Criminal Case Activity
OCI investigates activities related to the Federal Food, Drug, and Cosmetic Act (FD&C Act), the Federal Anti-Tampering Act, and other related acts including the U.S. (U.S.) Code Title 18. Below are examples of the different types of criminal investigations conducted by OCI.
* Indicates that the link is pulled from the FDA.gov Archive
Baylor Scott & White
Baylor, Scott, and White SurgiCare in Texas reported over eight patients that had experienced an emergency cardiac event during surgery. Physical inspection of the IV bags showed small puncture holes and laboratory analysis identified the presence of epinephrine, bupivacaine, and lidocaine.
An anesthesiologist was identified as the medical professional responsible for the tampering of the IV bags after he was informed of a disciplinary inquiry against him. He was convicted for injecting dangerous drugs into patient IV bags, leading to one death and numerous cardiac emergencies. He was sentenced to 2,280 months of imprisonment.
Endo Pharmaceuticals
After several deaths were attributed to the opioid painkiller, Opana ER, a pharmaceutical company admitted they were aware that sales representatives were making claims of purported abuse deterrence, tamper resistance and/or crush resistance when marketing Opana ER to prescribers. The company was ordered to pay $1.086 billion in criminal fines and an additional $450 million in criminal forfeiture — the second-largest set of criminal financial penalties ever levied against a pharmaceutical company —for violations of the FD&C Act related to the distribution of the opioid medication Opana ER with INTAC.
New England Compounding Center (NECC)
The owner of the New England Compounding Center was convicted of racketeering, mail fraud, and selling misbranded drugs. The drugs lead to a nationwide fungal meningitis outbreak, leaving more than 700 patients in 20 states with a fungal infection after receiving injections of a prescription injectable drug manufactured by NECC. Of those patients, 64 died. The outbreak was the largest public health crisis ever caused by a pharmaceutical product. The owner was sentenced to nine years in federal prison.
Concealment of Malfunction in Devices
A medical device company misled its customers and the FDA about a serious malfunction that affected their devices when they were used to test venous blood samples. This caused an estimated tens of thousands of children and other patients to receive inaccurately low lead test results. The company pled guilty and was ordered to pay $21.8 million fine, $10.9 million in forfeiture and a minimum of $9.3 million to compensate patient victims.
Genetech Inc. and Liveyon LLC
An individual created two companies to manufacture and distribute injectable stem cell products made from human umbilical cord blood and misrepresented the products as suitable for the treatment of a variety of conditions such as lung and heart diseases, autoimmune disorders, Alzheimer’s disease, and Parkinson’s disease. He was sentenced to 36 months imprisonment, 12 months of supervised release, and a $100 fine for introducing an unapproved new drug into interstate commerce.
COVID-19 Health Fraud
There were complaints from individuals who had consulted with a naturopathic doctor who was selling homeoprophylaxis immunization kits also known as Oligotherapy Kits. The kits reportedly contained a minute amount of COVID-19 virus and were intended to create an antibody response in the immune system, one complainant even received lower dosages for her children, ages ten and seven years old. Included in the kits were Centers for Disease Control and Prevention (CDC) vaccination cards filled out with the provider's name and fraudulent Moderna COVID-19 vaccine lot numbers and directions on how to correctly fill out the CDC vaccination cards.
The naturopathic doctor was sentenced to 30 months imprisonment and fined $74,483 for wire fraud and false statements related to health care.
Products Testing Company Defrauded Consumers for Decades
For decades the owner and executive director of a consumer products testing company was defrauding customers by reporting laboratory test results for panelist testing that was not fully performed. Consumers were defrauded of more than $46 million by testing products on materially lower numbers of panelists than the numbers specified and paid for by the company’s customers. The owner was sentenced to 60 months of prison, a supervised release term of three years, restitution in approximately of $1.4 million, and forfeiture of $46.2 million.
Pain Cream Prescriptions Fraud
Independent drug representatives recruited customers to obtain their personal identification and health insurance information and caused numerous forged prescriptions for ointments and topical creams to be sent to compounding pharmacies. The prescriptions were filled and billed to health insurance companies in excess of $300,000. Seven individuals were convicted for conspiracy, wire fraud, mail fraud, money laundering, and health care fraud. The sentences varied for each person, however, the largest sentence in length was 13 years of prison for one of the individuals.
Toxic Bleach Sold to Treat COVID-19
A father and his sons were manufacturing, promoting, and selling a chemical solution containing sodium chlorite and water which, when ingested orally, became chlorine dioxide, a powerful bleach typically used for industrial water treatment or bleaching textiles, pulp, and paper. However, the FDA had not approved the product as a drug, including to treat COVID-19. Two of the men were sentenced to 151 months in prison and the remaining two men were sentenced to 60 months in prison.
Vulto Creamery Cheese
There was a cluster of Listeria monocytogenes cases which had resulted in six hospitalizations and two deaths in four states. The owner of the company pled guilty admitting he oversaw sanitation and environmental operations at the facility. The owner was sentenced to three years of probation and ordered to pay a fine of $100,000 and perform 240 hours of community service.
Family Dollar
Over the last few years, several inspections were completed at a local store and documented troubling rodent infestation at the facility. The rodent activity manifested into complaints involving live and dead rodents, or products with rodent activity observed, being delivered from the distribution center to various stores in at least five states.
The company agreed to pay $41.475 million in forfeiture and was fined an additional $200,000.
