Justia Drugs & Biotech Opinion Summaries

Volkman, an M.D. and a Ph.D. in pharmacology from University of Chicago, was board-certified in emergency medicine and a “diplomat” of the American Academy of Pain Management. Following lawsuits, he had no malpractice insurance and no job. Hired by Tri-State, a cash-only clinic with 18-20 patients per day, he was paid $5,000 to $5,500 per week. After a few months, pharmacies refused to fill his prescriptions, citing improper dosing. Volkman opened a dispensary in the clinic. The Ohio Board of Pharmacy issued a license, although a Glock was found in the safe where the drugs were stored. Follow-up inspections disclosed poorly maintained dispensary logs; that no licensed physician or pharmacist oversaw the actual dispensing process; and lax security of the drug safe. Patients returned unmarked and intermixed medication. The dispensary did a heavy business in oxycodone. A federal investigation revealed a chaotic environment. Cup filled with urine were scattered on the floor. The clinic lacked essential equipment. Pills were strewn throughout the premises. Months later, the owners fired Volkman, so he opened his own shop. Twelve of Volkman’s patients died. Volkman and the Tri-State owners were charged with conspiring to unlawfully distribute a controlled substance, 21 U.S.C. 841(a)(1); maintaining a drug-involved premises, 21 U.S.C. 856(a)(1); unlawful distribution of a controlled substance leading to death, 21 U.S.C. 841(a)(1) and 841(b)(1)(C), and possession of a firearm in furtherance of a drug-trafficking crime, 18 U.S.C. 24(c)(1) and (2). The owners accepted plea agreements and testified against Volkman, leading to his conviction on most counts, and a sentence of four consecutive terms of life imprisonment. The Sixth Circuit affirmed. View "United States v. Volkman" on Justia Law

A chiropractor pleaded guilty to defrauding health insurers and to money laundering and was sentenced to 70 months (the bottom of the guidelines range) and to pay restitution of almost $2 million. At the guilty-plea hearing the judge asked the defendant whether he was “currently under the influence of any drugs, medicine, or alcohol,” and the defendant answered: “prescription medications.” He told the judge that he was taking medicines for “high anxiety, depression, adult attention hyperactivity disorder, and depression,” but stated that he was “thinking clearly.” He waived his right to appeal, but six weeks later moved to retract the plea, claiming that he had been taking psychotropic drugs, rendering his plea involuntary. The judge denied the motion because the defendant had presented no evidence that switching from Prozac to Lexapro could have the dramatic effects he claimed it had, and because at the plea hearing he had been alert and responsive and exhibited no signs of confusion. The Seventh Circuit affirmed.View "Unted States v. Hardimon" on Justia Law

Borrome, a citizen of the Dominican Republic, and, since 1996 a lawful permanent resident of the U.S. pled guilty in 2002 to violations of the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. 301-399d, prohibitions on unlicensed wholesale distribution of prescription “drugs” in interstate commerce. He was sentenced him to four months’ imprisonment followed by four months’ home confinement. In 2010 he was served with a notice of removal and the IJ reasoned that because Borrome’s offense involved unauthorized distribution of a Schedule II controlled substance (Oxycontin ), it is an aggravated felony under 8 U.S.C. 1101(a)(43)(B) pursuant to the “hypothetical federal felony test,” so that Borrome was removable under 8 U.S.C. 1227(a)(2)(B)(i) as an alien convicted of violating any law “relating to a controlled substance.” The Board of Immigration Appeals affirmed. Borrome has been removed from the United States. The Seventh Circuit reversed, concluding that violation of the FDCA wholesale distribution provisions does not constitute an aggravated felony and that those laws are not laws relating to a controlled substance. View "Borrome v. Att'y Gen. of the U.S." on Justia Law

Defendants, two of three lawyers who represented several hundred Kentucky clients in a mass-tort action against the manufacturer of the defective diet drug "fen-phen," settled the case for $200 million, which entitled them under their retainer agreements to approximately $22 million each in attorney fees. By visiting clients and obtaining their signatures on "confidential settlements," for lesser amounts, the two actually disbursed slightly more than $45 million, less than 23 percent of the total settlement. The lawyers kept the remainder for themselves and associated counsel, transferring much of it from the escrow account to various other accounts, including out-of-state accounts. The scheme was discovered; the lawyers were disbarred and convicted of conspiracy to commit wire fraud, 18 U.S.C. 1343, 1349. One was sentenced to 240 months, the other to 300 months. They were ordered to pay more than $127 million in restitution. The Sixth Circuit affirmed, rejecting a variety of challenges to the sufficiency of the evidence and trial procedures. View "United States v. Cunningham" on Justia Law

