Inspections, Compliance, Enforcement, and Criminal Investigations

Office of Criminal Investigation 2003

Center for Drug Evaluation and Research

Internet Website Found Selling Street Drug Alternatives

In December 2001, OCI’s Metro Washington Field Office received information from the FDA’s Center for Drug Evaluation and Research (CDER) regarding a Baltimore, Maryland based Internet website (www.ecstacy-stuff.com) that offered for sale what appeared to be street drug alternatives. In January, February and March 2002, OCI made a total of 13 undercover purchases from this Internet website. Products purchased included Trip2night, Hydobuds, X tablets, Thunder, and Rave X Pills.

On August 8, 2002, OCI executed a search warrant at the residence and business of Louis Ostraw. Items seized included Trip2night and other street drug alternatives.

On September 2, 2002, Ostraw agreed to fully cooperate with the government and provided information that identified the source of the Trip2night.

On February 21, 2003, Ostraw was convicted of 1 felony count of 21 U.S.C. §§ 331(a) and 333(a)(2) - Introduction of a Misbranded Drug for Sale.

On April 23, 2003, Ostraw was sentenced to 2 years probation and ordered to pay $1,000.00.

OCI Investigation Uncovers Smuggling of Anabolic Steroids

Confidential Informant Assists OCI in Investigation

OCI’s Chicago Field Office initiated this investigation on December 6, 2001, based on information provided by the Racine County, Wisconsin, Sheriff’s Department. According to the Sheriff’s Department, Gordon John Sigl, a reserve Air Force Captain, was smuggling steroids/drugs/growth hormone from other countries and using his official credentials to bring the products back into the United States for resale. Investigations revealed that Sigl stated in an email that he was interested in starting a “steroid cycle.” Sigl stated that he was using the steroids, testosterone and decadurabolin, and that he obtained the drugs during trips for the U. S Air Force Reserve.

After Sigl returned from a trip to Egypt which he had taken with the U.S. Air Force, he stated that he was going to start a 10-week steroid cycle with the steroids he brought back from Egypt.
Sigl sold ampoules of Egyptian sustenon for $300, which included syringes, as well as 10ml bottles of Testerona 200 and syringes. Sigl also brought back from Mexico “400 Testosterone” (T-400), a stronger product, and sold it.

On May 3, 2002, OCI executed a federal search warrant. During the search, agents seized three additional bottles of Mexican made veterinary steroids. In addition, Sigl provided a statement and admitted to smuggling the steroids from other countries, and using military transport on one occasion to complete the smuggling.

On May 21, 2002, Sigl was indicted in a federal district court, Eastern District of Wisconsin, for violation of 21 U.S.C. §§ 841(a)(1), 841(b)(1)(D) – Knowingly and Intentionally Distributing Anabolic Steroids.

On April 25, 2003, Sigl was convicted of 21 U.S.C. §§ 841(a)(1), 841(b)(1)(D) – Knowingly and Intentionally Distributing Anabolic Steroids. Sigl was sentenced to 18 months probation and ordered to pay $1,200.00 in restitution.

Forged Medical Pescriptions Used to Obtain Morphine

OCI Works with Local Law Enforcement To Obtain Crucial Evidence

OCI’s Chicago Field Office initiated this investigation on July 16, 1996, pursuant to information provided by FDA’s Minneapolis District Office regarding a suspected illegal drug mail order business in the Minneapolis area. The business, D & K Supplements, was distributing promotional material advertising the sale of anabolic steroids, Clenbuterol, HGH, and other prescription drugs.

During the course of this investigation, OCI determined that forged medical prescriptions were being used to obtain Roxanol, a liquid morphine. Based on forensic analysis, it appeared that a blank prescription was being copied and authored by the same person for the Roxanol. A total of 123 forged prescriptions for Roxanol were obtained from various pharmacies throughout the Minneapolis/Saint Paul area. In conjunction with local law enforcement, Ramsey County Sheriff’s Department and the Hennepin County Drug Task Force, three search warrants were executed leading to evidence crucial to the investigation.

Grand Jury subpoenas were served for handwriting exemplars on three of the defendants. The U.S. Secret Service, Forensic Services Division, conducted the handwriting analysis on the forged prescriptions (112 prescriptions) and a journal seized during one of the arrests. The handwriting examiner concluded that David Tereault authored 106 of the prescriptions as well as the journal.

On May 8, 2002, a Federal Grand Jury in the District of Minnesota, indicted Douglas Gerhart, William Fee, Jamison Conlin, Sherry Stiffler and Todd Stiffler for violations of 18 U.S.C.§ 371 – Conspiracy; 21 U.S.C. §§ 331(a), 331(k), 333(a)(2), 353(b)(1), 353(b)(1)(A), 353 (b)(1)(B) – Introduction into Interstate Commerce of Misbranded Drugs; and 21 U.S.C. §§ 846 and 841(b)(1)(C) - Conspiracy to Possess with Intent to Distribute Controlled Substances.

The indictment was a result of the defendants’ scheme to obtain large volumes of the Roxanol using forged medical prescriptions and then using and/or selling the Roxanol at a profit. All defendants were arrested and entered pleas of not guilty at their arraignments.

On August 28, 2002, Gerhart and Conlin were convicted of violations of 18 U.S.C. § 371- Conspiracy; and 21 U.S.C. §§ 331(a) and 331(k), 333(a)(2), and 353(b)(1)(A) and (B)] - Introduction into Interstate Commerce of Misbranded Drugs.

On August 30, 2002, Fee and Todd and Sherry Stiffler were convicted of violations of 18 U.S.C. § 371- Conspiracy; and 21 U.S.C. §§ 331(a) and 331(k), 333(a)(2), and 353(b)(1)(A) and (B) – Introduction into Interstate Commerce of Misbranded Drugs. On the same date, Tereault was convicted of 21 U.S.C. § 846 and 841(b)(1)(C)] - Conspiracy to Possess with Intent to Distribute Controlled Substances.

On December 13, 2002, Gerhart was sentenced to 6 months incarceration at the Volunteers of America, Minneapolis, Minnesota, and placed on supervised release for a term of 2 years after incarceration.

On December 13, 2002, Fee was sentenced to 1 year and 1 day incarceration, and placed on supervised release for a term of 2 years after incarceration.

On December 18, 2002, Conlin was sentenced to 6 months incarceration with the United States Bureau of Prisons and placed on supervised release for a term of 2 years after incarceration.

On April 3, 2003, Sherry Stiffler was sentenced and required to reside at the Volunteers of America, Minneapolis, Minnesota, for a period of 6 months with work release privileges, and placed on probation for a period of 3 years.

On April 3, 2003, Todd Stiffler was sentenced to 1 year and 1 day incarceration, and placed on supervised release for a term of 2 years after incarceration.

On April 11, 2003, Tereault was sentenced to 14 years incarceration.

Bioresearch Monitoring

Clinical Investigator Convicted of Conspiracy

Researcher Fabricated Participants in Clinical Study

The FDA’s San Juan District Office referred this investigation to OCI’s Miami Field Office. During a routine inspection of the State Public Health Hospital (CDT Bayamon), an FDA Consumer Safety Officer noted numerous questionable event entries and other notations attributed to Caro Acevedo, M.D., a clinical investigator for an Investigational New Drug study.

Investigation by the FDA’s San Juan District Office and OCI revealed that Dr. Acevedo had fabricated participants in the study, failed to report adverse effects noted in the study, failed to maintain accountability of study medications, provided false and fraudulent information to the FDA, and diverted funds intended to compensate participants to his own use.

On February 16, 2001, Dr. Acevedo was convicted of 18 U.S.C. § 371 – Conspiracy. Acevedo was sentenced to a $10,000 fine and 24 months probation. The Commonwealth Board of Medical Examiners suspended his license to practice medicine for 2 years in June 2001.

On February 27, 2003, coordination with the San Juan District revealed that Dr. Acevedo had failed to respond to his Notice of Disqualification, pursuant to 21 C.F.R. Part 16 and 312. Dr. Acevedo was formally disqualified by the FDA as a clinical investigator on August 24, 2003.

Clinical Investigator Falsifies Data

Clinical Investigator Fabricates 6 of 12 Patients in IND

OCI’s New York Field Office initiated this investigation based on reports that between August and November 1999, Dr. Allyn Norman falsified data in an Investigational New Drug (IND) study. OCI’s investigation disclosed that Norman completely fabricated six of twelve patients required for this IND.

On October 28, 2002, Norman appeared before U.S. Magistrate Judge Hugh Scott and was convicted of 21 U.S.C. § 331(e) and 333(a)(1) - Failure to Establish or Maintain Adequate Records of the Disposition of an Investigational New Drug.

On January 27, 2003 Judge Scott sentenced Norman to pay a $5,000 fine.

Practicing Medicine Without a License

"Doctor" Found Treating Patients in Motel Room

Office of Criminal Investigations, New York Field Office, initiated this investigation based on information received from the New York State, Office of Professional Discipline (NYS/OPM) located in Rochester, New York. The NYS/OPM advised that Naturopathic Physician, Gary Barragato, claimed he was a doctor and that Barragato was illegally treating patients in his Rochester, New York motel room with unapproved new foreign injectible prescription drugs.

Record checks disclosed that Barragato had prior state convictions for practicing medicine without a license in Texas and New Mexico, and investigation conducted with the Monroe County Sheriff’s Office and NYS/OPM confirmed that he was doing so in Rochester, New York.

On April 23, 2002, Barragato was indicted on an 8-count indictment charging him with violations of 21 U.S.C. §§ 331 and 333- Misbranded Drugs; and 18 U.S.C. § 1001(a) - False Statements.

