Ex NECC Sales Chief Details Ruses

By Walter F. Roche Jr.


BOSTON- The former sale manager for a defunct drug compounding company testified in federal court today that the company used fake patient names, contracts and other ruses to convince regulators that they were operating like a regular pharmacy thus avoiding much tighter regulation by the federal government.
Robert Ronzio, who was testifying under the terms of a plea agreement with federal prosecutors, told jurors said that when a Tennessee customer started to ask too many questions about the New England Compounding Center's practices, he just walked away for fear that Tennessee regulators would catch on and bar them from selling any products in the state.
"Potentially we could lose the whole state," he said.
His testimony came in the trial of two former pharmacists, Kathy Chin and Michelle Thomas, for the drug compounding firm who are charged with violations of the federal Food Drug and Cosmetic Act.
Without individual prescriptions, Ronzio said, the company would be in violation of state and federal law.
Ronzio has entered a guilty plea to the charge that he conspired with others at NECC to defraud the U.S. Food and Drug Administration. Under questioning by Assistant U.S. Attorney Amanda Strachan, Ronzio said his agreement required him "to tell the truth." He has yet to be sentenced.
He said he went to work for NECC and a related sales company in 2010 and got a crash course in the drug company jargon from NECC's president and part-owner Barry J. Cadden. Cadden is now serving a nine year federal prison sentence following his conviction on racketeering and mail fraud charges.
"I couldn't pronounce the names of medications," he said of his first days at NECC.
He said NECC sometimes used a process dubbed back-filling to generate the required patient specific prescriptions. Customers, hospitals and clinics, would send NECC the list of prior patients to justify new orders.
With Cadden's approval, Ronzio said, some customers, depending on volume, were exempted from providing a list of patients. And some customers were given contracts that exempted them from listing patients unless NECC made a specific request.
"We were trying to show regulators we were acting like a pharmacy," Ronzio said.
Under cross examination Ronzio acknowledged that he had no direct dealings with the defendants.
He said he saw Thomas only once or twice during her short stint at NECC.
Also testifying for the prosecution were two other former NECC employees, Linda Carvalho and Leliz (cq) Cedrone. Carvalho said she knew from past experience that patient specific prescriptions were required and that all prescriptions needed to be verified by a licensed pharmacist before they could be issued.
Nonetheless she said that later in her time at NECC there were a lot of orders that didn't have names.
"Barry gave instructions to ship without names," she said. "We knew they were fake," she said in describing some of the patient lists provided by customers.
Carvalho acknowledged she never worked with Kathy Chin.
Cedrone said some orders would come in with the name of a prescribing physician listed as the patient. She said there were concerns about the obviously fake names and in some cases she would ask company sales staffers to go back to the customer and request "appropriate names."
Kathy Chin and Thomas were the ones to give prescriptions a final check before they were shipped out, she testified. She said that on occasion Thomas had expressed concerns about the way NECC operated but no changes resulted.
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Phony Prescriptions Detailed in Trial

By Walter F. Roche Jr.

