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A manufacturer of gynecological surgical devices was sentenced to a 15-month prison term after pleading guilty to intentionally selling unsterilized instruments labeled as "sterile" and providing FDA false information.
The manufacturer and the company also were ordered to pay &37,004 each to the hospitals and clinics that had returned the instruments. All the unsafe devices were recalled, seized and destroyed under FDA supervision.
After hearing testimony at the Sept. 17, 1997, presentencing hearing, Judge Frederick Scullin, of the U.S. District Court for the Northern District of New York, also placed International Medical Technologies Group Inc. (IMTG) on five years' organizational probation and ordered its president, John Sturgeon, to withdraw his device marketing clearances and avoid involvement in the manufacture of drugs and devices for one year after serving his sentence.
IMTG sold syringes, aspiration catheters, surgical tubing, cervical dilators, curettes for sampling tissue, and tissue collection sets for use in surgical gynecological procedures such as abortion, treatment of abnormal uterine bleeding, and uterine sampling for diagnosing cancer. These are considered sterile surgical procedures, and doctors have traditionally demanded sterile instruments for performing them. The risk of infection is one of the major hazards of these procedures because infection may lead to blood poisoning, infertility and death.
At the hearing, Eugene Williams, M.D., an obstetrician-gynecologist now retired from FDA's Center for Devices and Radiological Health, testified that the unsterilized devices created a serious risk of harm from infection and that data gathered by the agency's Buffalo, N.Y., district office indicated that a fourfold increase in infections at one clinic was likely due to the use of unsterilized IMTG devices the clinic had received.
The company's poor practices came to FDA's attention in January 1993, when three former IMTG employees complained to the agency's Albany, N.Y., resident post that the company was shipping unsterilized products labeled as "sterile."
Early in 1993, Nancy Saxenian and Michael Sinkevich, investigators with FDA's Buffalo district office, inspected IMTG.
Initially, Sturgeon gave the investigators company records showing that surgical devices labeled as sterile and distributed to hospitals and clinics had been sterilized by Medical Device Sterilization Inc., of Saratoga, N.Y. But when Saxenian and Sinkevich tried to locate the company, they could find no evidence of its existence. Confronted with this finding, Sturgeon admitted that he'd fabricated the records, intentionally giving false information and knowingly labeling the unsterilized devices as sterile. FDA's approvals of the devices called for them to be sterilized with ethylene oxide, but Sturgeon said sterilization was too costly.
The investigators examined Sturgeon's records, noting that one load of curettes had been sent to a Northborough, Mass., company for sterilization. But the records also showed that, of a batch of 1,825 curettes, only 1,500 had been sterilized. When FDA asked Sturgeon to identify which instruments had been sterilized and which were in commercial distribution, Sturgeon was unable to do so. As a result, FDA urged Sturgeon to recall from the market all curettes made by the company.
As the inspection progressed, the investigators found other problems, including:
At the end of the inspection, the investigators reported their findings to Sturgeon, who gave them copies of written manufacturing procedures he said he intended to put in place to meet FDA requirements.
However, FDA found the procedures to be inadequate and decided to take further action.
"In light of the extensive manufacturing problems and Sturgeon's history of falsifying records and shipping potentially hazardous unsterilized devices as sterile, particularly when faced with economic incentives, we decided to go for seizure," says James Kewley, a compliance officer with FDA's Buffalo district office.
Accompanied by Saxenian and Sinkevich, a U.S. deputy marshal seized the devices in August 1993. Saxenian witnessed destruction of the devices, valued at &100,000, in February 1994.
FDA continued to investigate Sturgeon and IMTG through a federal grand jury in New York. "We interviewed many current and former employees," says John Thompson, a team leader in FDA's Buffalo district. "From the interviews, we learned that Sturgeon had engaged in a coverup involving not only false sterilization records but also false manuals on standard operating procedures."
Sturgeon and IMTG were indicted in August 1996. They pleaded guilty four months later.
Dixie Farley is a staff writer for FDA Consumer.
An FDA investigation begun in 1990 revealed that the company's illegal activities cost end-user companies more than &1.7 million in product losses.
Judge Joseph E. Stevens Jr., of the U.S. District Court for the Western District of Missouri, imposed the most recent fines last April. He ordered the company, Flavine International Inc., Closter, N.J., to pay &925,000; its owner, Gerd Weithase, &75,000; and vice president, Wolf Vogel, &10,000. He also sentenced Weithase to two years in prison and Vogel to home detention for six months and gave both probations of as much as three years.
The men were part of a scheme in which Flavine bought bulk amounts of a veterinary antibiotic ingredient, oxytetracycline (OTC) base, and the human antibiotic gentamicin sulfate from unapproved sources in China for substantially less than the price of legitimate products. The company then resold them to U.S. drug companies at inflated rates.
Besides constituting economic fraud, the scheme posed a risk to food animals and humans because these counterfeit drugs are of unknown quality and potency.
The case began in May 1990, when an industry source contacted FDA's Omaha, Neb., resident post with information linking Flavine to the counterfeit OTC base. The source stated that Flavine had imported about 310 metric tons of OTC base from China in 1989. But the company's legitimate Chinese manufacturer, Long March Pharmaceutical Plant, which is approved by FDA, had made only 100 metric tons of the chemical that year. Thus, officials say, at least part of the shipments likely came from unknown, unapproved sources.