On April 26, 2002, an arrest warrant was issued by the Western District of New York. Barragato was subsequently arrested in Daytona, Florida, and arraigned in Rochester, New York.

On October 24, 2002, Barragato appeared before Federal District Court Judge Michael Telesca and was convicted of 21 U.S.C. §§ 331( c ) and 333(a)(2) - Receiving Misbranded Drugs in Interstate Commerce.

On January 21 2003, Judge Telesca sentenced Barragato to serve a 5 year period of probation, and ordered him to pay a $5,000 fine.

Prescription Drugs From Mexico

OCI’s Miami Field Office initiated this investigation based on information received from a private investigator located in Southern California, who was on contract with several U.S. pharmaceutical companies. The private investigator purchased various prescription drugs from pharmacies located in Tijuana, Mexico. The prescription drugs were generic versions of Prozac, Premarin and others. Additionally, U.S. citizens purchased drugs from these pharmacies and hand-carried the drugs back to the U.S.

Several of these drugs declared on the labeling that they had been manufactured by Jean-Marie Pharmacal in Hong Kong, and exported by DNA Pharmaceuticals, Inc. (DNA Pharmaceuticals), which is located in Miami Florida. DNA Pharmaceuticals is licensed as a wholesaler in Florida, but not as a repacker.

On January 24, 2003, Oscar Del Cid, President of Vital Industries (parent company of DNA Pharmaceuticals), was convicted of violating 21 U.S.C. § 331(k) – Introduction of an adulterated drug after shipment into interstate commerce. Vital Industries was convicted of violations of 18 U.S.C. § 1956 – Money Laundering; 18 U.S.C. § 2 – Aiding and Abetting; and 21 U.S.C. § 331(k) – Introduction of an adulterated drug after shipment in Interstate Commerce.

Carlos Alfaras, Vice President of Vital Industries, was convicted of violating 21 U.S.C. § 331(k) – Introduction of an adulterated drug after shipment in Interstate Commerce.

On June 27, 2003, Del Cid and Alfaras were each sentenced to 1 year probation, with 6 months house arrest to be served concurrently and fined $20,000.00 each. Vital Industries was sentenced to 5 years probation, fined $260,000.00, and ordered to pay a monetary forfeiture in the amount of $205,985.02.

Physician Burglarizes Former Medical Practice

Doctor Admits to Five-Year Drug Addiction to Narcotics

This investigation stems from information provided to OCI’s Metro Washington Field Office, by the West Manchester Township Police Department, York, Pennsylvania. The information provided was that Christopher Davis, an Internal Medicine physician, was arrested on October 2, 2001, and charged with burglary because he broke into his former medical practice.

Davis admitted to breaking in to the office in order to steal Nubain (Nalbuphine HCl) from the drug storage drawer in the facility. Davis admitted to a five-year drug addiction problem with this drug which is an injectable potent, analgesic intended for moderate to severe pain. Additionally, OCI was advised that Davis admitted tampering with the Nubain over a number of years both while employed at the clinic and afterwards, by injecting saline solution back into the vials after removing some of the Nubain for personal use.

On July 9, 2002, Assistant U.S. Attorney Daniel filed a one count felony information in the U.S. District Court, Middle District of Pennsylvania. The information charged Davis with a violation of 21 U.S.C. §§ 331(a); 333(a)(2) - Introduction into Interstate Commerce of Adulterated Drugs.

On July 29, 2002, Davis was convicted of 1 felony count of 21 U.S.C. §§ 331(b) and 333(a)(2) -Introduction into Interstate Commerce of Adulterated Drugs.

On May 2, 2003, Davis was sentenced to 2 years supervised probation and ordered to pay a $500.00 fine.

This case was investigated by OCI and the West Manchester Township Police Department, York, Pennsylvania.

Circuit Court Reverses Decision in Nitrous Oxide Case

OCI’s Metro Washington Field Office initiated this investigation based on information received that several individuals would be distributing illegal nitrous oxide during a concert by the Dave Mathews Band. The concert date was scheduled for June 9, 2001, at RFK Stadium in Washington, DC.

On May 8, 2001, a meeting was held at the United States Attorney’s Office, District of Columbia. In attendance were OCI’s (FDA/OCI), the Metropolitan Police Department (MPD), Narcotics and Special Investigation Division, and the Deputy Chief, Narcotics Section, U.S. Attorneys Office. The Deputy Chief agreed to support a joint operation to conduct probable cause arrests during the concert if illegal activity was identified. The probable cause arrests would be based on the unlawful distribution of a misbranded prescription drug.

On June 9, 2001, 17 probable cause arrests were executed on individuals selling nitrous oxide in balloons. Subsequent to the arrests, the FDA’s Forensic Chemistry Center (FCC), conducted a sampling of the tanks alleged to contain nitrous oxide. The FCC confirmed that the contents in the tanks sampled were consistent with nitrous oxide.

On July 31, 2001, all charges were dismissed by the U. S. Magistrate presiding over the matter based on an interpretation that the Federal Food, Drug, and Cosmetic Act was not intended to apply to individuals, but to manufacturers, distributors and professionals such as physicians and pharmacists.

On August 1, 2001, the government filed a Notice of Appeal to the Chief Judge, U. S. District Court, Washington, D.C.

On November 29, 2001, the Chief Judge issued a Memorandum Opinion reversing the previous ruling and ordered that all cases be reinstated.

Eight defendants were convicted of 21 U.S.C. §§ 331(a), 333(a)(1), 353(b)(1), and 352(f)(2) – Distribution of a Misbranded Drug.

As a result of this investigation, there were 17 arrests, 8 convictions, 3 dismissals. Six defendants were placed into a pretrial diversion program. In a pre trial diversion program, convictions are withheld for one year pending good behavior. If, at the end of that period, the defendant has not been involved in further criminal activity, the charges are dismissed. This case was investigated by OCI and the Metropolitan Police Department.

Illegal Prescription Drug Diversion

OCI Investigations Result in Five Convictions for Criminal Activity Including Mail Fraud, Conspiracy, and Illegal Diversion of Drug Samples

Previously, in 1995, the FDA’s OCI’s Los Angeles Field Office (LAFO), initiated numerous investigations of persons and businesses involved in illegal prescription (Rx) drug diversion schemes. As a result of these investigations, the scope and volume of prescription drug diversion activities was identified. The LAFO subsequently established an undercover wholesale company to facilitate the investigation and identification of buyers, sellers and/or brokers involved in the fraudulent diversion of prescription drug products.

In April 1995, the LAFO initiated an undercover operation to corroborate intelligence relative to prescription drug diversion activities by the Las Vegas Pharmaceutical Distributors, Inc., (LVPD). LVPD was a secondary pharmaceutical wholesaler, located in Las Vegas, Nevada. Incident to the investigation of LVPD, a second diversion network operated by Health Express, Inc., Las Vegas, Nevada, was also identified as supplying large quantities of diverted prescription drug products to LVPD.

This investigation and undercover operation revealed that LVPD utilized commissioned brokers to canvass and recruit closed-door/institutional pharmacies nationwide to purchase millions of dollars worth of prescription drug products at or below wholesale cost. The prescription drugs were purportedly destined for use by nursing homes or other institutionalized patients.

The closed door/institutional pharmacy then illegally diverted the products to LVPD for subsequent re-sale to other secondary wholesalers at substantial profits. LVPD was operated by Benjamin Ross, a son-in-law of the Chief Executive Officer of LVPD. An associated wholesale business of LVPD, C.D. Smith, was operated by another son-in-law of the CEO and was utilized by LVPD to “wash” the pedigree (paper trail) of the diverted prescription drug products so as not to reveal the closed-door/institutional pharmacies as the original sources of the drugs.

C.D. Smith was purportedly able to legitimately purchase prescription drug products directly from approximately 300 pharmaceutical manufacturers. The direct purchase authority of C.D. Smith enabled LVPD to covertly transfer their illegally purchased products to C.D. Smith and then buy them back. The pedigree only reflected the “legitimate sale” from C.D. Smith to LVPD.

Additionally, investigation and undercover contacts disclosed that LVPD had a business relationship with the Bindley Western Drug Company (B/W), San Dimas, California Division, whereby LVPD returned diverted prescription drug products for credit. The Bindley Western Drug Company, home offices in Indianapolis, Indiana, was one of the top ten drug wholesalers in the United States. The undercover operation revealed aggressive “kickback” and diversion schemes with closed-door/institutional pharmacies. These schemes were perpetrated by the San Dimas California Division management team headed by David Brinkley and Steven Wathen.

OCI’s undercover operation also corroborated information provided by various confidential sources that the corporate offices of Bindley Western Drug Company had tacit knowledge of and involvement in the illicit prescription drug diversion activities.

On April 9, 1997, OCI and the Federal Bureau of Investigation (FBI) served federal search warrants at LVPD and Health Express, Inc. The search warrants resulted in the seizure of thousands of documents and records which led to the identification of additional entities engaged in the illegal diversion activities. Concurrent with the search warrants, numerous federal grand jury subpoenas were served on known closed door/institutional pharmacy sources located throughout the United States who engaged in prescription drug diversion activities with LVPD.

Another tangent of the investigation was the identification of a second fraudulent scheme between Lawrence Ray, formerly employed as a District Sales Manager for Fisons Pharmaceutical Corporation, Salt Lake City, Utah, and LVPD. Ray illegally sold to LVPD more than $500,000 worth of prescription drug samples which were intended solely for promotional purposes to physicians.

