Pharmakon Compliance Director Pleads Guilty to Conspiracy Charges

Sherman, set the Way-Back Machine.

A press release from the U.S. Department of Justice announced that the former Compliance Director of Pharmakon Pharmaceuticals, Inc. has pleaded guilty in Indiana to conspiring to defraud the United States government by lying about failed potency tests of drugs that the pharmacy had compounded. This brings back memories to me about another Pharmakon, in another part of the world.

But, first, the current news. Caprice Bearden was indicted earlier this year by the U.S. Attorney’s Office for the Southern District of Indiana for her conduct while Director of Compliance at a compounding pharmacy located in Noblesville, Indiana, owned by Pharmakon Pharmaceuticals, Inc. She pleaded guilty on November 21 to the most of the charges in the Indictment (Indictment). She admitted to a statement of facts stating that she was aware of serious super-potency of drugs including morphine sulfate and midazolam, although she told FDA investigators she was not aware, prior to reports to FDA about superpotency in later lots (Plea Agreement). According to the Indictment against her and pharmacy owner Paul Elmer, sterile drugs compounded at the pharmacy were distributed to hospitals, including a hospital where the drugs were used in a neonatal intensive care unit, and caused serious distress to at least one patient. Ms. Bearden’s sentencing is not yet scheduled. Mr. Elmer is scheduled to go to trial on April 16, 2018.

So why the obscure reference to a frequent saying by a minor character in the Bullwinkle and Rockie cartoon series (a reference probably lost on any readers under the age of 60)? Because years ago, in Tampa, Florida, our firm represented a drug manufacturing company named Pharmakon. The U.S. Food and Drug Administration (FDA) and the Department of Justice demanded that Pharmakon, and its owner Abelardo Acebo, sign a “Consent Decree” which included, characteristically, a grant of broad shutdown powers to FDA. If they refused to sign, FDA would file a lawsuit. Like very few other companies, Pharmakon refused the Consent Decree, and faced an injunction action brought in federal court. The government failed to win a Preliminary Injunction against Pharmakon, and the presiding judge appointed as a special master the expert who had testified on behalf off Pharmakon at the Preliminary Injunction hearing, to monitor Pharmakon and file regular reports with the Court. He did so. But about three years later, the final hearing on the injunction request was held, the circumstances had changed, and the judge ruled against Pharmakon, forcing it to shut down.

No connection is known to exist between the two Pharmakons, except in the synapses of this blogger.