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False statements to federal officials, false records, and unapproved manufacturing procedures led to the conviction of two executives of a Pennsylvania generic drug manufacturing firm. In addition, the firm pleaded guilty to similar charges and was ordered to pay a $3,250,000 fine.
On March 31, a jury in the U.S. district court for the district of Maryland found Suhas V. Sardesai guilty of seven felony counts of lying to FDA and violating the Food, Drug, and Cosmetic Act. Sardesai was senior vice president of operations for Mutual Pharmaceutical Co., Inc., Philadelphia. The jury also found Edmund J. Striefsky, director of quality control for Mutual, guilty of six counts.
The charges included conspiracy to defraud FDA, preparing and maintaining false production records that failed to reflect reprocessing, batch number switches, intermingling of several batches, failing to file supplemental new drug applications before making changes in manufacturing processes, and false statements in annual reports to FDA.
The illegal activities first came to the government's attention in May 1992, when a former production manager at Mutual contacted the U.S. Attorney's Office in Baltimore. According to the informant, Mutual had problems in manufacturing several of its generic drug products according to the formulas and methods it had submitted to FDA in its abbreviated new drug applications. The agency had approved the firm's applications, and rather than seek supplemental approvals from FDA as required by law, Mutual routinely reprocessed some products by illegally using unapproved ingredients and manufacturing procedures. Mutual concealed these actions from FDA by creating and maintaining false records, and by filing false reports.
During an FDA inspection of the firm in July 1989, Sardesai told an investigator that Mutual had never reprocessed any batches, and if the firm decided to do so in the future, it would get FDA approval before beginning.
FDA employees with the agency's generic drug task force began interviewing current and former Mutual employees during the summer and fall of 1992. All of those interviewed corroborated the original informant's allegations.
According to these employees, Mutual routinely had problems with low tablet hardness and with tablets splitting and sticking to the equipment. At the direction of Sardesai and Striefsky, Mutual employees returned these batches to the blending department for remilling and remixing, and sometimes added extra lubricants such as magnesium stearate. Remilling tablets or adding additional lubricant can affect the bioavailability of a drug. The batch numbers of these reworked batches were often switched with other batches of the same product in order to maintain a sequential batch numbering system so that the additional processing would not be detected by FDA.
Subsequently, the reworked batches would either be intermingled with other batches of the same product, resulting in a loss of batch purity and identity, or sent back to the tableting department for recompression. Among the products Mutual reworked were acetazolamide 250-mg tablets, a prescription medication used to treat congestive heart failure and glaucoma, and sulfasalazine 500-mg tablets, a prescription antibiotic.
Some Mutual production employees gave the task force handwritten notes of the reworking and intermingling of drug batches, and photocopies of internal Mutual records, which also corroborated the allegations.
In September 1993, FDA asked the Justice Department to initiate a grand jury investigation. In April 1994, the grand jury for the District of Maryland indicted four of the firm's executives.
Mutual pleaded guilty to seven counts of criminal violations involving interstate shipments of adulterated prescription medications on July 22, 1994. At that point, the court imposed the fine.
On March 31, 1995, after a seven-week trial, a jury convicted Sardesai and Striefsky. At press time, sentencing had not been scheduled.
Production employee Sunil C. Shah was found not guilty on all counts. The jury convicted quality assurance manager Kirit R. Patel on one count, but was not able to reach a verdict on the other counts. The government has not decided whether to retry Patel on those counts.
Isadora B. Stehlin is a member of FDA's public affairs staff.
Finally, the statement that "because STP was used in levels exceeding the limits allowed under good manufacturing practices the product was regarded as unsafe for human consumption" was also incorrect. Although Randazzo was convicted of using STP in shrimp products in which STP was prohibited, there is no evidence that New England Shrimp Company's product was unsafe due to the use of STP. Rather, the harm caused by the STP abuse was economic fraud.
The destruction was one of several measures the hair products' distributor, World Rio Corp. of Los Angeles, agreed to take in a consent decree entered in the U.S. District Court for the Central District of California on Sept. 1, 1995. The company also agreed not to sell another product like the two destroyed and to use FDA's Cosmetic Product Experience Report to report to the agency any adverse reactions from any hair straighteners it markets.
In 1994 and early 1995, more than 3,000 people reported to FDA that their scalp itched or burned and that their hair broke off or fell out--and, in some cases, turned green--after using the hair relaxers Rio Hair Naturalizer System and Rio Hair Naturalizer System with Color Enhancer.
Based on the complaints and an FDA investigation, the agency alleged that the hair products were being illegally sold in the United States because:
Adverse effects experienced by consumers were consistent with those seen with harmful substances.
Their labeling was false. The products' labeling listed an acid pH level of 3.4, but FDA analysis revealed that the pH was significantly less than 3.0. In addition, FDA alleged the labeling falsely described the products as "chemical free," even though the ingredient labels listed substances commonly recognized as chemicals.
Ingredients, such as mineral salts, were not listed by their common or usual name, as required.
The products were destroyed in Nevada in June 1995 and in California in October 1995.
FDA and state government offices around the country began receiving complaints about the Rio hair products in mid-1994. Many complainants said they had bought the hair relaxers by mail after viewing a 30-minute TV infomercial targeted to African Americans.
Some complainants reported that their hair began falling out immediately after applying the products, while others said they had problems after multiple applications. Some said they had seen doctors for treatment of scalp irritation. Many women said they had to cut their hair short to deal with bald spots.