LVPD falsely categorized the monies paid for the drug samples as “consulting fees” and coached Ray in the proper responses should he be questioned by law enforcement.
On February 4, 2000, Ross was convicted of 18 U.S.C. § 371- Conspiracy to Commit Mail Fraud. LVPD ceased all operations and is now defunct. Ross was sentenced to 6 months home confinement and 3 years formal probation.

On February 18 1998, Ray was convicted of 18 U.S.C. § 371- Conspiracy to Transport Stolen Goods in Interstate Commerce; and 21 U.S.C. § 331(t) - Illegal Diversion of Drug Samples. Ray was sentenced to 15 months in federal prison and ordered to pay a criminal fine in the amount of $5,000.

On August 28, 2000, Bindley Western Drug Company, Indianapolis, Indiana, was convicted of 18 U.S.C. § 371- Conspiracy to Transport Goods and/or Property Obtained by Fraud. Bindley Western Drug Company was ordered to pay a criminal fine in the amount of $20 million dollars.

On October 5, 1999, Brinkley was convicted of 18 U.S.C. § 371- Conspiracy to Commit Mail Fraud. Brinkley was sentenced to 2 years formal probation.

On February 26, 2001, Wathen, was convicted of 18 U.S.C. § 371- Conspiracy to Transport Stolen Goods. Wathen was sentenced to 1 year formal probation and ordered to pay a criminal fine in the amount of $1,000.

Diversion of Pharmaceutical Drugs

OCI’s New York Field Office initiated this investigation in October 1998. Over the course of several years, James Duncan, a Proctor and Gamble representative, diverted and sold pharmaceutical drugs.

On January 9, 2002, Duncan was arrested at his residence by the OCI and the Federal Bureau of Investigation. Duncan had previously rejected a plea agreement offered to him by the United States Attorney’s Office, Eastern District of New York.

At the time of his arrest, Duncan was found to be in possession of 11 registered handguns that were subsequently seized by the Suffolk County Licensing Bureau. As a condition of his release, Duncan surrendered several rifles, approximately 250,000 rounds of ammunition, and a flak jacket to the Suffolk County Police Department. In addition to small quantities of several types of prescription drugs seized at Duncan’s residence, pursuant to a search warrant, 134 boxes of Prilosec physician samples were seized.

On July 23, 2002, Duncan was convicted of 18 U.S.C. § 371- Conspiracy; 21 U.S.C. § 331(t) and § 353(c) (1) - Knowingly and Intentionally Conspiring to Sell and Trade Drug Samples; and 26 U.S.C. § 7206 (1) - Filing a False Tax Return.

On February 21, 2003, Duncan was sentenced to 21 months incarceration.

Pharmaceutical Firm Violate Prescription Drug Marketing Act

Firm Agrees to Pay $355 Million to in Criminal and Civil Liabilities

OCI’s Metro Washington Field Office initiated this investigation in early 1997, based upon a qui tam suit filed in the Eastern District of Pennsylvania. The case involved a conspiracy by the firm and medical doctors to violate the Prescription Drug Marketing Act (PDMA) by billing patients, Medicare, Medicaid and other federally funded insurance programs, for doses of Zoladex, a drug used in the treatment of prostate cancer, that had been provided free of charge by AstraZeneca.

OCI’s investigation determined that employees of AstraZeneca provided thousands of free samples of Zoladex to physicians knowing and expecting that certain of those physicians would prescribe and administer the free drug samples to their patients and then bill those free samples to the patients and federally funded insurance programs. The company also induced physicians to purchase Zoladex by paying illegal remuneration in various forms including free Zoladex, unrestricted educational grants, business assistance grants and services, travel and entertainment, consulting services and honoraria.

On June 20, 2003, AstraZeneca pled guilty to a 1 felony count of 21 U.S.C. §§ 353(c), 331(t) and 333(b)(a)(B) - Sale of Drug Samples; and 18 U.S.C. § 371 - Conspiracy. AstraZeneca was sentenced to pay a $63,872,156.00 criminal fine.

AstraZeneca also agreed to settle its civil liabilities and to resolve allegations that its fraudulent drug pricing schemes and sales and marketing misconduct had caused false and fraudulent claims to be filed with federal and state health care programs. The agreed payments are $266,127,844.00 to the U.S. government for claims filed with the Medicare, TriCare, U. S. Department of Defense and the Railroad Retirement Board Medicare programs, and a total of $24,900,000.00 to the U.S. and state governments for claims involving state Medicaid programs.

In total AstraZeneca agreed to pay $355,000,000.00 to resolve the criminal charges and civil liabilities. Charges have been brought against three physicians for their role in conspiring to bill for free Zoladex samples.

Pharmacist Stole and Diverted Hospital Drugs

This case originated on September 29, 1999, based on information provided by the Kaleida Health organization. The Kaleida Health organization alleged that a hospital pharmacist, Charles George, had stolen and diverted hospital drugs to his own pharmacy for re-sale. OCI’s New York Field Office conducted this investigation with members of the Western New York Health Care Fraud Task Force.

The Western New York Health Care Fraud Task Force is staffed with Special Agents from the Federal Bureau of Investigation, the U. S. Postal Inspections Service, the Department of Health and Human Services - Office of the Inspector General, and the Internal Revenue Service.

During the course of this investigation, volumes of hospital pharmacy records, as well as, George’s bank records and inventory records from his personally owned pharmacy were reviewed. During this review, it was discovered that several prescriptions belonging to several relatives of George appeared to have been altered and increased in both pill and refill quantities. Interviews conducted with the prescribing physicians verified that the altering of the subject prescriptions was not authorized. Handwriting analysis confirmed that the subject prescriptions had been forged.

On September 11, 2002, George appeared in U.S. Magistrate’s Court in Buffalo, New York, and was convicted of 1 count of 21 U.S.C. § 331(k) and 331 (a) (1) - Misbranding a Prescription Drug after Shipment in Interstate Commerce.

On December 18, 2002, George was sentenced to 1 year probation and a $5,000 fine. The New York State Office of Professional Discipline is currently conducting a disciplinary/license revocation investigation.

OCI/Customs Investigates Illegal Importation of Prescription Drugs

OCI Investigation Results in 23-Month Prison Sentence for Smuggling Rx Drugs

OCI’s Kansas City Field Office conducted a joint investigation with the U.S. Customs and Border Protection. The investigation determined that since February 25, 2002, Pedro Rodriguez had made three attempts to smuggle commercial quantities of prescription drugs from Mexico into the U.S. On June 18 2002, Rodriguez, was indicted by a Federal Grand Jury in the Southern District of Texas (Laredo, Texas). The indictment charged seventeen 17 criminal counts.

On August 21 2002, Rodriguez was convicted of 21 U.S.C. § 331(a) - Introduction and Delivery of Misbranded Drugs into Interstate Commerce; 18 U.S.C. § 1001- False Statements; and 18 U.S.C. § 545 - Illegal Importation.

On February 12, 2003, Chief United States District Judge George P. Kazen sentenced Rodriguez to 23 months incarceration.

Counterfeiting

OCI Investigates Counterfeit Dietary Supplements

On October 3, 2001, OCI’s New York Field Office received information from the U.S. Attorney’s Office, Eastern District of Philadelphia, and the Federal Bureau of Investigation that Scott Knox and Theodore Sosangelis, the owners of East Coast Ingredients, 211 South Street, Philadelphia, Pennsylvania, were misbranding, distributing, and trafficking in counterfeit dietary supplement products.

Knox and Sosangelis conspired to distribute counterfeit dietary supplement products through their company, East Coast Ingredients. They manufactured a different version of the dietary supplement products manufactured by Muscletech. They then placed counterfeit Muscletech labels on these counterfeit products, and distributed and sold these counterfeit dietary supplement products to customers who believed that they were purchasing legitimate Muscletech products.

On October 1, 2001 and February 13, 2002, Sosangelis and Knox were convicted of 18 U.S.C. § 2320 – Trafficking in Counterfeit Goods. On October 31, 2002, Sosangelis was sentenced to pay restitution in the amount of $76,728.40.00 and placed on supervised release for 3 years. On January 24, 2003, Knox was sentenced to 18 months incarceration and ordered to pay restitution in the amount of $26,726.40. Knox was placed on supervised release for 2 years.

Counterfeiting of Pharmaceuticals Drugs

OCI Investigation Uncovers Counterfeit Procrit

OCI’s Miami Field Office initiated this investigation based on information received from private industry. The OCI investigation developed conclusive evidence that William Chavez and Duviel Gonzalez were involved with the wholesale distribution of counterfeit Procrit without a license. The investigation also identified Eddy Gorrin as the person responsible for manufacturing the counterfeit Procrit.

On August 29, 2003, Chavez was convicted of violating 21 U.S.C. § 353(e)(2)(a)-Wholesaling without a License. Chavez was sentenced to 3 months incarceration, 3 months home confinement, 3 years probation, and ordered to pay $24,000.00 in restitution.

On August 29, 2003, Gonzalez was convicted of violating 21 U.S.C. § 353(e)(2)(a)-Wholesaling without a License. Gonzalez was sentenced to 6 months home detention, 3 years probation, and ordered to pay $3,000.00 in restitution.

On September 3, 2003, Gorrin was convicted of violating 18 U.S.C. § 2320 - Trafficking in Counterfeit Goods. Gorrin was sentenced to 37 months incarceration, 3 years probation, and ordered to pay $3,000.00 in restitution.

