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Justice News

Department of Justice
U.S. Attorney’s Office
District of Utah

Tuesday, April 7, 2015

Cache Valley Cancer Treatment And Research Clinic Pleads Guilty To Misdemeanor Information Involving Receipt And Delivery Of Misbranded Drugs

           SALT LAKE CITY – Cache Valley Cancer Treatment and Research Clinic, a cancer treatment clinic located in Logan, pled guilty in U.S. District Court Tuesday afternoon to receipt of misbranded drugs and delivery for sale.  The Misdemeanor Information charging the clinic was filed March 31, 2015. The clinic is owned and operated by Dr. Ali Ben-Jacob, a resident of Utah and an oncologist.

            U.S. Magistrate Judge Dustin Pead imposed a six-month term of probation for the Clinic at Tuesday’s hearing.  The clinic also must pay a fine of $175,000 and a forfeiture money judgment of $775,000.

            According to court documents filed in the case, from about September 2009 to about September 2011, the Clinic received misbranded prescription oncology drugs from Quality Specialty Products (QSP) in Winnipeg, Manitoba, Canada. The drugs were “misbranded” because they came from a foreign drug establishment and were not listed annually with the U.S. Food and Drug Administration (FDA) by the foreign drug establishment as being manufactured for commercial distribution in the United States.  The drugs included Abraxane, Aloxi, Gemzar, Anzemet, Camptosar, Eloxatin, Faslodex, Herceptin, Mabthera, Neupogen, Taxotere, Velcade, and Zometa.

            Over the two year period, the Clinic paid in excess of $3.6 million for these prescription drugs which had not been listed by the FDA as being manufactured for commercial distribution in the United States.  Approximately one-half of these prescription drugs were reimbursed by federal government programs, including Medicare, Tricare, and the Federal Employees Health Benefits Program.  The Clinic resolved a civil claim with the Department of Justice brought on behalf of the FDA and federal government programs.

            Prosecutors say there was no evidence uncovered during the course of the investigation establishing patient harm from the use of the drugs from QSP or that the drugs were counterfeit. The Clinic stopped ordering and using the misbranded drugs before it was contacted by government investigators.

           “The doctor did not, however, advise his patients that he was using misbranded drugs obtained from a supplier outside the United States,” U.S. Attorney Carlie Christensen said today. “The FDA rules are in place to protect the safety and integrity of prescription medications used in the United States.  Prosecuting these kinds of cases minimizes the chances of patients receiving unsafe medicine and ensures that government and private insurance programs are paying for approved drugs.”

            “The FDA protects consumers by ensuring that they receive FDA-approved safe and effective drugs,” said Catherine A. Hermsen, Special Agent in Charge, Kansas City Field Office, FDA’s Office of Criminal Investigations. “We will continue to pursue individuals and corporations who place the public health at risk when they bypass this protective system.”

             The case was investigated by FDA’s Office of Criminal Investigations, with the assistance of the U.S. Department of Health and Human Services – Office of Inspector General’s Office of Investigations; the U.S. Department of Defense’s Defense Criminal Investigative Services; and the U.S. Office of Personnel Management.  In at least six related cases, QSP delivered similar unapproved, misbranded cancer treatment prescription drugs to physicians and practices in other areas in the United States. These cases were successfully prosecuted, in conjunction with FDA’s Office of Criminal Investigations.

Updated April 8, 2015