German drug firm to pay $50M in US purity case at India site

Business News

LAS VEGAS (AP) — An international pharmaceutical company has agreed to plead guilty in a U.S. court and pay $50 million for deleting and hiding manufacturing records in India during a federal Food and Drug Administration drug purity investigation.

Fresenius Kabi Oncology Ltd. “put vulnerable patients at risk,” Brian Boynton, acting assistant attorney general in the Justice Department civil division, said in a statement submitted Tuesday which announced the agreement to U.S. District Judge Jennifer Dorsey in Las Vegas. A plea date was not immediately set.

“By hiding and deleting manufacturing records, FKOL sought to obstruct the FDA’s regulatory authority and prevent the FDA from … ensuring the purity and potency of drugs intended for U.S. consumers,” Boynton said.

Fresenius Kabi is a subsidiary of Fresenius SE & Co. KGaA healthcare group based in Bad Homburg, Germany. It said in a statement that patient safety “was and has continued to be safeguarded at all times.”

It blamed former employees at a company plant in Kalyani, West Bengal, India, for failing to provide records during an FDA inspection that prosecutors said occurred in January 2013.

The plant makes cancer drugs distributed in the U.S., prosecutors said.

The employees were fired and the company informed the public in July 2013, Fresenius Kabi said, adding that resolving the misdemeanor criminal case would be “net income neutral.” Its parent company is publicly traded in Europe.

“While we are pleased to have reached this resolution, we regret that such events happened years ago in one of our plants,” Fresenius Kabi CEO Mats Henriksson said.

Court documents alleged that employees removed computers, documents and records ahead of the January 2013 FDA inspection, and deleted spreadsheets that contained evidence of manufacturing violations.

The company will pay a $30 million fine and forfeit another $20 million, prosecutors said. It also agreed to implement a compliance program to “prevent, detect and correct violations of U.S. law” relating to the manufacture of cancer drugs intended for terminally ill patients, they said.

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