OCI Investigates Unapproved, Misbranded and Adulterated Drugs and Smuggling

OCI/DEA and Kansas Police Investigate Unapproved, Misbranded and Adulterated Drugs and Smuggling

OCI’s Kansas City Field Office initiated this investigation based on information received from the Wichita, Kansas Police Department, Narcotics Division. “Vermox” and an unknown pain remedy “nordin” were sold without a preseription by Fruteria San Miguel, a grocery store.

The Vermox, 30-ml solution, and the Nordin tablets were labeled entirely in Spanish, with no NDC numbers. Prescription strength Vermox is approved in the U.S. in chewable form only. Vermox or its active ingredient cannot be purchased over-the-counter within the United States.

Over a several month period, Fruteria San Miguel sold prescription and unapproved drugs, including the antibiotics, tetracycline, ampicillin and amoxicillin, plus the pain remedy, Nordin tablets. FCC analysis determined that the Nordin tablets contained the prohibited ingredient phenacetin. In 1983, in a Federal Register announcement, drugs containing phenacetin were removed from the U.S. market due to the “high potential for harm to the kidneys and the possibility of hemolytic anemia and methemoglobinemia resulting from abuse.”

On July 10, 2002, a federal search warrant was executed at the business premises of the Fruteria San Miguel. During the execution of the search warrant, hundreds of Spanish labeled pharmaceuticals including antibiotics were seized. In addition, several English labeled, sample prescription pharmaceuticals were discovered. Many of the Spanish labeled drugs were later determined to be prescription pharmaceuticals or unapproved new drugs when marketed within the United States.

On June 2, 2003, Socorro Garcia Castillo, wife of Hugo Ivan Castillo, was convicted of violating 21 U.S.C. § 331(a) - Introducing Misbranded and Adulterated Drugs into Interstate Commerce. On August 13, 2003, Castillo was sentenced to 12 months probation.

Diversion of Pharmaceuticals and Counterfeit Drugs

OCI/Miami Police and Florida Dept. of Health Investigate Illegal Sale of Rx Drugs

OCI opened this investigation at the request of the U.S. Attorney's Office for the Southern District of Florida. The U.S. Attorney had received a referral of a pharmaceutical diversion case from the Miami Police Department and the Florida Department of Health. Information in the case disclosed that Eliseo Martinez grossed $17 million dollars selling prescription drugs including the sale of 325 boxes of counterfeit Neupogen.

On April 28, 2003, Martinez was convicted of violating 21 U.S.C. § 353(e)(2)(a) -Selling Prescription Drugs without a Wholesale License. On August 1, 2003, Martinez was sentenced to 1 year incarceration and ordered to pay a $10,000 fine.

Tampering

Tampering with Over-the-Counter Drug

On March 28, 2003, OCI’s Chicago Field Office received information regarding the possible tampering of "over-the-counter" medications. The case involved the alleged tampering of a box of Aleve Cold & Sinus medication and a bottle of Tylenol PM. The tampering occurred at a local Jewel/Osco grocery store located at 6430 W. Irving Park Road, Chicago, Illinois. In both instances, the genuine product was replaced with vitamin “C” capsules. This case was investigated by OCI, Chicago Field Office, and the Chicago Police Department (CPD).

Investigators gathered information that 1 box of Aleve Cold & Sinus had recently been returned to the Jewel/Osco store, but no further information pertaining to the return was available. Further, the Jewel/Osco store also confirmed that 2 bottles of Tylenol PM had recently been returned and in one of the returns, a name and address was listed. The Jewel/Osco store had a return of Tylenol PM on file dated March 11, 2003, with the customer listed as Michelle Bujak, 15042 S. Tripp, Midlothian, Illinois.

Subsequent checks on this address by the Midlothian Police Department revealed that Bujak’s parents resided there.

On April 10, 2003, through additional investigative efforts, Bujak voluntarily appeared at the Area 5 Headquarters, CPD, and was interviewed. During the interview of Bujak, she confessed to the tampering of both products. Bujak stated that in both cases she removed the medication and replaced it with “multi-vitamins.” Bujak stated her motivation was to “get money for groceries” by returning the tampered products. Bujak had no prior criminal history.

The Office of the United States Attorney, Northern District of Illinois, was consulted and deferred prosecution to the State of Illinois authorities. Bujak was charged with Theft by Deceptive Practices by the State of Illinois.

On May 12, 2003, Bujak appeared in Cook County Court and was convicted of 1 count of Theft by Deceptive Practices. Bujak was sentenced to 6 months of court supervision.

Tampering With Consumer Drug

OCI’s Kansas City Field Office initiated this investigation based upon information from another case in the Kansas City area. OCI’s investigation led to the identification of several pharmacists, and a doctor in the Kansas City area who were involved in the sale and/or purchase of drug samples and stolen drugs. OCI investigated this case with the Federal Bureau of Investigation.

The investigation revealed that Steuart W. Smith, a pharmacy buyer for the in-house pharmacy at the University of Colorado Hospital in Denver, Colorado, was the source of the stolen drugs that Robert Courtney had purchased from Aram C. Paraghamian and Walter J. Accurso, retired pharmaceutical representatives. Paraghamian and Accurso then made subsequent sales to two Kansas City pharmacists, Clarence H. Winer and Gary S. Ravis.

The investigation also determined that Dr. Stephen M. Cicero sold drug samples worth approximately $30,000 to Ravis during the time period 1996 to 2001.

On September 25, 2001, “stolen” drugs that were previously ordered by Winer and Ravis were delivered to Winer and Ravis. Winer and Ravis were subsequently confronted with the sales of the stolen drugs. Both were served with document subpoenas for pharmacy records.

Smith confessed to stealing pharmaceuticals from the hospital for approximately the past eight years. Smith believed that he had profited approximately $50,000 from these illegal sales.

On December 17, 2001, Ravis was convicted of 18 U.S.C. § 2315- Receipt of Stolen Goods. Ravis was later sentenced to 6 months of monitored home detention, 5 years probation, and fined $250,000.

On January 10, 2002, Accurso entered into a Consent Decree and Permanent Injunction in which $8,650 in proceeds from illegal transactions of stolen drugs that traveled in interstate commerce were surrendered for forfeiture. Accurso also agreed to pay $25,000 as an equitable disgorgement remedy under the Food, Drug, and Cosmetic Act for his conduct.

On March 21 2002, Paraghamian pled guilty to 1 count of 18 U.S.C. § 2314- Interstate Transportation of Stolen Property. Paraghamian was later sentenced to 6 months of home detention, 3 years probation, and fined $60,000.

On April 4, 2002, Smith was convicted of 21 U.S.C. §§ 331(t), 333(a)(2) and 353 (c)(3) (A)(ii)(I)- Unlawful Sale of Hospital Drugs. Smith was later sentenced to 6 months of home detention, 5 years probation, ordered to pay the University of Colorado Hospital $50,000 in restitution, and fined $25,000.

On September 27, 2002, Winer was convicted of 21 U.S.C. §§ 353 (e)(2)(A), 331(t) and 333(b)(1)(D) - Wholesale Distribution of Prescription Drugs Without a License. Winer was also convicted of 18 U.S.C. § 2- Aiding and Abetting. Winer was later sentenced to 6 months of home detention, 3 years probation, and fined $100,000.

On October 24, 2002, Dr. Stephen M. Cicero was convicted of 21 U.S.C. §§ 331(t), 333(b)(1) and 353(c)(1) - Selling of Drug Samples. Cicero was later sentenced to 6 months of home detention, 2 years probation, and fined $30,000.

Tampering with Narcotic Drugs

Registered Nurse Found Substituting Narcotic with Water

OCI’s Miami Field Office investigated a tampering incident involving approximately 23 syringes of Demerol Meperidine HCl by Jane Clements. Clements, a registered nurse at the time, was employed at the Hale County Hospital, located in Greensboro, Alabama. Clements removed the labeled narcotic and substituted the drug with sterile water.

Clements was convicted of violating 18 U.S.C. § 1365(a)(4) - Tampering with Consumer Products. On September 17, 2003, Clements was sentenced to 51 months incarceration, 3 years probation, payment of restitution to the hospital for the value of the stolen drugs, and ordered to enter substance abuse treatment program.

Hospitals Alerted When Pain Medication Did Not Relieve Pain

OCI Investigation Finds Registered Nurse Tampering With Morphine, Demeral, Mepergan, and Imitrex

OCI’s Chicago Field Office investigation involved allegations that Debra Dyer-Pagel, a Registered Nurse (RN) in the Emergency Room (ER), Northfield Hospital, Northfield, Minnesota, tampered with Morphine, Meperidine (Demerol), Mepergan, and Imitrex. Hospital officials initially were alerted to the tampered containers when patients received pain medication, such as Morphine, but did not receive pain relief. Hospital officials subsequently scrutinized the containers.

The containers of Morphine, Meperidine, and Imitrex appeared to have had liquid contents in them. However, the lids appeared to have been glued on. The plastic sheath container for the Mepergan vials appeared to have been torn, and liquid contents were in the individual Mepergan vials.

The containers that were allegedly tampered with were analyzed by the FDA’s Forensic Chemistry Center (FCC). The FCC concluded that the containers had evidence of glue, puncture indentations, and/or contained other substances (e.g., saline solution) which should not have been present.

On December 17, 2002, Dyer-Pagel was convicted of 1 count of 18 U.S.C. § 1347 - Health Care Fraud. On March 5, 2003, Dyer-Pagel appeared before Judge Donovan Frank, District of Minnesota (St. Paul, Minnesota), and was sentenced to 3 years
probation.