Based on his role in operating an online pharmacy that did not require prescriptions, defendant was convicted of conspiracy to import controlled substances, 21 U.S.C. 963 and 18 U.S.C. 2, conspiracy to possess controlled substances with the intent to distribute 21 U.S.C. 846 and 18 U.S.C. 2, and conspiracy to launder money, 18 U.S.C. 2; 1956-1957 with intent to promote the importation of controlled substances. The Seventh Circuit affirmed, upholding admission of expert testimony by a pharmacologist who testified about the classification of various drugs, their side effects, and the medical supervision needed to prescribe them. Although the testimony had only minimal relevance, the threshold for relevance under Rule 401 is quite low. Parts of the testimony related to side effects and birth defects should have been excluded under Rule 403 because the probative value was negligible, but the error was harmless given the weight of the evidence. View "United States v. Boro" on Justia Law

Defendants, who operated what purported to be online pharmacies, were convicted on a 42-count indictment alleging crimes arising from a multi-national, internet-based, controlled-substance-distribution scheme. They have appealed multiple decisions of the trial court and appealed their conviction. The Third Circuit affirmed. Among other challenges, the court rejected arguments: that the money-laundering convictions impermissibly merge with underlying predicate felonies; that the district court should have suppressed evidence from untimely-sealed surveillance records; that the indictment, evidence, and jury instructions were insufficient to sustain a Continuing Criminal Enterprise conviction; and that the court erred in calculating sentences; the the alleged conduct, distribution of controlled substances via the internet, was not illegal at the time charged; that the money laundered was obtained by lawful means; and that certain convictions were misdemeanors, not felonies. View "United States v. Mullinix" on Justia Law

Defendant was the pharmacy director of a medical center and had influence over decisions concerning which drugs to stock. Levato was the local business manager of a pharmaceutical company. Levato agreed to pay defendant $18,000 not to switch away from his company's drug, and made computer entries recording nine nonexistent speeches given by defendant for the pharmaceutical company; defendant later received another $14,000 for more fictitious speeches. After investigation by an FDA agent, Levato and defendant were indicted. Levato plead guilty and testified against defendant. Defendant was convicted of solicitation and receipt of kickbacks and sentenced to 22 months in prison. The Seventh Circuit affirmed. Memoranda prepared by the Department of Health and Human Services, discovered by the prosecution after trial, did not constitute exculpatory material withheld by the prosecution. The court noted that the documents would have strengthened the prosecution case. View "United States v. Muoghalu" on Justia Law

Defendant was found guilty of two federal offenses: one count of aiding and abetting a violation of the so-called Medicare anti-kickback statute, in violation of 42 U.S.C. 1320a-7b(b)(2) and 18 U.S.C. 2, and one count of aiding and abetting the falsification of a document, in violation of 18 U.S.C. 1519 and 2. Defendant raised several claims on appeal. The court held that the district court did not err in admitting testimony concerning statements made by defendant's wife during her interview with the FBI; in admitting evidence under Federal Rule of Evidence 404(b) that defendant stole funds from previous employers in the healthcare industry; in denying defendant's motion to dismiss count one of the second superseding indictment, which charged a violation of the anti-kickback statute; by refusing to hold an evidentiary hearing on defendant's motion to suppress statements and to declare his proffer agreement unenforceable; and by granting in part the spouse's attorneys' motion to quash a subpoena requiring one of the representatives to produce his entire file regarding the representation of the spouse who was now deceased. The court also held that the district court's jury instructions regarding count one were not erroneous. The court held, however, that the district court erred in calculating the amount of loss under Guidelines 2B4.1 when it used the loss to the victims, rather than the benefit to defendant, as the measure of loss. Therefore, the court concluded that there was procedural error and defendant's sentence was vacated. The court finally vacated the restitution order and remanded for further proceedings. The court rejected defendant's remaining claims. View "United States v. Yielding" on Justia Law