Boston-A criminal investigator detailed dozens of fake prescriptions seized at a now defunct drug compounding company when an investigation was opened into the cause of a fungal meningitis outbreak that eventually led to the death of more than 100 patients.
Testifying in U.S. District Court Michael Mangiacotti of the U.S. Food and Drug Administration said the phony prescriptions seized included patient names including L.L. Bean, Filet O Fish, Cocoa Puff and Harry Potter.
He told jurors that the records showed the prescriptions were verified by Kathy Chin and Michelle Thomas, two licensed pharmacists then employed by the New England Compounding Center, the company ultimately blamed for the outbreak.
The two are on trial on charges that they violated the federal Food Drug and Cosmetic Act (FDCA) by effectively issuing the prescriptions for fictitious patients.
Lawyers for the two defendants countered by arguing that other NECC employees, not Chin or Thomas were responsible for verifying the patient names and their clients merely verified the type of drug ordered and the health facility that placed the order.
The trial is the fourth and final one to result from a 2014 indictment that named 14 defendants, two of who are already serving terms in federal prison. One of those already jailed in Glenn Chin, Kathy Chin's husband, but that information was not provided to jurors
The charges against Chin and Thomas do not involve the drug, methylprednisolone acetate, which caused the outbreak but other drugs shipped to health facilities in Nebraska and Indiana.
Under questioning by Assistant U.S. Attorney Christopher Looney, Mangiacotti said he was one of many federal investigators called in to investigate NECC as the outbreak worsened in the Fall of 2012.
He said the records seized from NECC's Framingham, Mass. facility included dozens of order forms that had been faxed from health facilities across the country.
Focusing on orders verified by Thomas and Chin, he read the names of the purported patients including Bradd Pitt, Flash Gordon and Johnny Cash.
Under Looney's questioning Mangiacotti said the records showed Thomas and Chin were listed as the verifying pharmacist for the orders. Specifically the two are charged with a total of six violations of the FDCA.
Mangiacotti said other records seized from NECC included the personnel files for Chin and Thomas. Thomas had only joined the company in March of 2012 and departed in August before the outbreak became public. Chin had joined NECC in 2010 but had left for two maternity leaves by the time the outbreak became public in late September of 2012.
Joan Griffin, Chin's lawyer, in cross examination of Mangiacotti, challenged why he had not also investigated the health facilities that ordered the drugs from NECC and submitted orders with patently false patient names. The FDA investigator said he did not know whether other investigators had investigated the health facilities.
Griffin and Michael Bourbeau, Thomas' lawyer, also charged in opening statements that it was Barry Cadden, the now jailed NECC president and part owner, who was responsible for the prescriptions being processed with fake names.
Cadden was convicted of racketeering and mail fraud, but that information like Glenn Chin's conviction was not conveyed to the 14 jurors hearing the case. Chin is serving an eight year sentence while Cadden got a nine year sentence.
Bourbeau, in his presentation and questioning noted that his client only worked for NECC for a short period of time and was gone even before the outbreak became public.
In questioning Mangiacotti, Bourbeau asked about an interview the agent held with his client in which she did raise questions about questionable practices at NECC.
Mangiacotti acknowledged that he had heard that Thomas had some concerns and that was why he interviewed her. But, he said, she made no mention of fake patient names.
He also cited an email exchange in which another NECC employee, not his client, gave the final go-ahead to ship a questionable prescription.
The two defense attorneys argued that it was the health facilities and their officials who balked at giving real patient names due to a federal law and privacy concerns.

NECC Indictment Scorecard

Here are the names of those indicted in the probe of the New England Compounding Center and the current status of their cases.

Barry J. Cadden: convicted of racketeering, racketeering conspiracy, mail fraud and violations of the Food Drug and Cosmetic Act (FDC Act). (Cleared of second degree murder)Currently serving nine year federal prison sentence. Release date June 6, 2025.
Glenn Chin: found guilty of racketeering, racketeering conspiracy, mail fraud and violations of the FDCA. (Cleared of second degree murder) Serving an eight year federal prison sentence. Release date Feb. 26, 2025.
Gene Svirskiy: Convicted of racketeering, racketeering conspiracy, violations of the FDCA. Awaiting sentencing.
Scott M. Connolly: entered guilty plea to nine counts of mail fraud. Awaiting sentencing.
Sharon P. Carter: convicted of conspiracy to defraud the federal government. Awaiting sentencing.
Alla V. Stepanets: convicted of violation of the FDCA. Sentencing today.
Gregory A. Conigliaro: convicted of conspiracy to defraud the U.S. Food and Drug Administration. Awaiting sentencing
Robert A. Ronzio: entered guilty plea to conspiracy to defraud the FDA. Awaiting sentencing
Christopher Leary: convicted of mail fraud and violations of the FDCA.
Kathy S. Chin: Convicted of four violations of the FDCA with intent to defraud. Sentencing August 8.
Michelle L. Thomas: Convicted of two violations of the FDCA with intent to defraud. Sentencing in August 9.
Carla R. Conigliaro: Pleaded guilty to violations of financial transaction reporting laws. Sentenced to probation
Douglas A. Conigliaro Pleaded guilty to violations of financial transaction reporting laws. Sentenced to probation.
Joseph M. Evanosky: cleared of all charges.