Tampering with Consumer Product Results in Prison Sentence

OCI/FBI Investigation Results In Confession of Tampering and False Statements

The Miami Field Office of OCI initiated this investigation pursuant to a referral from the Federal Bureau of Investigation (FBI) in Lafayette, Louisiana. The case involved a tampering incident that occurred on January 9, 2003, at a McDonald's restaurant located in Eunice, Louisiana. This restaurant was the victim of a prior tampering incident in November 2002, in which a former store employee was subsequently charged with placing razor blades inside apple pies.

Based upon the investigation, it was determined that Barbara Pousson committed a copy-cat tampering and reported to the McDonald’s restaurant that she found a staple inside a breakfast burrito sandwich. Pousson made false statements regarding the incident when she was interviewed on January 10, 2003.

Pousson subsequently confessed to her false statement during a re-interview by OCI and FBI agents on January 30, 2003. On March 16, 2003, Pousson appeared before U.S. Magistrate Judge Tucker Melancon, Western District of Louisiana and was convicted of violating 18 U.S. C. § 1001- False Statements. On July 16, 2003, Pousson was sentenced to 24 months probation, and ordered to pay a fine of $7,710.16.

Controlled Substances

Defendant Obtains False DEA License – Writes 150 Prescriptions

OCI Works with Montgomery County MD Police in Investigation of “physician” Obtaining Controlled Substances

OCI’s Washington Field Office initiated this investigation following a request for assistance by the Montgomery County, Maryland, Police Department. Montgomery County Police executed a state search warrant on October 9, 2001, at the residence of David Michael Larson. Larson was arrested pursuant to an arrest warrant for obtaining a Controlled Drug Substance (CDS) by fraud, altering a prescription, representing himself as a medical doctor, and forging a prescription.

The investigation, conducted by OCI and the Montgomery County Police Department, revealed that Larson, who is not a physician, unlawfully obtained information about two physicians with similar names. Larson then used those names to obtain a DEA license number and a Maryland drug control license to distribute controlled substances.

Larson created more than 150 false prescriptions to illegally obtain Oxycodone, Hydrocodone and other drugs from pharmacies. The prescriptions were in the names of several individuals, two of whom have also been charged with controlled drug violations. Larson also used one of the physician’s personal information to obtain credit cards to purchase more than $45,000 worth of computer equipment, groceries and to pay the real estate taxes for his residence.

On August 21, 2002, a Federal Grand Jury in the Southern District of Maryland indicted Larson on violations of 21 U.S.C. § 846 - Conspiracy to Possess with Intent to Distribute and Distribution of Schedule II and III Controlled Substances; 21 U.S.C. § 843(a)(3)- Possession of a Controlled Substance by Fraud; 21 U.S.C. §§ 331(k) and 333(a)(2) -Introduction into Interstate Commerce of a Misbranded Drug; 18 U.S.C. § 1028(a)(7) - Possession of a Fraudulent Use of a Means of Identification; 18 U.S.C. § 1029(a)(2) -Unauthorized Use of an Access Device; and 18 U.S.C. § 2-Aiding and Abetting.

On April 17, 2003, Larson was convicted of 21 U.S.C. § 846 - Conspiracy to Possess with Intent to Distribute and Distribution of Schedule II and III Controlled Substances; and 18 U.S.C. § 1029(a)(2) -Unauthorized Use of an Access Device.

On July 21, 2003, Larson was sentenced to serve 37 months incarceration, ordered to pay $48,470.52 in restitution to the credit card companies, and 3 years supervised probation upon release from custody.

Two co-conspirators of Larson were also convicted and sentenced. Joyce Mendelson was convicted of violating 21 U.S.C. § 843- Distribution of Controlled Substances.

Mendelson was sentenced to 2 years supervised probation. Janie Moore was convicted of violating 21 U.S.C. § 846- Conspiracy to Possess with Intent to Distribute Controlled Substances. Moore was sentenced to 6 months incarceration, 6 months home detention, 100 hours of community service and 3 years supervised probation.

Unlabeled Diet Pills Found To Contain Amphetamines

OCI, Texas Dept. of Public Safety, U.S. Postal Services, FDA’s Kansas City Office Work Together in Diet Drug Investigation

OCI’s Kansas City Field Office investigated a case involving the sale of unlabeled/adulterated diet drugs in Pasadena, Texas, by an alleged medical doctor from Mexico. The alleged doctor, Dagoberto Paz-Tamex, was not licensed to practice medicine in the State of Texas or anywhere else within the United States. OCI’s Kansas City Field Office received assistance in this investigation from the Harris County Precinct 6 Constable’s Office, the Texas Department of Public Safety (DPS), and the U.S. Postal Inspection Service.

The investigation revealed that Paz-Tamez had been selling unlabeled diet pills to patients for several years in the Pasadena, Texas area. A sample of the diet pills was submitted to the Harris County Precinct 6 Constable’s Office by a confidential informant. These samples were later submitted to FDA’s Forensic Chemistry Center (FCC), and were found to contain amphetamines and other dangerous substances.

On August 22, 2002, Paz-Tamez was arrested in Pasadena, Texas. Diet drugs and U.S. currency were seized consisting of the following: 4,350 tablets, $10,236 in U.S. currency, 30,488 gelatin capsules, and 44.5 pounds total weight of unlabeled diet drugs. The diet pills and tablets seized were found to contain: Mazindol (amphetamine), Diethylpropion (amphetamine), Diazepam (generic for valium), and Hydrochlorothiazide (diuretic).

On March 16, 2003, Paz-Tamez was convicted of Possession of a Controlled Substance and Delivery of a Dangerous Drug. He was later sentenced to 10 years deferred probation.

Customs Discovers Defendant with 2,650 Tablets Containing Codeine

Customs Alerts FDA to Import of 2,650 Tablets of Codeine

On March 20, 2002, OCI’s Minneapolis Domicile received information from the U.S. Customs and Border Protection (Customs), Duluth, Minnesota, that on March 14, 2002, Patrick Schule, Milaca, Minnesota, entered into the United States, through the International Falls, Minnesota, Port of Entry. Upon entry, Schule declared that he was in possession of 50 acetaminophen tablets. A secondary search by Customs revealed that Schule was actually in possession of 2,650 tablets rather than the 50 he had declared. The tablets were labeled “acetaminophen with codeine.”

When asked about these tablets, Schule was unable to provide a valid prescription and claimed that the tablets were for his own “personal use.” These tablets were then seized by Customs, and Schule was allowed entry into the United States.

Forensic analysis conducted on the tablets revealed that they did contain codeine, a Schedule III substance in Minnesota.

On July 18, 2002, a criminal complaint was filed in Koochiching County District Court citing that on or about March 14, 2002, Schule possessed more than 10 grams of a narcotic drug (1,123grams of tablets containing acetaminophen, caffeine, and codeine), a felony controlled substance offense.

On December 9, 2002, Schule appeared in Koochiching County District Court and was convicted of a 3rd degree controlled substance crime.

On February 24, 2003, Schule was sentenced in Koochiching County, Minnesota, to a “Stay of Imposition” for 5 years and 45 days incarceration as a condition of the stayed sentence.

Undercover Investigation Discloses Unlawful
Prescribing of Controlled Substances

Phony Doctor Found Prescribing Controlled Substances

OCI’s Kansas City Field initiated this case based on information regarding the stolen identity of Christina Clardy, M.D., by Eleanor Franks. Franks, posing as Dr. Clardy, treated patients at Horizon Medical Clinic, located in Houston, Texas. Franks prescribed 90 Hydrocodone pills and 60 Valium pills for back pain.

OCI executed a search warrant at the clinic. The clinic’s files revealed that Franks, using three different Drug Enforcement Administration (DEA) numbers, prescribed 200,000 dosage units of Hydrocodone and 100,000 dosage units of Alprazolam for patients. One of the patients seen by Franks died of a drug reaction.

On October 21, 2002, Franks was convicted of violating 21 U.S.C. § 843(a) - Unlawful use of a DEA Registration number; and 21 U.S.C. § 41(a)(1) - Unlawful Distribution of a Controlled Substance. On September 9, 2003, Franks was sentenced to 1 year and 1 day incarceration and 3 years probation.

This was a joint investigation with the Drug Enforcement Administration, Diversion Unit, located in Houston, Texas.

Website Found Selling Rx Drugs Without a Prescription

Morphine Purchased By OCI in Undercover Buy

The FDA’s Kansas Field Office initiated this case based on information that the website, Onlinepillbox.com, was offering the sale of controlled and prescription drugs via the Internet. Onlinepillbox.com advertised prescription drugs for sale via the website by simply placing an order with a credit card, or by direct access to your bank account. No doctor's prescription was required. All orders were prepaid. A review of the website revealed that the drugs came from the Republic of the Philippines. Records revealed the website originated from the Philippines and was hosted from Albuquerque, New Mexico. The registrant for the website was Therapy Information Services. Richard Wilhite ran Onlinepillbox.com from an office in Lufkin, Texas.

A search warrant was executed on Therapy Information Services, revealing that large quantities of drugs had been sold via the website. Further, Wilhite would e-mail persons in the Philippines to place orders he received via this website. The orders were then mailed directly to the persons who ordered the drugs in the U.S. Wilhite was the only person who received funds from these sales.

On September 29, 2003, Wilhite was sentenced to 37 months in federal prison and two years federal probation upon release. Wilhite had previously been convicted of violating Title 21 U.S.C. § 331 (a) – Introduction into Interstate Commerce of Misbranded Drugs.

This case was a joint investigation with the U.S. Customs and Border Protection.