In June 1991, FDA investigator Michael Spangenberg visited the Long March plant in China and took pictures of legitimate bulk OTC containers. After he returned to the United States, he inspected SmithKline Beecham Animal Health, in Omaha and determined that the bulk materials there were counterfeit because the containers were different from those in China.
Over the next three years, FDA and U.S. Customs officials seized suspected counterfeit materials from five end users and warehouses. The material came from Flavine and other possible suppliers. Among the seizure sites were the Port of Baltimore; Fermenta Animal Health, Elwood, Kan.; and Sanofi Animal Health, Le Sueu, Minn. Much of the material was later destroyed after being proven counterfeit.
In May 1993, after establishing probable criminal activity, special agents from FDA's Office of Criminal Investigations (OCI) and the U.S. Customs Service executed a search warrant at Flavine's New Jersey headquarters. At the same time, agents executed searches at the company's Kansas City, Mo., offices and at the residence of company vice president Ira "Rip" Siegel in Parkville, Mo.
In reviewing records seized during the search, OCI and Customs agents learned that Flavine was using a North Carolina company to repackage some of the 20-kilogram drums of counterfeit OTC base into 25-kg drums. The agents concluded that the company used this maneuver to hide its sale of counterfeit products by repackaging materials to look like they were from Long March, the legitimate Chinese manufacturer, which packs its OTC materials only in 25-kg drums.
Between December 1993 and February 1994, OCI also analyzed import information, determining that out of all the company's OTC base shipments, almost half--277,325 kg--of the shipments came from Chinese sources other than the legitimate supplier and were likely counterfeit.
These suspicions were backed up in May 1994, during an OCI and Customs interview with Long March official Dejun Meng. He confirmed that numerous shipments of OTC base, sold by Flavine under the Long March name, were not made by Long March. He outlined for agents several ways they could distinguish Long March materials from counterfeit by examining the products' certificates of analysis.
In December 1994, OCI, Customs, and the Justice Department's Office of Consumer Litigation interviewed former Flavine employee W. Mark Paradise. He verified that numerous shipments of OTC base had not been produced by Long March but were sold in the United States as such.
Agents also reviewed Flavine's shipment record of other bulk drugs it bought from overseas. They found that Flavine had counterfeited several other drugs, including gentamicin sulfate, an antibiotic used to treat bacterial infections, such as those caused by Streptococcus pneumoniae, in humans and animals. Long March also makes gentamicin sulfate, and, again, Meng verified for agents that some of the bulk gentamicin sulfate sold by Flavine under the Long March name was not made by his company.
On Jan. 24, 1995, a federal grand jury returned an 11-count indictment charging Flavine International, Weithase, and several of his associates with conspiracy, smuggling, misbranding, and other federal drug violations.
In September 1995, French police arrested Weithase in Paris, where he had fled after escaping to Germany to avoid prosecution. Accompanied by U.S. marshals, Weithase returned to the United States in January 1996 after being turned over to U.S. authorities by the Justice Ministry of France.
Initially, Weithase pleaded not guilty to the charges. But on March 20, 1996, he, along with his company and associates Vogel and John Milhard, Flavine's traffic manager, admitted guilt to charges of conspiracy, money laundering, and counterfeiting. They were sentenced last April 9. Milhard was placed on probation for one year and fined &5,000. Two days earlier, Flavine employee W. Mark Paradise was sentenced for his part in the counterfeiting scheme to six months' home detention, a &25,000 fine, and five years' supervised probation.
Flavine International Inc. is still in business and now deals in legitimate products, FDA officials say.
--John Henkel
The Face Colours Glow-in-the-Dark Cream Makeup, manufactured by Zauder Brothers Inc. of Freeport, N.Y., contained an unapproved color additive, zinc sulfide, added to the makeup to achieve a glowing appearance.
While FDA has not received any reports of injuries from the makeup, the agency considers zinc sulfide unsafe until it concludes that studies have been submitted to prove its safety.
Zauder Brothers recently sought approval of zinc sulfide by submitting a color additive petition, as stated in an Oct. 6, 1997, Federal Register notice.
FDA has been aware of these glow-in-the-dark makeups since the 1970s and has cited eight manufacturers for violations. Most of the manufacturers stopped making the products after FDA contacted them.
FDA first inspected the Zauder Brothers' facility in October 1993, after an informant complained to the agency about the sale of the illegal makeup. Investigators with FDA's New York district office collected product samples, and FDA lab tests confirmed that the product contained zinc sulfide.
In a March 4, 1994, warning letter, FDA cautioned Zauder Brothers that the agency might take further action if the company continued to manufacture and sell the illegal product.
But the company didn't stop making and selling it, as evidenced by continuing tips from informants and an FDA re-inspection of the Zauder facility in October 1996.
In April 1997, FDA filed a complaint against the glow makeup in the U.S. District Court for the Eastern District of New York, and U.S. marshals, accompanied by FDA investigators, seized 185 cartons of the makeup, valued at &3,800.
In September 1997, Zauder Brothers entered into a consent decree under which the U.S. Marshals Service will destroy the seized glow makeup. At press time, the makeup had not yet been destroyed.
William Friedrich, an investigator with FDA's New York district office, anticipates that his office will inspect the company's facility again as the next Halloween season approaches.
--Tamar Nordenberg
FDA Consumer magazine (January-February 1998)