Two Face Charges in 4th/Final NECC Trial

By Walter F. Roche Jr.

Some seven years after an obscure Massachusetts drug compounding firm began shipping thousands of vials of a contaminated drug to health facilities across the country, two former employees of that firm are about to go on trial on charges stemming from a two-year probe of their former employer.
Jury selection and opening arguments are scheduled for Monday in U.S. District Court in Boston in the trial of the two pharmacists once employed by the long defunct New England Compounding Center. Kathy Chin and Michelle Thomas are charged with violations of the Food Drug and Cosmetic Act.
They are the last of 14 defendants to face trial following a December 2014 indictment by the grand jury convened in the wake of a deadly fungal meningitis outbreak. Several of the original defendants have entered guilty pleas and await sentencing. Two already are serving federal prison terms following their conviction on racketeering, conspiracy and mail fraud charges. One of those is Glenn Chin, the husband of Kathy Chin.
Kathy Chin's lawyer has asked U.S District Judge Richard G. Stearns to bar any mention in the upcoming trial of her relation to her convicted husband.
That filing is but one of nearly a dozen filed in behalf of Chin and Thomas seeking to limit testimony and evidence in a trial that is expected to last some two weeks, far less than the three prior marathon sessions.
In a 14-page response today federal prosecutors asked Stearns to deny all the defense motions calling them "a hodgepodge of incorrect statements of law," based on "mistaken assumptions."
"There is no basis to exclude any of the evidence challenged by the defendants," the prosecutors stated.
Many of defendants motions center on the fact that Chin and Thomas are not charged with playing any role in the production of the drugs that ultimately led to the deaths of over 100 patients.
Instead the two, both Massachusetts licensed pharmacists, were assigned to check hundreds of drug orders being sent out to NECC's customers against the orders placed with NECC.
Prosecutors argue that the two played the role of "verifying pharmacists," charged with verifying the accuracy of the orders before shipment. Furthermore, prosecutors argue, "dispensing drugs without valid prescriptions was an intentional business practice at NECC."
Prosecutors dispute the contention that mentioning the relationship between Glenn and Kathy Chin will prejudice or inflame jurors and, they say, jurors must hear about the clearly fictitious names on the orders being shipped from NECC..
In three prior trials prosecutors have repeatedly pointed out that dozens of patient names on the drug orders were patently false. They included Disney characters, Donald Trump, Filet O' Fish, to name a few.
Prosecutors in their pretrial filings have indicated they intend to call as witnesses officials of the U.S. Food and Drug Administration and the Massachusetts Board of Pharmacy. Also on the list are former NECC employees including Robert Ronzio, a former NECC sales chief, and Scott Connolly, an unlicensed pharmacy technician, both of who have entered guilty pleas and await sentencing.
Lawyers for the two defendants have argued that their clients were "low level employees" and not assigned to check the validity of patient names.
In fact they have asked the judge to bar the use of adjectives "fake" or "fictitious" in reference to patient names.
The prosecution filing, however, concludes that the six drug shipments on which the charges against the two are based "were not accidents or mistakes," but an intentional unlawful practice.
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NECC Defendants Seek Evidence Limits

By Walter F. Roche Jr.