Diversion of Pharmaceuticals

Pharmacist Diverts $3 Million Worth of Pharmaceuticals

OCI initiated this case based on information from the Wyoming State Board of Pharmacy. The case involves the diversion of pharmaceuticals through Central Pharmacy, Inc., Omaha, Nebraska, Capitol Pharmacies, Inc., Cheyenne, Wyoming, and Casper Care Pharmacy, Inc., Casper, Wyoming. Jonathan M. Rosen owned and operated these closed-door pharmacies with related wholesale companies.

On June 3, 1998, the Wyoming State Board of Pharmacy reported possible diversion activities occurring at Casper Care Pharmacy, Inc., and Capitol Pharmacies, Inc. OCI’s investigation revealed that Rosen fraudulently purchased and diverted more than three million dollars worth of pharmaceuticals utilizing these closed-door pharmacies and defrauded drug manufacturers of more than $ 2.1 million dollars.

On April 28, 2003, Rosen was convicted of violating Title 18 U.S.C. §§ 1341 and 2 - Mail Fraud and Aiding and Abetting.

On October 24, 2003, Rosen was sentenced to one year and a day federal incarceration, and ordered to pay restitution in the amount of $2,188,536.50.

Investigation Reveals Physician Providing Hydrocone to Addict

OCI, DEA, FBI, Texas Department of Safety Cooperate in Investigation of Physician

This case was initiated based on information involving the sale of misbranded prescriptions without the benefit of a proper doctor patient relationship. A female durg addict was arrested in her car with several bottles of controlled substances prescribed for a different person. At the time of her arrest the female addict had her children were with her while she was under the influence of the controlled substances. Maxie Sprott wrote numerous prescriptions for her in false names. The female addict admitted to her addiction to hydrocodone, ingesting over sixty pills a day.

On February 23, 2003, Sprott was convicted of violating Title 21 U.S.C. § 853 – Acquiring a Controlled Substance under False Means.

On October 29, 2003, Sprott was sentenced to 3 days in jail and supervised probation for a period of one year. He was also fined $3,000.00. In addition, the Texas Medical Board suspended Sprott from writing prescriptions for controlled drugs for two years.

The case was worked jointly by FDA’s Office of Criminal Investigations, the Drug Enforcement Administration, Diversion Control, the Federal Bureau of Investigation and the Texas Department of Public Safety.

Investigation Discloses Physician Diluting Flu Vaccine

FDA Forensic Analysis Shows Flu Vaccine Diluted With Very Little Vaccine Left

On November 15, 2001, information was received by the Western New York Health Care Fraud Task Force (WNYHCFTF) alleging that Dr. Marvin Galler was diluting flu vaccine which was later administered to his patients. On November 21 2001, members of the WNYHCFTF executed a search warrant at Galler’s office seizing several bottles of suspected adulterated vaccine, suspected liquid used to dilute the vaccine, syringes used to add the liquid to the vaccine, as well as medical records. Galler was interviewed and provided a verbal statement admitting to his adulteration of the above mentioned flu vaccine.

The FDA Forensic Chemistry Center reported that the vaccine seized at Galler’s medical practice was diluted to the point that there was very little vaccine left in the bottles, explaining that one bottle which should have had only 10 puncture holes had 39 puncture holes.

On June 4, 2002, Galler voluntarily surrendered his medical license for a minimum period of 3 years.

On July 7, 2003, Galler appeared in the Western District of New York and was convicted of 1 felony count of Title 21 U.S.C. § 331(k) and 333(a)(2)- Adulteration of a Drug.

On December 10, 2003, Galler appeared in the Western District of New York and was sentenced to 1 year probation during which time he is to continue to receive probation supervised mental health treatment. Galler was also fined $5,000.00.

OCI Assists FBI and DEA Investigation of Mail Order Pharmacy

OCI initiated this investigation following a request for assistance from the Federal Bureau of Investigations’ (FBI) Chicago Division. The FBI was conducting an investigation of Mer Enterprises. Mer Enterprises also operated “The Mail Order Pharmacy” and the website www.success123.com. OCI and the FBI investigation revealed that made undercover purchases of controlled substances and pharmaceuticals that require a physician prescription were being sold by “The Mail Order Pharmacy.” Investigators subsequently identified the operator of the website as Dave Roberts.

The Internet website was operated out of Roberts’ home in Powell, Tennessee. Customers paid fees ranging from $250 for a twelve month “membership” to $500 for a “lifetime membership.” The customers were supplied with passwords that allowed them to view drug price lists and ordering instructions. The cost of the drugs was dramatically inflated.

For example, OxyContin sold for as much as $42 per tablet. At least two customers spent more than $50,000 each and 22 customers spent more than $20,000 each for illegal drugs from the Mail Order Pharmacy. The majority of the illegal controlled substances and pharmaceuticals sold through this website were from Mexico via a pharmacist in Nogales, Sonora, Mexico, identified as Ildelfonzo Breton Esquivel. In total, the website’s revenue from the drug sales was approximately $2.2 million dollars.

On August 27, 2002, federal agents served a search warrant at the residence of Roberts. During the search warrant, Roberts was interviewed and acknowledged that members of his website were able to purchase controlled substances and pharmaceuticals without a physician’s prescription. Roberts identified the drug sources, as well as other individuals who assisted him in his enterprise. One individual was Jae M. Rooney, a Registered Nurse who assisted Roberts in the operation of the website.

On September 20, 2002, Roberts was convicted of violations of 21 U.S.C. § 846 - Conspiracy to Illegally Dispense, Distribute, and Possess with Intent to Distribute Controlled Substances; 21 U.S.C. § 841(a)(1) – Illegal Dispensation and Distribution of Schedule II Controlled Substances; 21 U.S.C. § 861(a)(1) – Use of a Minor to Distribute Controlled Substances; and 18 U.S.C. § 371 – Conspiracy to Commit Offenses against the United States (Introduction into Interstate Commerce of a Misbranded Drug).

On November 14, 2002, federal agents served a search warrant on Frank Assaf in Tucson, Arizona. Assaf was a business executive for the Sierra Tile Company located in Tucson, Arizona. Assaf was identified as a co-conspirator with Roberts in the scheme to import and distribute controlled substances and pharmaceuticals.

Assaf kept an inventory of controlled substances at his residence, including 50,200 tablets, pills, and ampoules which agents seized from his house during the search. He also had three computers that he used to keep a sophisticated inventory, order delivery, and accounting systems for the drug business. Assaf had set up an elaborate security system to evade law enforcement. Assaf corroborated Roberts’s statements and identified Maria E. Hernandez as a co-conspirator.

On December 17, 2002, Assaf, Hernandez, and Rooney were indicted on multiple controlled drug charges.

On January 15, 2003, Roberts was sentenced to 57 months incarceration and seventy-two 72 months probation in the Eastern District of Tennessee.

On March 11, 2003, Hernandez was convicted of violating 21 U.S.C. § 846 – Conspiracy to Illegally Distribute and Possess with Intent to Distribute a Controlled Substance; and 21 U.S.C. § 841 (a) (1) – Illegal Distribution and Possession with the Intent to Distribute a Controlled Substance. On June 3, 2003, Hernandez was sentenced to 24 months incarceration and 36 months probation in the Eastern District of Tennessee. After serving her term of incarceration, Hernandez, an Ecuadorian national, will be deported to Ecuador.

On March 27, 2003, Rooney was convicted of violating 21 U.S.C. § 846 – Conspiracy to Illegally Distribute and Possess with Intent to Distribute a Controlled Substance; and 21 U.S.C. § 841(a)(1) – Illegal Distribution and Possession with the Intent to Distribute a Controlled Substance. On July 15, 2003, Rooney was sentenced to 46 months incarceration and 36 months probation in the Eastern District of Tennessee.

On August 11, 2003, Assaf was convicted of violations of 21 U.S.C. § 841(a)(1) – Illegal Dispensation and Distribution of Schedule II Controlled Substances; 21 U.S.C. § 846 – Attempt or Conspiracy to violate the Controlled Substances Act; and 18 U.S.C. § 2 – Aiding and Abetting. Assaf was sentenced to 44 months incarceration and 36 months probation in the Eastern District of Tennessee. Assaf forfeited $169,905 to the federal government.

This was a joint investigation involving the OCI Chicago Field Office, DEA Diversion, Chicago Division and the FBI, Chicago and Knoxville Field Offices.

Administration of Unapproved Drugs for Treatment of Cancer

In Lieu of Chemotherapy Medical Center Provides Unapproved Drugs – Bills Insurance Co. $2 Million

OCI’s Chicago Field Office initiated this investigation following a request from the Highland, Indiana, Police Department (HPD). Investigators related that employees of Highland Medical Center (HMC), were engaged in the administration of unapproved drugs for the treatment of cancer.

On August 1, 1996, a search warrant was issued. Pursuant to this warrant, agents seized the following from HMC: unapproved drugs, patient medical records, business records, and other items associated with the receipt and utilization of unapproved drugs.
Subsequent investigation revealed that HMC had submitted over $2 million dollars in fraudulent insurance claims to dozens of private insurance companies for chemotherapy, when no chemotherapy had been provided. In lieu of chemotherapy, HMC administered the unapproved drugs. In addition, Dr. Wilbert C. Streeter, (HMC’s Owner), Jerry A. Averill (Business Administrator), Walter T. (Tom) Konhorst (Purchasing Agent), and Geraldine Cobb (Bookkeeper), were engaged in the laundering of the insurance checks issued in payment of the fraudulent insurance claims to avoid reporting requirements to the Internal Revenue Service.

Furthermore, Streeter and Konhorst were involved in a conspiracy to solicit and receive Medicare kickbacks from Robert G. Waite, owner of ProPharma Sterile Products, Inc. The kickbacks were paid for the referral of patients from HMC to ProPharma.

