Two Criminals Doing Business Together

The FDA and the Health and Human Services agencies have acquired a much needed short fuse in dealing with criminals disguised as pharmaceutical companies.

(MYRTLE BEACH, S.C.) - US District Judge Denny Chin on Bernie Madoff's conviction:

Wonder what US District Judge Denny Chin would call KV Pharmaceuticals and Purdue Pharma -- responsible for defrauding consumers -- endangering their lives -- and in some cases causing scores of deaths.

My friend at Pharmalot, Ed Silverman posted an article today on his website regarding KV Pharmaceuticals and tagged it as ‘if something can go wrong, it will" in KV Pharmaceutical's world. Last year the FDA charged them with making and selling adulterated and unapproved drugs (see here). KV Pharmaceuticals has a cash flow problem right now as well as a dwindling workforce due to layoffs. Kind of doom and gloom for KV Pharmaceuticals. David Hermelin, formerly a Vice President of Corporate Strategy and Operations filed a charge of "religious discrimination" against KV Pharmaceuticals last year. Of course, KV denies the charges against them lodged by Hermelin.

Pharmalot wrote that Hermelin is the son of Marc Hermelin, KV’s former chairman and CEO, who was dismissed in December 2008 amid a probe into alleged mismanagement, The St. Louis Business Journal writes. However, Marc Hermelin claims he retired from his position prior to his termination by the board. At stake in the dispute is $10.8 million in accrued retirement benefits. Both David Hermelin and Marc Hermelin are still members of KV’s board, because they hold 62 percent of the voting power of two classes of common stock.

And last month, a wholly owned subsidiary known as Ethex pleaded guilty to two felony counts of criminal fraud for failing to report to the FDA that it was making oversized tablets that could be harmful to patients, The St. Louis Post-Dispatch notes. A KV exec considered what to do in July 2008 after KV discovered oversize tablets and one option was “to do nothing because the probability of oversized tablets is very low,” Assistant US Attorney Andrew Lay said in court papers. Over the objections of other employees, the executive chose the “do-nothing option.” The unnamed executive instructed multiple employees to “minimize written communications about KV’s oversized tablet manufacturing problems and limit distribution and discussion of any documents discussing these problems,” according to the prosecutor.

The St. Louis Post-Dispatch articles are lengthy, but quite a read -- not to mention a potential book^[1].

Reportedly there is no manufacturing going on right now at KV Pharmaceuticals and they are awaiting approval from the FDA to resume manufacturing. Investigators have said KV Pharmaceuticals and its subsidiaries manufactured and sold dozens of different medicines without federal approval and tried to conceal its problems from federal regulators.

There was a plea agreement and the company was sentenced to five years of probation and ordered to pay $27.6 million in fines and restitution. No individuals were charged criminally.

So who will a criminally convicted KV Pharmaceuticals turn to in order to recover their revenue -- never mind their reputation -- none other than the criminally convicted Purdue Pharma. KV Pharmaceuticals made a deal with Purdue Pharma -- under the court settlement -- Purdue Pharma will manufacture OxyContin extended release tablets -- and KV Pharmaceuticals will sell those painkillers.

Here's a suggestion for the convicted criminals from both pharmaceutical companies -- it appears the FDA is taking their responsibility to protect the American consumers' safety very seriously -- I wouldn't mess with the FDA any further. Hopefully the Secretary of Health and Human Services will soon see charges of debarment against individuals at KV Pharmaceuticals to prevent them from working in the pharmaceutical industry -- as was done to Purdue Pharma.

And one more piece of advice for KV Pharmaceuticals and Purdue Pharma from me -- Now may not be a good time to further irritate the FDA and the Health and Human Services agencies -- they seem to have acquired a much needed short fuse in dealing with criminals disguised as pharmaceutical companies.

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Salem-News.com Reporter Marianne Skolek, is an Activist for Victims of OxyContin throughout the United States and Canada. In July 2007, she testified against Purdue Pharma in Federal Court in Virginia at the sentencing of their three CEO's who pled guilty to charges of marketing OxyContin as less likely to be addictive or abused to physicians and patients. She also testified against Purdue Pharma at a Judiciary Hearing of the U.S. Senate in July 2007. Marianne works with government agencies and private attorneys in having a voice for her daughter Jill, who died in 2002 after being prescribed OxyContin, as well as the voice for scores of victims of OxyContin. She has been involved in her work for the past 7-1/2 years and is currently working on a book that exposes Purdue Pharma for their continued criminal marketing of OxyContin.

Marianne is a nurse having graduated in 1991 as president of her graduating class. She also has a Paralegal certification. Marianne served on a Community Service Board for the Courier News, a Gannet newspaper in NJ writing articles predominantly regarding AIDS patients and their emotional issues. She was awarded a Community Service Award in 1993 by the Hunterdon County, NJ HIV/AIDS Task Force in recognition of and appreciation for the donated time, energy and love in facilitating a Support Group for persons with HIV/AIDS.