| Globe Staff
December 01, 2012
A federal grand jury in Boston has begun investigating the Framingham
compounding pharmacy that made the tainted steroid injections blamed for at
least three dozen deaths in seven states, according to several people familiar
with the matter, including one who has been called to testify.
The grand jury has begun issuing subpoenas to people who worked at New
England Compounding Center and at least one related company, Medical Sales
Management of Framingham, which handled sales and administrative support for the
pharmacy, the people said. The grand jury is expected to hear from at least some
witnesses in federal court in Boston next week.
The development is the latest sign that federal prosecutors are pursuing
potential criminal charges against the companies or people deemed responsible
for the outbreak. Criminal investigators from the Food and Drug Administration
searched New England Compounding’s offices in October, carting away boxes of
documents and other evidence.
“A grand jury has to be convened for a good reason, and usually that means
the prosecution is investigating possible crimes or wrongdoing,” said Brad
Bailey, a prominent criminal defense lawyer and former prosecutor. “Presumably,
the government has some targets in mind.”But Bailey, a lawyer at the Boston law firm Denner Pellegrino, cautioned that
the investigation is probably in the early stages of gathering information and
evidence, so it may be some time before any indictments are issued, if at
all.
One former salesman for Medical Sales Management said he was interviewed by
agents from the Federal Bureau of Investigation for an hour on Friday about the
sales and production practices at the companies, including allegations that New
England Compounding sold drugs without prescriptions in violation of its
pharmacy license.
The worker said that the agents delivered a subpoena for him to testify
before a grand jury in federal court in Boston on Wednesday morning and that he
understands others have received subpoenas. Another former Medical Sales
Management employee said former colleagues had told him they have been called to
testify Wednesday as well. Both former workers asked not to be identified to
protect their careers.
A third person familiar with the situation confirmed that former workers of
the companies have begun receiving subpoenas. This person, who was not
authorized to talk publicly about the investigation, and the other sources said
the companies are arranging lawyers to represent current and former workers
called to testify.
The US attorney’s office and the FBI declined to comment on the grand jury
proceedings, which are typically held in secret. New England Compounding’s
lawyer, Paul Cirel, could not be reached Friday, but he has previously said it
was premature, if not irresponsible, to speculate on the possibility of criminal
charges.
So far, 36 people have died and more than 500 people have developed fungal
meningitis or other serious infections after receiving steroid shots made by New
England Compounding in their backs or joints, according to the Centers for
Disease Control and Prevention.
State and federal inspectors have found fungal contamination in numerous
vials of the steroid methylprednisolone acetate, and evidence that the company
performed insufficient testing before shipping the drugs to clinics and
hospitals. Regulators have also accused the company of shipping drugs in bulk
without individual prescriptions for each patient — acting more like a
manufacturer than a pharmacy — in violation of its state license.
The company has a long history of complaints dating back to 1999, just a year
after it was founded. And the Globe reported in October that New England
Compounding had recently sent customers a “Quality Assurance Report Card”
bragging about the cleanliness of its labs, even while its internal tests —
later obtained and made public by the FDA — suggested the opposite.
Prosecutors are expected to focus on three potential charges: fraud; selling
tainted drugs in violation of the federal Food, Drug, and Cosmetic Act; or
defrauding Medicare or Medicaid. Those crimes potentially carry maximum charges
of three to 20 years in prison.
Companies charged with these crimes often settle with the government,
agreeing to pay monetary penalties to avoid a possible conviction. But defense
lawyers have said given the large number of deaths in this case, prosecutors
might seek prison sentences for any executives who are convicted.
The outbreak and government investigations have essentially become a death
sentence for New England Compounding. It has shut down its operations, recalled
its drugs, surrendered its Massachusetts license, laid off most of its
employees, and is facing dozens of lawsuits. A related company with shared
owners, Ameridose in Westborough, has temporarily agreed to suspend its
operations until the end of the year. And two New England Compounding
pharmacists, Barry Cadden and Glenn Chin, have agreed to stop practicing
temporarily.
Cadden, the company’s main pharmacist and cofounder, was summoned last month
to appear before Congress, but declined to answer questions, citing his Fifth
Amendment right to avoid incriminating himself. Cadden’s lawyer declined to say
Friday whether Cadden has been asked to testify before the grand jury.
Source is the Boston Globe found
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