On November 28, 2000, Robert Waite was convicted of violating 18 U.S.C. § 2 -Aiding and Abetting, and 18 U.S.C. § 664 -Theft/Embezzlement from Employee Benefit Plan. On July 9, 2002, Robert G. Waite was sentenced to 18 months incarceration, 3 years probation, and ordered to make restitution of $ 309,146.00 jointly and severally with Darlene Waite.

On January 19, 2001, Darlene Waite was convicted of violating 18 U. S.C. § 2 -Aiding and Abetting, and 18 U.S.C. § 664 -Theft/Embezzlement from Employee Benefit Plan. On July 11, 2002, Darlene Waite was sentenced to 18 months incarceration, 3 years probation, and ordered to make restitution of $ 309,146.00 jointly and severally with Robert G. Waite.

On November 19, 2001, Averill was convicted of violating 18 U.S.C. § 371 –Conspiracy; 18 U.S.C. § 1341 -Mail Fraud; 18 U.S.C. § 1956(h) – Conspiracy to Commit Money Laundering; and 18 U.S.C. § 1956(a)(1)(A)(i) -Money Laundering. On June 12, 2002, Averill was sentenced to 21 months incarceration and 3 years probation. Averill was ordered to pay restitution of $1,902,382.00 jointly and severally with the other defendants.

On November 20, 2001, Konhorst was convicted of violating 18 U.S.C. § 1341 - Mail Fraud; and 18 U.S.C. § 1956(h) –Conspiracy to Commit Money Laundering. On April 22, 2003, Konhorst was sentenced to 12 months probation and ordered to pay restitution of $1,902,382.00 jointly and severally with the other defendants.

On January 25, 2002, Streeter was convicted of violating 18 U.S.C. § 1956(a)(1)(A)(i) -Money Laundering. On February 12, 2003, Streeter was sentenced to 21 months incarceration and 2 years probation. Streeter was ordered to pay restitution of $1,902,382.00 jointly and severally with the other defendants.

Medicare Fraud

OCI and FBI Investigate Medicare Fraud

OCI initiated this investigation based on information received regarding a scheme involving Medicare patients who needed respiratory drugs. This was a joint investigation with the Federal Bureau of Investigation.

Billy Greenwood, as owner of G&G Respiratory, provided medical equipment to Medicare patients. When Greenwood visited patients to set up respiratory equipment he would provide the patient with Albuterol from a pharmacy, The Medicine Shoppe Pharmacy, owned by Robert Harkness. Greenwood then instructed the patient to order their Albuterol through Harkness who billed Medicare for the drug. Each time Harkness provided a patient with Albuterol and billed Medicare he would pay Greenwood $500. When a patient no longer needed respiratory equipment, Greenwood went to the patient’s residence and collected the equipment, along with any unused bottles of Albuterol. Greenwood then removed all prescribing information from the unused Albuterol and dispensed it to the next new patient.

On January 31, 2003, Greenwood was convicted of violating 42 U.S.C. § 1320a-7b (b)(1)(A) - Knowingly receiving kickbacks for referrals where payment is made from a Federal Healthcare Program; and 21 U.S.C. §§ 331(k) - Misbranding of a drug after shipment in interstate commerce. On May 2, 2003, Greenwood was sentenced to 12 months incarceration on each count with the sentences running concurrently. Greenwood was ordered to pay $103,813.44 in restitution.

On July 10, 2003, an agreement for pretrial diversion was finalized for Harkness for violation of 42 U.S.C. §§ 1370a-7b, for paying kickbacks to Greenwood. Harkness was placed on 18 months probation and agreed to pay a $110,000 civil penalty.

OCI and USPIS Uncover Medicare Fraud

Fraud Scheme Costs Medicare $5 Million - 16 Persons Arrested, 15 Convicted

OCI initiated this investigation based on the information provided by the United States Postal Inspection Service (USPIS). USPIS reported an ongoing investigation centered on Super Farmacia El Paseo, a licensed pharmacy, and the activities of the Ignacio Pintado-Garcia. Pintado-Garcia was the owner of the pharmacy as well as the owner of a durable medical equipment company and a coffee production business.

Pintado-Garcia had established an organized group of individuals who coordinated and paid numerous physicians kickbacks for referring patients to his pharmacy and writing questionable prescriptions for Medicare patients for Albuterol Sulfate. The investigation revealed that Pintado-Garcia paid the kickbacks from the accounts of other businesses that he had an interest in, and then reimbursed those interests with payments from Super Farmacia El Paseo.

As a result of the criminal scheme, the U.S. Department of Health and Human Services, Office of the Inspector General, identified losses to the Medicare program at approximately $5,000,000.00.

On September 19, 2002, Pintado-Garcia was convicted and sentenced to 60 months incarceration and ordered to pay $502,871.00 in restitution to the Medicare program.

During the time period from May 2002 to April 2003, thirteen individuals were convicted (nine of them physicians) and eight individuals (five of them physicians) were placed into the Pre-Trial Diversion (PTD) program.

In a pretrial diversion program, convictions are withheld for one year pending good behavior. If at the end of that period, if the defendant has not been involved in further criminal activity, the charges are dismissed.

Illegal Sale of Prescription Drugs and Medicare Fraud

Defendants Found Buying, Renting & Stealing Medicaid Cards

OCI’s New York Field Office initiated this investigation based on information regarding the use of fraudulent prescriptions, diversion of prescription drugs, illegal wholesale prescription drug sales as well as Medicaid fraud and income tax fraud. OCI’s investigation disclosed that for several years an organized group would systematically buy, rent or steal Medicaid cards.

The group would then couple the Medicaid cards with stolen prescription blanks in order to obtain pharmaceutical products. These products would be gathered into bulk lots and resold to pharmacies at a price greatly reduced from the average wholesale price. As the scheme grew, additional pharmacists became co-conspirators. The pharmacists would knowingly solicit and accept false prescriptions, bill Medicaid for the full price, but never dispense the prescription. As pharmacists and others realized how lucrative this scheme had become, they started splinter groups of their own.

Ultimately, sixteen persons were arrested and fifteen were convicted. Eight of the sixteen were pharmacists. One individual remains a New Jersey State fugitive. The scheme was responsible for approximately $5,000,000.00 in fraud.

On April 15, 2003, Godwin Okoye, a pharmacist and medical doctor, was sentenced to 41 months incarceration, 3 years probation and ordered to pay $65,375.65 in restitution. Okoye was previously convicted of violations of 18 U.S.C. § 371 and 21 U.S.C. § 7206(1) - Conspiracy to Sell Unlicensed Wholesale Pharmaceuticals, and Tax Fraud.

On April 15, 2003, Patrick Okoye, a pharmacist, was sentenced to 24 months incarceration, three years probation and ordered to pay a $65,375.65 in restitution. Okoye was previously convicted of 18 U.S.C. § 371 and 21 U.S.C. § 7206(1) Conspiracy to Sell Unlicensed Wholesale Pharmaceuticals, and Tax Fraud.
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On June 11, 2003, Clement Okongwu was ordered to pay a $1,000.00 fine. Okongwu as previously convicted of 21 U.S.C. § 331(a) and 333(a) -Selling Misbranded Drugs.

This investigation involved the following agencies: OCI, the Internal Revenue Service, the Federal Bureau of Investigation, and the State of New Jersey, Department of Law and Public Safety, Division of Criminal Justice.

Gamma Hydroxybutyrate (GHB)

GHB Kits Sold Over the Internet

OCI’s Kansas City Field Office initiated this investigation following information from the Little Rock Police Department regarding a package that was intercepted by the Australian Federal Police. The Customs declaration on the package stated the contents were “computer cleaning supplies.” However, the package contained all the necessary precursor ingredients to manufacture Gamma Hydroxybutyrate (GHB). The package noted a return address located in Little Rock, Arkansas.

Subsequent inquiry by OCI revealed that GHB kits were being marketed and sold as “exothermic reaction” kits via the Internet by a website ghbkit.com. The website was operated by Michael Starks. Starks was doing business as Chem Labs, Inc., and was advertising and selling GHB kits via the Internet.

Despite the ingestion disclaimer, Starks was marketing and selling “do it yourself” GHB kits and providing the necessary ingredients to manufacturer GHB under the guise of a science project. Starks attempted to avoid state and federal laws by marketing and selling not the finished drug, but a kit that contained the components of GHB, Gamma Butyrolactone (GBL) and sodium hydroxide.

GBL is an industrial solvent used for stripping wood floors and cleaning plastic resin molds. Sodium hydroxide is a highly caustic chemical that is an active ingredient in the household cleaning product Drano®. The website resulted in thousands of kits being distributed throughout the world.

On February 3, 1999, a search warrant was conducted at Chem Labs in Little Rock, Arkansas. Subsequent to the search, the website was shut down and the distribution of the GHB kits was terminated. The investigation revealed that the illegal business operated by Starks generated over $700,000 in revenue and also violated the United States Department of Transportation (DOT) regulations by not properly declaring hazardous materials in limited quantities. On July 22, 2002, Starks was convicted of 18 U.S.C. § 371- Conspiracy; and 21 U.S.C. §§ 331(a) and 333(a)(2) - Introduction into Interstate Commerce Misbranded Drugs with the Intent to Defraud and Mislead.

On December 16, 2002, Starks appeared in federal court in the Eastern District of Arkansas for sentencing. Starks was sentenced to 18 months incarceration, and fined $30,000. In addition, Starks forfeited $300,000 to the U.S. Marshals Service in the Eastern District of Arkansas. Starks still faces potential civil sanctions by the DOT.

