Pharmacy Charged with Defrauding United States Over Distribution of Under and Over Potent Drugs
By the C|C Whistleblower Lawyer Team
The owner and director of compliance of an Indiana compounding pharmacy were charged criminally in connection with their distribution of over- and under-potent drugs, and defrauding the United States by interfering with and obstructing the lawful functions of the FDA.
Paul J. Elmer, 64, of Fishers, Indiana, and Caprice R. Bearden, 62, of Carmel, Indiana, were charged in a 10-count indictment with one count of conspiracy to defraud the United States, three counts of distributing an adulterated drug in interstate commerce and six counts of adulterating drugs while held for sale after shipment of a drug component in interstate commerce.
Elmer owned and was the President of Pharmakon Pharmaceuticals Inc., and Bearden was the company’s Director of Compliance. The indictment alleges that from July 2013 through mid-February 2016, Bearden received approximately 70 potency test failure notices from companies used by Pharmakon to test for potency, indicating that drugs such as morphine sulfate and fentanyl were either under- or over-potent. According to the indictment, Bearden discussed the out-of-specification test results with Elmer, a licensed pharmacist, and until Pharmakon compounded over potent morphine sulfate in February 2016, Elmer determined that Pharmakon should not contact any individuals or entities – including hospitals – who received the drugs, nor conduct any product recalls before FDA intervention.
On several occasions, according to the indictment, infants were injected with drugs compounded by Pharmakon – that were significantly over-potent. For example, the indictment alleges that in early February 2016, Pharmakon distributed over potent morphine sulfate, an opioid typically used for relief of moderate to severe acute and chronic pain, to a hospital in Indiana and a hospital in Illinois. As alleged in the indictment, three infants at the hospital in Indiana received the morphine sulfate which was nearly 25 times the strength indicated on its label, and one infant was taken by emergency helicopter to a nearby children’s hospital.
Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division stressed that “the distribution of over- and under-potent drug products poses a serious risk of harm to patients. FDA’s efforts to ensure the safety of compounded drugs is critically important. Impeding FDA’s ability to do its job and uncover these types of safety concerns will not be tolerated.” U.S. Attorney Josh Minkler for the Southern District of Indiana added, “these defendants put greed and the reputation of their company ahead of the health and safety of our most innocent victims. Their actions put lives in danger and they will be held accountable.”
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