The two remaining defendants in the criminal case stemming from a deadly 2012 fungal meningitis outbreak says prosecutors should be forced to prove questionable names on prescription drug orders like Mary Lamb and Ginger Rogers really were fake and not the names of actual patients.
In a slew of filings before an upcoming trial, the two former employees of a defunct drug compounding company, said government prosecutors have simply asserted the names were fake without providing any supporting evidence. For instance, the filing states, there are some 16 Mary Lamb's listed in Nebraska phone books and there are four Harry Potter's listed in Indiana, two of the states where drugs were shipped.
The motion regarding fake names came amid a barrage of filings as the April 29 trial date in U.S. District Court in Boston, Mass. is approaching. In other filings lawyers for defendants Michelle Thomas and Kathy Chin sought to bar the use of dozens of government exhibits and to bar any mention of patient harm.
The two licensed pharmacists worked at NECC to check completed prescriptions against the orders actually placed by NECC's customers. The two are charged with a half dozen violations of the federal Food Drug and Cosmetic Act.
"Chin and Thomas had no responsibility for checking prescriptions or patients names," one of the motions states, adding that their job, as "low level" employees, was simply to check to make sure that the right orders were going to the right customers. And, they contend, the two had no responsibility to check patient names.
Chin and Thomas were among 14 indicted in late 2014 following the two year grand jury investigation of the 2012 fungal meningitis outbreak which sickened nearly 800 patients, over 100 of whom are now dead. In three prior trials seven defendants have been found guilty of charges ranging from racketeering to mail fraud and violations of federal drug statutes.
As for the fake names, the motion asks the judge to bar the use of the term "fake names" unless the government proves in advance that the names are in fact not real patients. While some names might appear as questionable "at first blush," they may not be fictitious at all, the motion states. To date, the defendants argued, prosecutors have failed to provide "even a modicum of proof that the names, including Donald Duck and Donald Trump, are false.
"Things are not always as they seem," the motion states, adding that some of the names "may not be fictitious at all."
They asked for a separate hearing on the "fake names" issue.
In the other motions to bar the use of some exhibits or limit testimony, defense lawyers Michael C. Bourbeau and Joan Griffin called on presiding U.S. District Judge Richard G. Stearns to "keep the government focused on the specific counts in the indictment by limiting the evidence that is remote and unfairly prejudicial."
As in the trial of other co-defendants, attorneys for Chin and Thomas are also asking that testimony be barred or limited relating to the deaths of NECC patients because neither of the two are charged with playing any role in those deaths.
Also filed were proposed pre-trial instructions to the jury and final instructions presented just prior to deliberations.
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Appeals Denied for Two NECC Defendants

By Walter F. Roche Jr.

Concluding that the jurors findings of guilt were justified by the evidence, a federal judge today denied the appeals of two of five defendants convicted on charges ranging from racketeering to mail fraud in the probe that followed a deadly 2012 fungal meningitis outbreak.
In two separate but overlapping decisions U.S. District Judge Richard G Stearns sitting in Boston, Mass. denied the acquittal motions filed by two pharmacists employed at the now defunct drug compounding company blamed for the outbreak. He also denied motions filed by Gene Svirskiy and Christopher Leary for a new trial.
The two were among five convicted late last year following a 10-week trial. Appeals of the three remaining defendants are still pending.
Leary was convicted of mail fraud and violations of the Food Drug and Cosmetic Act FD&C), while Svirskiy was convicted of racketeering, conspiracy, mail fraud and violations of the FD&C.
Both defendants had argued that they were unfairly prejudiced by limited trial testimony about the deaths from the 2012 fungal meningitis outbreak when the charges they faced did not involve the drugs that caused the outbreak.
Stearns, however, cited his repeated instructions to the jury noting in which he stressed that the defendants were not involved in producing the deadly steroids. He allowed limited testimony on the outbreak, he noted, so that jurors could understand why the New England Compounding Center came under such close scrutiny
"While the issue was a delicate one," Stearns wrote, "I am confident that the correct balance between the jury's right to know and the defendants' right not to be prejudiced by too much extraneous information was struck."
In the 13-page Svirskiy decision Stearns said prosecutors presented ample but not overwhelming evidence for the jurors to conclude that he was a participant in a conspiracy. He noted that Svirskiy instructed an unregistered drug technician to leave the clean room when state inspectors appeared at the Framingham, Mass. facility.
He said evidence showed Svirskiy and others were aware of test results showing mold and bacteria were present in the clean room where sterile drugs were being prepared.
"Yet no meaningful remediation was undertaken," the opinion states.
While both Svirskiy and Leary had argued that they had never had any direct communication with NECC's customers, Stearns concluded that was not necessary to prove their involvement. He wrote that the issue was not whether they made any direct misrepresentations to NECC's customers but whether they were knowing participants in a scheme to defraud those customers.
Citing trial evidence he concluded that Leary was aware there had been a "fungal bloom" at NECC in the months preceeding the outbreak.
"The jury heard ample evidence that Leary was aware of the widespread (if episodic) contamination in the clean room," the 12 page Leary decision states.
As for the motions for a new trial Stearns said Svirskiy's four arguments were "not load bearing" and Leary's did not meet the strict standards to justify a new trial.
Svirskiy's sentencing is set for May 29, while Leary's is set for the following day.
Stearns has yet to rule on the appeals filed by two other defendants, Gregory Conigliaro and Sharon Carter, who were convicted along with Svirskiy and Leary. In a related matter Conigliaro today filed a motion asking for a further delay in his sentencing until July 15 or later.
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Conigliaro Faces License Loss

