DOJ Indicts Four Former Serono Executives on Charges of Bribing Doctors To Prescribe AIDS Wasting Drug
The Department of Justice on Thursday indicted four former executives of the Swiss biotechnology company Serono on charges of bribing doctors to write prescriptions for the company's AIDS wasting drug Serostim, the Boston Globe reports (Kerber, Boston Globe, 4/15). Serostim, which is a growth hormone, is prescribed to HIV-positive patients to treat AIDS-related wasting. Many AIDS patients receive the drug through state-federal Medicaid programs that include the medication in their drug formularies. In 2001, the U.S. attorney's office in Boston subpoenaed from Serono nearly 10 years' worth of documents pertaining to Serostim as part of an ongoing grand jury investigation into the company's practices. The company in 2002 received similar requests from authorities in California, Florida, Maryland and New York. The criminal and civil investigations are focused on whether the company violated federal and state false claims acts or antikickback laws, which prohibit drug companies from offering incentives to doctors to prescribe a drug covered by the government. Former New York Regional Sales Manager Adam Stupak in December 2004 pleaded guilty to bribing doctors in New York City to write Serostim prescriptions (Kaiser Daily HIV/AIDS Report, 12/23/04).
Former Marketing Vice President John Bruens of San Diego, Calif.; former Vice President for Sales Mary Stewart of North Andover, Mass.; and former regional sales directors Melissa Vaughn of Colorado and Marc Sirockman of New Jersey were charged with bribery and conspiracy charges, according to the indictment, the Globe reports (Boston Globe, 4/15). Each count against the former executives -- all of whom left the company between 1999 and 2000 -- carries a maximum sentence of five years in prison and a $250,000 fine. The indictment alleges that the two former vice presidents directed the former sales directors to promise doctors in Florida and New Jersey free trips to the 3rd International Conference on Nutrition and HIV Infection in Cannes, France, in April 1999 in return for writing up to 30 prescriptions for Serostim, the AP/Long Island Newsday reports (AP/Long Island Newsday, 4/14). Each prescription was to be for a 12-week supply of the drug, and the prescriptions were valued at about $630,000 in total (Zimmerman, Wall Street Journal, 4/14). An arraignment date has not been set, according to the AP/Newsday (AP/Long Island Newsday, 4/14).