA) for distribution or use in the United States. The FDA is responsible for enforcing the Food, Drug and Cosmetic Act to ensure the health and safety of the American public. The safety and efficacy of drugs is protected by requiring that any manufacturer or distributor of drugs in the United States be registered with and approved by the FDA. Drugs with labeling in a language other than English or from foreign sources not registered with the FDA are considered "misbranded." Further, the FDA regulates the distribution of drugs to ensure they are handled properly so as not to lose their efficacy (such as becoming too hot or cold).

After nurses at McLeod Cancer raised concerns in late 2007 and early 2008 about chemotherapy drugs with foreign labeling, the clinic stopped ordering drugs from QSP. However, in August 2009, Combs and McLeod Cancer's managing partner, Dr. William Kincaid, met with a QSP representative and began ordering misbranded unapproved drugs. Dr. Kincaid directed Combs to have the drugs shipped to a storage business in Johnson City which Dr. Kincaid owned. The drugs, after having been received at the storage business, were transported to Combs' office at McLeod Cancer and then placed by a pharmacy technician into the clinic's drug storage and control system where the misbranded drugs were mingled with FDA-approved drugs from legitimate sources. FDA-approved drugs obtained from legitimate U.S. drug manufacturers and distributors were still shipped directly to McLeod Cancer and not to the storage business.

McLeod Cancer obtained misbranded unapproved drugs, to include the drugs Abraxane®, Alimta®, Avastin®, Eloxatin®, Gemzar®, Herceptin®, Rituxan®/Mabthera®, Taxotere®, and Zometa®, from approximately September 2007 to early 2008 and from August 2009 to February 2012, purchasing over $2 million in misbranded unapproved drugs, providing those drugs to their patients, and billing Medicare, TennCare, and other government health benefits programs approximately $2.5 million for the unapproved drugs.

A copy of Combs' plea agreement, setting forth the facts in more detail, is on file with the U.S. District Court in Greeneville and is attached to this press release.

"Americans must have confidence that prescription drugs introduced into and distributed throughout the United States are genuine, FDA-approved products. Further, the public must be able to trust medical professionals who administer those medications," said Special Agent in Charge David Bourne of FDA's Office of Criminal Investigations, Miami Field Office. "The FDA will aggressively pursue all those who seek to profit from causing the importation and distribution of misbranded foreign drugs."

The investigation is continuing and additional charges are anticipated. Combs has agreed to cooperate with authorities in the investigation.

The charges were the result of an investigation by the FDA Office of Criminal Investigations, Federal Bureau of Investigation, and Tennessee Bureau of Investigation. Assistant U.S. Attorney Neil Smith represents the United States.


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