By Walter F. Roche Jr.

A key defendant in the criminal case stemming from a deadly 2012 outbreak is facing the possible loss of his real estate license following his conviction on charges that he conspired to defraud the U.S. Food and Drug Administration.
A notice to show cause why his real estate salesman's license should not be revoked or suspended has been sent to Gregory Conigliaro, who was the the vice president and part owner of a drug compounding firm blamed for the deadly fungal meningitis outbreak.
The five-page notice dated March 26 was accompanied by a letter from Daniel Maltzman, prosecuting counsel to the Massachusetts Division of Professional Licensure.
As the letter and notice state, Conigliaro was issued a license as a real estate salesman on Dec. 7, 2013. That was a year before he and 13 others were indicted following a two year federal grand jury probe of the 2012 outbreak. State and federal regulators concluded that NECC steroids saturated with fungi were responsible for the outbreak.
He and four other were convicted in December of last year.
In the notice to Conigliaro, Massachusetts officials told him that he had a right to request a hearing within 21 days of the notice. He has the same amount of time to file a response to the complaint.
In addition to his conviction on the federal charges the notice states that Conigliaro violated state law by failing to notify the state Real Estate Board of his conviction.
As for the conviction itself, the notice states that it "demonstrates a lack of good moral character." In addition the notice states,"Your conduct also constitutes unprofessional conduct, conduct which undermines public confidence in the real estate profession."
Conigliaro has appealed his conviction. He is scheduled for sentencing on June 17.
The other defendants who were convicted along with Conigliaro are facing similar actions by the Massachusetts Pharmacy Board. Three of the four held pharmacy licenses while the fourth was a licensed pharmacy technician. Conigliaro did not have a pharmacist's license.
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NECC Defendant Fights Jail Time

By Walter F. Roche Jr.

A convicted defendant in the case stemming from a deadly fungal meningitis outbreak is disputing a pre-sentence report that would lead to a prison term in an upcoming sentencing hearing.
Alla Stepanets, one of five convicted late last year after a 10 week trial,says the conclusion that she should serve a prison term violates her constitutional rights and mis-states her role at the New England Compounding Center, the company blamed for the 2012 outbreak which led to the deaths of over 100 patients across the country.
In a six-page filing in U.S. District Court in Boston, Mass., the lawyer for Stepanets, stated that his client "was merely the last pharmacist who handled the (NECC) orders prior to their introduction into interstate commerce."
John Cunha, Stepanets' attorney, said she acted as a checker and not the verifying pharmacist for orders shipped from NECC. That role, he said, was performed by other NECC staffers before his client even handled the drugs.
Stepanets and four other defendants were convicted in December of charges ranging from racketeering to conspiracy and mail fraud, but as Cunha noted, his client was cleared of the more serious charges. He said the jurors acquitted her on charges that she meant to deceive NECC clients.
Calling her role "purely clerical," Cunha said her role at NECC "failed to employ any special skill the defendant possessed as a pharmacist."
He further charged that holding Stepanets to a strict liability standard for a misdemeanor is unconstitutional.
Stepanets was one of three pharmacists who check prescription orders after they left the clean room where they were prepared.
In the filing Cunha said there was no evidence that his client was aware that the patient names on the prescriptions she checked were not legitimate. Evidence presented at her trial showed prescriptions were routinely issued for non existent patients including Donald Duck and Donald Trump.
Stepanets' sentencing is scheduled for May 1 before U.S. District Judge Richard G. Stearns. He previously cleared Stepanets of the pending charges but they were reinstated by an appeals court.
She was one of 14 indicted in 2014 following a two year probe of the fungal meningitis outbreak. The trial of the two remaining defendants is scheduled to begin late this month.
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NECC Sentencings Pushed Back