Peanut Corporation of America
Two former officials of the Peanut Corporation of America (PCA) were sentenced to prison for their roles in a conspiracy to defraud their customers by shipping salmonellapositive peanut products. They also confessed to falsifying microbiological test results. The tainted peanut butter led to an outbreak with more than 700 cases of salmonella poisoning in 46 states and nine deaths. PCA’s former president received a sentence of 28 years in prison, the largest criminal sentence ever given in a food safety case.
Jensen Farms
Two cantaloupe farm owners pled guilty to charges of shipping their cantaloupe knowing that it was contaminated by a poisonous bacteria, Listeria monocytogenes. The cantaloupes went to 28 states, resulting in at least 147 hospitalizations and 33 deaths. One woman, pregnant at the time of her outbreak-related illness, had a miscarriage. Each of the two owners were sentenced to five years’ probation and were together required to pay a total of $150,000 in restitution.
Retailer Selling Illegal Dietary Supplements
A sports and dietary supplements retailer sold unapproved products marketed as dietary supplements that contained illegal drug products. In total, eight individuals and three companies were convicted. One of the individuals was sentenced to 13 months in prison. The cofounder of the retailer was sentenced to 54 months in prison and ordered to forfeit $3 million. The company was also ordered to pay $1.2 million in forfeiture.
Groce (Livestock Drugs)
A man was illegally obtaining livestock prescription medications from two companies. The owners of the company were arrested and pled guilty to charges of mail fraud and conspiracy to defraud the U.S. Both companies paid a $5 million fine, and a forfeiture money judgment of $46.8 million.
Racehorse Doping Rings
A joint investigation between OCI and the Federal Bureau of Investigations focused on corruption within the horse racing industry. The investigation identified an individual who utilized another business to manufacture and sell misbranded and unapproved animal drugs to racehorse owners and trainers. A total of 27 individuals were charged with the shipment and administration of adulterated and misbranded drugs designed to secretly and dangerously enhance the racing performance of horses beyond their natural ability, a dishonest practice that places the lives of affected animals at risk.
One of the individuals was sentenced to 24 months’ probation and ordered to pay restitution of approximately $28.2 million.
Deli Beer Smoke Inc.
An individual was identified as selling misbranded and counterfeit tobacco products to stores. Approximately 6,123 Logic packages, 2,303 JUUL packages, and 7,388 units of misbranded drugs, were seized from the individual. The man was sentenced to one year and one day of imprisonment, three years of supervised release, approximately $1.6 million of restitution, and $431,447 of asset forfeiture for trafficking in counterfeit goods.
Capital Trade Inc.
The operator of Capital Trade Inc. (CTI), a tobacco wholesaler, transported almost $40 million worth of smokeless tobacco products from Pennsylvania to New York, while failing to pay millions of dollars in New York state excise taxes on that tobacco. The individual and his associates created false invoices and filed false documents with state regulators which substantially underreported the amount of tobacco sold. He was sentenced to one year and one day in prison, three years of supervised release, and ordered to pay over $7.8 million in restitution.
Counterfeit Newport Cigarettes
An undercover OCI special agent went overseas and met with a suspect to arrange purchase of counterfeit cigarettes. The special agent then wired more than $130,000 to an account in Dubai for the undercover purchase of 1,030 cases of counterfeit Newport cigarettes, with an estimated street value of $5.6 million. The counterfeit cigarettes were seized when they reached the United States port of entry. The suspect was sentenced to 16 months in prison.
Pediatric Hospitals Affected from Contaminated Products
A former owner and CEO of a drug manufacturing company lied to the FDA and allowed contaminated products make their way to pediatric hospitals. The former CEO stated that his company’s new water system had met the acceptance criteria while shipping over 7,000 units to its distribution list. He was sentenced to 37 months in prison.
OCI Shuts down illegal drug manufacturing operation
This investigation identified a darkweb seller of counterfeit FDA regulated products to include oxycodone tablets containing fentanyl. An extensive investigation led to the identity of the darkweb sellers and the location of their laboratory. A search warrant was executed, and agents seized a pill press machine, components to make counterfeit pills and over 1500 finished counterfeit FDA regulated drugs. Three suspects were arrested and sentence to prison for their roles in this counterfeiting operation.
Darknet Counterfeit Drug Operation Shutdown
OCI investigated and shut down a darknet operation that was pumping kilograms of counterfeit pills containing fentanyl into communities across the nation over the course of four years, using Darknet markets including AlphaBay, Dream, Wall Street, and Empire to reach a broad customer base. The defendants also used encrypted messaging services to communicate with and sell pills directly to customers. In exchange for cryptocurrency, the defendants sold counterfeit pills that were shipped via the U.S. Postal Service to buyers in all 50 states. The conspirators relied on sophisticated technology to distribute and profit from a staggering quantity of pills pressed with fentanyl. Three suspects were arrested and sentenced to prison.
Google, Inc.
OCI initiates an investigation from information supplied by a suspect in another case who used Google’s services to advertise his illegal online pharmacies. Undercover OCI agents then pose as operators of “Canadian” online pharmacies and pay Google for listing their illegal sites in Google’s AdWords platform, demonstrating that the company does not care if the products are being sold illegally. After showing Google the evidence, the company agrees to a civil settlement, acknowledging that it had helped “Canadian” online pharmacies target ads for their illegal organizations through AdWords. Google forfeits $500 million and agrees to follow a number of compliance and reporting measures to make sure similar conduct would not happen in the future.