FDA collected samples of the hair relaxers on Nov. 6 and 8, 1994, at a Los Angeles-based affiliate, Pantron I Corp., of World Rio. Most of the products, which were imported from Brazil, were in the possession of Product Packaging West, also known as Pic 'N' Pac West, of North Hollywood, Calif.
On Nov. 23, the California Department of Health embargoed the products held in Los Angeles and North Hollywood, essentially blocking their sale in the United States. On Dec. 21, FDA issued a talk paper advising against use of the products after laboratory findings identified the low pH and the number of consumer complaints indicated that the hair relaxers were causing adverse reactions.
About the same time, World Rio stated it would stop all sales of the products. But, FDA received reports from consumers that the company may still have been taking orders and billing customers through a mail-order company, Addressing and Mailing Inc., in North Las Vegas, Nev.
On Jan. 23, 1995, at FDA's request, U.S. marshals seized the entire lot of products at Product Packaging West in California.
On Jan. 24, an investigator with FDA's San Francisco district office went to Addressing and Mailing to inspect the firm and found more than 8,000 cases of the Rio hair relaxers, worth about $500,000 in retail value. FDA notified the State of Nevada Division of Health, which, in turn, embargoed the products, thus preventing their sale.
On June 14, World Rio voluntarily destroyed the 8,000 cases of Rio hair relaxers held at Addressing and Mailing in Nevada.
Under the terms of the consent decree between the United States and World Rio, the company agreed to destroy the product kits seized at Product Packaging West, although it was allowed to retain some of the kits for use in product liability litigation and for laboratory analysis. These kits must be held by a custodian and be destroyed at the end of the litigation. The company faces about 200 individual lawsuits.
Under the consent decree, World Rio agreed, among other things, not to sell a reformulated hair relaxer or similar product until the product is tested for safety, the results of those tests are shared with FDA, and World Rio notifies FDA of the date on which it will begin marketing the new product.
--Paula Kurtzweil
David L. Hogan, owner and operator of Hogan's Misty Meadow Dairy in Tillamook, Ore., signed the order July 5, 1995, in the U.S. District Court for the District of Oregon after an FDA investigation documented illegal drug residues in calves he sold at market.
A follow-up inspection by FDA Aug. 17 found the dairy to be in compliance with the terms of the injunction.
Hogan's dairy is primarily a milk farm. At the time of the investigation, it had a milk-producing herd of 700 cows out of a total herd of 850 adult animals. It also had about 850 replacement calves in different stages of growth, and it sold approximately 450 bull calves each year for veal.
A calf that is given a drug or that has nursed from a drug-treated cow must be withheld from the market until the drug withdrawal time is complete. Residues in animals sold for food can present public health risks both directly from the meat (for example, to someone who is allergic to the drug) and by contributing to the development of resistance to antibiotics.
"To keep cows milking, they have to be impregnated periodically," explains FDA Seattle district compliance officer Tom Piekarski. "They dry up eventually, but when they deliver a calf, the milk starts flowing again. Female calves are kept as replacements. Bull calves go straight to market, within hours to days of birth," he says.
When calves go to market, the U.S. Department of Agriculture samples portions of tissue--the liver, kidney, and sometimes muscle--from virtually every calf right at the slaughterhouse, Piekarski says. If illegal drug residues are found, the carcass is condemned and USDA notifies the producer and FDA. FDA then inspects the producer.
An FDA inspection of Hogan's dairy on Aug. 17, 1994, found that a calf that had tested positive for drug residues in USDA's sampling program had been slaughtered at Hogan's dairy June 15. The USDA analysis showed illegal residues of the antibiotic neomycin in the calf's kidney. This was not the first violative residue found in calves from Hogan's dairy. FDA inspections and USDA sampling dating from March 1990 documented 16 illegal residues of streptomycin, neomycin, gentamicin, and oxytetracycline in his animals.
"Tissue residues in calves can come either from treatment right around birth or from the mother if the cow was treated," Piekarski says, "so that records must be maintained on both the adult animals and the calves." Hogan admitted he fed calves milk from treated cows and did not keep medication or treatment records. Despite the lack of records, investigators located at the dairy sources of the residues found in the animals: gentamicin and a stress formula containing neo-terramycin.
FDA had issued a warning letter to Hogan March 27, 1992, regarding the violations, but he continued to ship calves with residues. After USDA notified the agency of the most recent violation, FDA inspected again in June and August 1994. Because the violations persisted, in November FDA asked the Department of Justice to file a complaint for injunction, which it did July 20, 1995, after negotiating with Hogan. The resulting consent decree prohibited Hogan from selling veal calves for slaughter until he complied with the terms of the decree, which include the following:
Medicated bulls and cows must have a band affixed with the date of banding or the date of medication, whichever is later.
Medication for the bulls and calves must be used in accordance with the labeling, and tissues from these animals cannot be sold until the withdrawal period for the medication is passed.
Calves intended for sale must be segregated in separate pens from those not intended for sale.
If a calf is medicated or fed milk from a medicated cow, the medication for the calf or cow must be used in accordance with its labeling; the calf must be marked for identification; and written records must be kept showing the identity and date of medication, the amount and method of administration, the withdrawal period for the medication, the date the withdrawal period expires, the date the calf was sold, and the name and address of the purchaser.
Such a calf cannot be sold until the withdrawal period has lapsed.
--Marian Segal