OCI/DEA Investigation Leads to Prison Sentences

GHB and GBL Promoted Via the Internet

OCI’s New York Field Office initiated this investigation in 1999, based on information received from FDA’s New York District Office. OCI received information reporting that Cabot Industries, 72A Cabot St, Babylon, New York, was distributing a product called Invigorate, which is a substance containing GHB. Invigorate was manufactured by Invigorate International, 83 West 104th St, New York, New York.

Cabot Industries was the only wholesaler for the Invigorate product. The FDA’s New York District Office advised representatives of both Invigorate International and Cabot Industries of the health concerns involved with GHB. Neither company would recall the products. However, it was agreed that no additional product would be sold. A subsequent inspection (approximately two weeks later) revealed that additional product had been distributed.

In both April and June of 1999, two deaths were reported that were attributed directly to the ingestion of Invigorate. The Invigorate ingested was supplied by Cabot Industries. In a parallel investigation, the Drug Enforcement Administration (DEA) was investigating the sale of Invigorate and another product containing GBL marketed under the name Verve. These products were being distributed through the website www.invigorating.com. The individuals operating the website were John Goetz, Claudine Dematos and Scott Ansaldi.

In a parallel investigation conducted by the OCI’s Atlanta Resident Office, the Verve product was found to be manufactured and shipped by Ronald Dean Gates who operated a company, Best Value Product, located in Norcross, Georgia. Three teenagers overdosed on the Verve product in Georgia.

On February 11, 2000, James Codomo, President of Cabot Industries, was convicted of violating 18 U.S.C. § 1001- False Statements. Codomo sent a false document to the Assistant United States Attorney assigned to the civil portion of the case. Codomo was sentenced to 5 years probation.

On February 1, 2002, Dementos was convicted of violating 21 U.S.C. § 846- Conspiracy to Distribute Narcotics. Dementos was sentenced to time served, having spent 5 months incarcerated in pre-trial detention.

On June 6, 2002, Ansaldi and Gates were convicted by a jury in Eastern District of New York federal court. The jury found Ansaldi and Gates guilty of violating 21 U.S.C. § 841- Controlled Substances; 21 U.S.C. § 846- Conspiracy to Violate the Controlled Substances Act; and 18 U.S.C. 1956 - Money Laundering.

On April 14, 2003, Ansaldi and Gates were sentenced by Judge Seybert, Eastern District of New York. Gates was sentenced to 80 months imprisonment, 3 years of supervised release and ordered to pay a $15,000.00 fine. Ansaldi was sentenced to 72 months imprisonment and 5 years supervised release. Defendant Goetz died prior to prosecution.

Nurse Found Tampering with Demerol and Dilaudid

OCI, DEA, New York Dept. of Controlled Substances

This case was initiated based on allegations that Registered Nurse Megan Alverio criminally tampered with Emergency Room supplies of Demerol and Dilaudid at Sheehan Hospital in Buffalo, New York. It was confirmed that Alverio was using the narcotic drugs during her midnight shift and replacing the stolen drugs with saline solution.

Further investigation disclosed that after being fired from the hospital, Alverio and her husband, Eulalio Alverio, fraudulently used forged prescriptions stolen from the hospital and their Medicaid cards to purchase additional controlled drugs from Buffalo area drug stores.

On June 2, 2003, Megan Alverio appeared in Federal District Court in the Western District of New York - Buffalo and was convicted of violating Title 21 U.S.C. § 331(k) and 333(a)(2) -Felony Adulteration of Prescription Drugs. On November 4, 2003, she was sentenced to serve 3 months incarceration followed by 1 year supervised release. In addition, she was ordered to pay restitution in the amount of $1,000.00 to Sheehan Memorial Hospital.

On June 6, 2003, Eulalio Alverio was convicted of a state misdemeanor charge for possession of a controlled substance. Alverio was subsequently sentenced to a conditional discharge.

This was a joint investigation involving the FDA’s Office of Criminal Investigations, Buffalo Office, the U.S. Drug Enforcement Administration Diversion Unit – Buffalo, New York, and the New York State Department of Controlled Substances.

Pharmacy Technician Caught Stealing Viagra

This case was initiated based on an allegation that pharmacy technician Reginald B. Samples was stealing Viagra while employed at the K-Mart Pharmacy in North Fulton County, Georgia. Samples were also suspected of stealing Viagra while previously employed at the CVS Pharmacy in Marietta, Georgia.

On August 11, 2003, Samples was convicted of a felony state violation. Samples was sentenced to ten years probation and ordered to pay $12,000 restitution to CVS.

Investigation Centers on Forged Prescriptions

On April 30, 2002, the New York City Bureau of Fraud Investigation contacted the Office of Criminal Investigations, New York Field Office and requested assistance in an investigation regarding Melrose Pharmacy, 666 Courtland Avenue, Bronx, New York. The investigation involved forged prescriptions for the drug Neupogen in the names of Winston Cammock and Gregory Guinyard.

Cammock was arrested after attempting to pick up the Neupogen prescriptions from the Melrose pharmacy. During his arrest, Cammock said that he was recruited by Unique Divine who was also arrested. Guinyard was later arrested for his involvement in this scheme.

On May 14, 2003, Cammock was convicted of a misdemeanor state violation - Criminal Possession of a forged instrument and was sentenced to 1 year incarceration.

On July 23, 2003, Guinyard was convicted of a misdemeanor state violation -Criminal Possession of a Forged Instrument and was sentenced to a conditional discharge.

On March 11, 2003, Divine was convicted by jury trial of a state felony violation-Criminal Possession of a Forged Instrument and was remanded to the custody of the New York City Department of Corrections.

On August 28, 2003, Divine was sentenced to 2 ½ to 5 years incarceration.

Dinitrophenol (DNP), an Industrial Chemical, Promoted for Weight Loss

DNP Promoter Receives 60 Month Prison Sentence

OCI’s New York Field Office conducted an investigation into the Internet sale of 2, 4 Dinitrophenol (DNP), an industrial chemical as a weight loss drug by Sean Dahai Zhang. DNP had been used in the 1920’s and 1930’s for weight loss and was cited as one of the reasons for the Food and Drug Act of 1938.

Zhang was a body builder as well as a Cornell graduate with a degree in chemistry. Zhang frequented several Internet web sites and chat rooms used by body builders and referred to himself on these sites as DNP Guru and DNP 101. Because of his level of education, he represented himself within these chat rooms as an expert on the use of anabolic steroids for body building and DNP for weight loss. Zhang was aware of the hazards involved in ingesting DNP but provided guidelines for what he described as its safe use. Zhang purchased DNP in bulk, encapsulated it himself, and subsequently sold it to persons who were able to contact him via email.

A search warrant was executed at Zhang’s residence which led to his arrest. Investigators gathered evidence that showed his encapsulation of DNP was neither accurate nor sanitary as he had claimed.

Zhang’s sales of DNP resulted in the known death of a 22-year old man and the critical hospitalization of another.

On June 26, 2003, Zhang was convicted of violating 18 U.S.C. § 1341- Mail Fraud.

On June 27, 2003, Zhang was sentenced to 60 months incarceration, and 3 years probation. During the sentencing hearing, the government filed a motion for an upward departure from the sentencing guidelines. The upward departure was recommended due to the serious injuries suffered by the victims and because Zhang continued to advocate the use of DNP on the Internet under the name Dr. Evil after his arrest and conviction.

OCI and DEA Investigate Promotion of Pseudo Ephedrine

OCI’s New York Field Office initiated this investigation based on information received from the Drug Enforcement Administration (DEA), Newark Field Division. DEA was investigating the misbranding of bulk drums of pseudo ephedrine by Schwezierhall Inc. in violation of 21 U. S. C. § 846, 21 U. S. C. § 841(g) (1); and 21 U. S. C. § 331(a) conspiracy to wrongfully distribute misbranded chemicals.
Schweizerhall, Inc., an international chemical company located in Newark, New Jersey, had ordered the labels on drums of pseudo ephedrine to be stripped prior to their shipment to chemical companies in California, in an attempt to hide their contents. This investigation led to other sales of bulk pseudo ephedrine, which were intended to be diverted to be used in the manufacture of methamphetamine.

DEA subsequently designated this investigation an Organized Crime Drug Enforcement Task Force (OCDEFT) case, and it encompassed the sale of thousands of pounds of pseudo ephedrine diverted to the manufacture of methamphetamine across the United States.

On April 24, 2001, Schweizerhall, Inc. surrendered all licenses to DEA and ceased operations in the United States.

On January 16, 2002, Neil Laboratories, a pharmaceutical supply company in East Windsor, New Jersey, was identified as a conspirator in the scheme. DEA seized Neil Laboratories and the seizure was upheld on appeal in Federal Court.

On December 18, 2001, Mohamed Alattar was sentenced to serve 72 months incarceration. Alattar was convicted of violating 21 U.S.C. 841(a)(1) and 846 - Conspiracy to Manufacture and Distribute a Controlled Dangerous Substance.

On June 16, 2002, Ahmad Jaohar was sentenced to 72 months incarceration and 60 months probation. Jaohar was convicted of violating 21 U.S.C. 841(a)(1) and 846 - Conspiracy to Manufacture and Distribute a Controlled Dangerous Substance.

On November 30, 2001, Barbara Luczak was sentenced to 36 months probation and 6 months house arrest. Luczak was convicted of violating 21 U.S.C. § 841(g)(1) and 846- Conspiracy to Distribute Pseudo ephedrine.

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