State Regulators Moved on NECC as Outbreak Loomed

By Walter F. Roche Jr.

Boston-Regulators in at least three states were closing in on a little known Massachusetts drug compounding firm in 2011 and 2012 even as that company was gearing up production to send out thousands of vials of a spinal steroid that turned out to be deadly.
The steroids, laced with deadly fungi and shipped from the New England Compounding Center, ultimately sickened nearly 800 patients killing 76 of them in an outbreak of fungal meningitis that became public in the Fall of 2012.
In U.S. District Court Friday regulators from Oregon, Colorado and Missouri described how they had uncovered evidence in 2011, a year before the outbreak, that the New England Compounding Center was shipping drugs to health providers in their individual states in violation of laws and regulations. The regulators disclosures came in the trial of six former NECC employees charged with racketeering, conspiracy and mail fraud.
In testimony clearly targeted at former NECC vice president and part owner Gregory Conigliaro, two of the witnesses detailed dealings with Conigliaro. A former Colorado Pharmacy Board employee said Conigliaro got angry and yelled at her in one telephone conversation.
Conigliaro is charged with conspiring to defraud the U.S. Food and Drug Administration by insisting the company was only subject to state and not federal regulation.
Wendy Anderson, the former Colorado board employee, said Conigliaro was calling from his car in 2011 questioning her about the board's charge that NECC had shipped drugs to the state without individual patient specific prescriptions.
She said an agency investigator had become suspicious when she found records at a local hospital indicating NECC had shipped 46 doses to the facility for a single patient.
Anderson said that in the 2011 phone call Conigliaro insisted that what NECC was doing was legal.
"He was yelling at me," Anderson said under questioning by Assistant U.S. Attorney George Varghese.
Asked if Conigliaro was "angry and upset," Anderson said yes.
Dan Rabinovitz, Conigliaro's lawyer, challenged her assertion that Conigliaro yelled at her, suggesting that he was merely trying to make himself heard since he was driving at the time.
Also testifying Friday was Michele Cale, a former official of the Oregon Pharmacy Board, who said NECC's license in that state was ultimately revoked.
She said Conigliaro at first insisted NECC had individual contractual agreements with health providers that, in effect, exempted them from the individual prescription requirement
Cale said she later concluded NECC officials were lying to her about the agreements. While NECC promised to provide copies of the agreements, the company ultimately sent agreements that didn't go into effect until after she had requested them. Then, she said, they asserted there were "verbal agreements" preceeding the written ones.
She said she was stunned when she finally saw the pages and pages of prescriptions NECC had delivered to Oregon customers over a three year period.
Evoking laughter several times during her testimony, Cale said simply,"They are prescriptions not post-criptions."
Cale said she concluded the responses she was getting from NECC were just "lawyer-talk."
Kimberly Grinston, executive director of the Missouri Pharmacy Board, also testified Friday that NECC was shipping drugs into her state without patient specific prescriptions.
There was no agreement that NECC could ship prescription drugs into the state without specific prescriptions, she said in response to questions from Varghese.