Thursday, December 11, 2014

Drug Compounding Owner Sells Real Estate to Wife at Bargain Price

By Walter F. Roche Jr.

One of the owners of the drug compounding company blamed for a fatal fungal meningitis outbreak has sold his interest in two properties assessed at more than $2.5 million for a fraction of their apparent value.
Registry of Deeds records in two Massachusetts counties show Gregory A. Conigliaro sold his interest in both properties for a total of $380,000 to his wife Cynthia. Both sales were recorded on Nov. 7 of this year.
The sales come at a critical time as a $135 million bankruptcy settlement proposal is awaiting action by a federal judge. It also comes as a federal criminal investigation into the outbreak is continuing.
Conigliaro is one of the owners of the New England Compounding Center, the now defunct firm blamed for the 2012 outbreak which sickened 751 and killed 64 patients.
According to records in the Barnstable County Registry of Deeds, Gregory Conigliaro sold his interest in property at 155 Salten Point Road on Cape Cod to his wife for $155,000. The property is assessed for $2.1 million. They purchased it for $2.35 million on March 2, 2012.
In Worcester County, land records show Conigliaro sold his interest in property at 50 Sears Road in Southborough for $225,000. That property is assessed for $450,300, according to local tax records. The Conigliaros purchased the property for $300,000 on Feb. 1, 2010.
The sales took place after the release of a $21 million lien that had been placed on properties owned by Conigliaro and the other owners of NECC.
Paul D. Moore, the court appointed bankruptcy trustee, said in an email, "It does not appear to present an issue with respect to the settlement, the attachments or related injunctions. Under the terms of the settlement, the attachments were released and the injunctions lifted upon the funding into escrow of the cash deposits, all of which were in fact funded."
Conigliaro's lawyer could not be reached for comment.
Lawyers for victims of the outbreak said they were not aware of the property transfers but said they were now investigating the transactions.
The criminal investigation of the outbreak already has led to the indictment of NECC's chief pharmacist Glenn Chin. He is awaiting trial on a mail fraud charge.
In addition to the bankruptcy case, hundreds of civil suits have been merged before a federal judge in Boston.
The outbreak has been blamed by state and federal regulators on thousands of fungus tainted vials of methylprednisolone acetate that were shipped from NECC to health care providers across the country. Most of the victims were injected in the spine with the drugs and were stricken with fungal meningitis.
According to court filings Gregory Conigliaro owned 10 percent of NECC's stock with the balance owned by other members of his family and in-laws. Under the bankruptcy settlement plan, Gregory Conigliaro contributed $2.75 million to the $135 million total.

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