Ex-executives of Bolar charged with conspiracy 4 from generic-drug company said to engage in 6 years of corruption.

October 11, 1991|By Kelly Gilbert | Kelly Gilbert,Evening Sun Staff

Bolar Pharmaceutical Inc.'s former president, executive vice president and two other high-ranking officials have been charged with conspiracy and related counts tied to at least six years of corruption in the company's manufacture of generic drugs.

The four were charged yesterday in a five-count criminal information document and a 19-count indictment filed in U.S. District Court in Baltimore by a grand jury and prosecutors in a federal generic drug task force based here.

Each of the defendants is charged with conspiring to "evade, defeat and obstruct" the U.S. Food and Drug Administration's generic drug approval process, from at least February 1984 to early 1990.

Court papers said the defendants directed the falsification or destruction of generic drug production records; substituted Bolar drugs for so-called "innovator," or original, drugs in FDA-required bioequivalency tests so the company's generic drugs would be tested against themselves; filed myriad false reports with the FDA; and took manufacturing shortcuts that resulted in sales of unapproved drugs to the public.

The defendants include:

* Robert Shulman, 58, of Centerport, N.Y., Bolar's former president, chief executive and board chairman, who is charged with two false statement counts, one count of wire fraud and one count of obstructing an FDA investigation in addition to one conspiracy count.

Shulman was charged in the criminal information, which suggests that he has agreed to plead guilty to the charges.

* Jacob H. "Jack" Rivers, 62, of Great Neck, N.Y., Bolar's former executive vice president and a director, indicted on a conspiracy charge, six false statement counts and three counts of obstructing FDA investigations.

* Charles G. Dicola, 41, of Hauppage, N.Y., Bolar's former production manager and vice president of operations, indicted on a conspiracy charge and five counts of shipping adulterated generic drugs in interstate commerce.

* Arnold S. Mendell, 47, of Lake Grove, N.Y., Bolar's former quality assurance director, indicted on a conspiracy charge, four counts of shipping adulterated generic drugs in interstate commerce and four counts of obstructing FDA investigations.

In all, eight former Bolar officials have been charged in a continuing investigation of the generic drug industry. Four have pleaded guilty and have been cooperating with task force investigators.

Prosecutor Gary P. Jordan said the government's investigation of Bolar is now ended. But he said the task force still is investigating other generic drug makers.

Bolar pleaded guilty to 20 criminal charges earlier this year -- most of them directly connected to yesterday's charges -- and agreed to pay a $10 million fine, the largest ever imposed against a federal criminal defendant in Maryland. The company also agreed to pay the government $238,000 for the cost of the investigation.

Bolar's new management said then that the company has withdrawn, or would withdraw, 159 products from the market, and has waived its FDA approvals to sell those products until it the agency reapproves them based on current ingredients and tests.

According to the documents filed yesterday, Shulman and Rivers orchestrated alleged schemes in which Bolar officials kept two sets of production records, accurate ones and phonies that were given to FDA investigators to justify the company's generic drug-making processes.

They also ordered Bolar employees to hide records from FDA investigators; fabricate testing and manufacturing data; and submit phony test results to agency regulators, the court papers said.

In addition, Shulman and Rivers recruited Mark B. Perkal, the former executive vice president of PharmaKinetics Laboratories Inc., of Baltimore, to help them cover up product-switching in FDA-required tests.

Perkal and PharmaKinetics, Bolar's major drug-tester, pleaded guilty in May to charges of obstructing FDA investigators, and the company agreed to pay a $200,000 fine.

The indictment yesterday charged Dicola and Mendell with direct involvement in falsifying records, the illegal manufacture of Bolar's generic drugs and the shipping of them to customers.

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