Two Plead Guilty in Drug Scheme
Two Pinehurst men pleaded guilty in Atlanta Tuesday to charges stemming from an Internet drug fraud case.
The men were accused of taking part in a scheme to pass off generic prescription drugs manufactured in Belize and marketed through spam e-mails as drugs from Canada.
David A. Brady, 40, pleaded guilty to conspiracy to defraud individuals seeking prescription drugs and to introduce into interstate commerce unapproved new drugs and adulterated new drugs.
David D. Johnson, 38, pleaded guilty to misprision of a felony for concealing criminal activity.
The two were employees of an Atlanta company called Hi-Tech Pharmaceuticals of Norcross that the government says marketed generic versions of several different drugs, including Valium, Xanax, Viagra and Cialis.
Brady and Johnson are among 11 people in Georgia, North Carolina, South Dakota and Belize who were indicted in September. According to the investigation, the scheme netted more than $19 million. The lead defendant is Jared Robert Wheat, 34, of Alpharetta, Ga. He faces the additional charge of engaging in a continuing criminal enterprise.
The U.S. Attorney's Office said Brady and Johnson had cooperated with the investigation. Brady pleaded guilty after agreeing to the government's sentencing recommendation of five years in prison and forfeiture of $1.7 million.
The recommendation is nonbinding. Actual sentencing will be up to the judge at a May 8 hearing. Johnson may be facing a sentence of three years and a $250,000 fine.
The scheme targeted people hoping to obtain low-price drugs from Canada. The U.S. Attorney's Office said that some of the drugs manufactured had little or no medical value.
People would receive unsolicited e-mails directing them to one of several Web sites where they could order the drugs, which would then be shipped from where they were manufactured in Belize. The drugs were crudely made at an unsanitary house, U.S. Attorney David E. Nahmias said in September.
Moore County sheriff's deputies accompanied investigations from the Food and Drug Administration (FDA) and the Drug Enforcement Agency (DEA) to the men's Pinehurst homes Sept. 14.
Brady and Johnson worked for the company in marketing, sales and distribution.
Others charged are Stephen Douglas Smith, 38, of Duluth, Ga.; Thomas Holda, 43, of Duluth, Ga.; Sergio Ronaldo Oliveira, 46, of Hoschton, Ga.; Brad Neal Watkins, 38, of Birmingham, Ala.; David Watkins, 40, of Norcross, Ga.; Steven Blinder, 42, of Aberdeen, S.D.; Michelle Young, 38, of Belize; and Guillermo Pech, 28, of Belize.
The charges include conspiracy to import controlled substances into the United States, conspiracy to violate the wire and mail fraud statute and to introduce into interstate commerce adulterated and misbranded prescription drugs.
According to the U.S. Justice Department, Wheat opened the manufacturing facility in Belize in 2002. It made 24 different versions of prescription drugs, including the steroids Oxymethelone and Stanazolol, anti-depressants Ambien, Valium and Xanax, impotency drugs Viagra and Cialis, the cholesterol pill Lipitor and the arthritis pill Vioxx.
Matthew Moriarty can be reached at 693-2479 or by e-mail at firstname.lastname@example.org.
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