By Walter F. Roche Jr.

Even as their appeals are pending, defendants convicted in the case stemming from a deadly 2012 meningitis outbreak have had their sentencing sessions delayed by weeks or months.
In a series of orders issued over the past few months, U.S. District Judge Richard G. Stearns has granted motions to delay sentencing for most of the five convicted late last year on charges ranging from racketeering to conspiracy and mail fraud.
Lawyers for those seeking delays have noted in filings in U.S. District Court in Boston, Mass. that if the appeals are successful, any sentencing would be moot.
Under one Stearn's orders Gregory Conigliaro, who was convicted of conspiracy to defraud the U.S. Food and Drug Administration, will be sentenced on June 17 at 3 p.m. Conigliaro was vice president and part owner of the New England Compounding Center, the company that produced steroids contaminated with deadly fungi.
Gene Svirskiy's sentencing has been re-set for 3 p.m. on May 29, while Christopher Leary will be sentenced on May 30 at 9 a.m. Both were NECC pharmacists.
Sharon Carter's sentencing has been set for June 18 at 10 a.m. Alla Stepanets' sentencing has been set for May 1 at 10 a.m. Carter was a pharmacy technician while Stepanets was a licensed pharmacist.
Scott Connolly, who entered a guilty plea prior to the 2018 trial, has his sentencing set for 3 p.m. on July 19. He pleaded guilty to nine counts of mail fraud prior to the 2018 trial.
The final trial for the two remaining NECC defendants, Kathy Chin and Michelle Thomas, is set for April 29.
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Chin Returned to PA Prison

By Walter F. Roche Jr.

A week after he was released from a Michigan jail and turned over to federal marshals, one of the key figures in the 2012 fungal meningitis outbreak has been returned to a federal prison in Pennsylvania to serve the remainder of his eight year sentence.
Records of the federal Bureau of Prisons show Glenn A. Chin, 50, was checked in today to the federal prison in Allenwood, PA. He had been confined at the Livingston County Prison in Michigan to face arraignment on second degree murder charges.
Chin and co-defendant Barry Cadden, 52, are scheduled to return to Michigan for another pre-trial hearing on June 11.
Cadden, who like Chin was convicted on federal racketeering and mail fraud charges, was returned to the federal prison in Loretto, PA. late last week. Cadden is serving a nine year federal prison sentence.
The two were charged late last year with second degree murder in the deaths of 11 Michigan victims of the outbreak.
Federal prosecutors had also charged the two with second degree murder-racketeering charges but two federal juries could not reach a unanimous verdict on those counts.
Cadden was president and part owner of the New England Compounding Center, the company that shipped fungus contaminated steroids which caused the deadly 2012 outbreak. Chin was a supervising pharmacist in the clean room where the deadly drugs were prepared.
There had been speculation that the two would be sent to a federal prison in Michigan pending the trial in that state, but that plan has apparently been put on hold.
In a related development federal officials have continued to gather assets from Cadden to meet a $7.5 million forfeiture order issued in federal court in Boston following his conviction. Funds gathered thus far by U.S. Marshals total more than $1 million.
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