United States of America v. Cadden

Barry Cadden, pharmacist, co-owner, and director of New England Compounding Center (“NECC”) and countless others from NECC have been indicted and charged with 25 counts of second degree murder in seven states. [1]  NECC is alleged to have used contaminated vials and expired ingredients when producing drug injections later sent to hospitals and pain clinics. [2]  Authorities have reported this is the largest criminal case to date in the United States involving contaminated medicine. [3] 

NECC, a Massachusetts corporation, licensed as a pharmacy, was located in Framingham, Massachusetts from 1998 until October 2012. [4]  The purpose of NECC was to prepare, mix, assemble, package, and label drugs pursuant to specific prescriptions sent to NECC from medical professionals. [5]  In connection with NECC, Medical Sales Management (“MSM”), owned by Cadden, was used to provide administrative and sales services to NECC. [6]  To safely operate a compounding facility the pharmacists must prepare all drugs in a controlled environment with low levels of environmental contamination; in this case, fourteen employees at NECC and MSM have been charged with second degree murder for preparing and shipping non-sterile drugs. [7]

The defendants have been charged with racketeering, mail fraud, racketeering conspiracy, conspiracy to defraud the United States, introduction of adulterated drugs into interstate commerce with the intent to defraud and mislead, introduction of misbranded drugs into interstate commerce with the intent to defraud and mislead, criminal contempt, conspiracy to commit structuring, and structuring. [8]  NECC’s primary business objective was to use non-sterile drug ingredients and assemble sterile drugs for production, and to ensure compliance with pharmaceutical regulations NECC was required to produce a quality assurance report each quarter. [9] 

The defendants altered the reports to list expired drugs with false expiration dates and continued this practice from 2008 through 2012. [10]  The glove fingertips of NECC personnel were tested in 2012 and it was revealed mold and bacteria were on the gloves of the defendants. [11]  After this finding Cadden was asked to investigate NECC laboratories and he did nothing to prevent the mold and the bacteria at NECC. [12]  The defendants profited from mislabeling the drugs as sterile and devised a scheme to make more money for the falsely labeled drugs. [13]  On repeated occasions patient prescriptions were filled and not tested before being shipped to customers across the country. [14] 

The indictment alleged approximately 6,200 mislabeled vials were sent to patients in just over five weeks. [15]  The contaminated vials were mailed to Michigan, Tennessee, Indiana, Maryland, Virginia, Florida, and North Carolina and as a result 64 people died and over 750 people fell ill from the tainted drug injections. [16]  The defendants were charged for second degree murder in all seven states because of the wanton and willful disregard of the likelihood of severe bodily injury or death resulting from their actions. [17]  In a specific instance, NECC eye block anesthetic was found to have failed during eye surgeries resulting in severe eye pain for patients. [18] 

To make more money defendants fraudulently created patient names and prescriptions, some of the patient names included, L.L. Bean, Filet O’fish, Harry Potter, and Coco Puff. [19]  It is estimated over the past three years Cadden pocketed over $62 million from the scheme. [20]  After the arrest and indictment, Cadden was released on a $500,000 bond and was placed under house arrest until the trial begins. [21]

The lawyers plan to argue the defendants did not act with malice when preparing and mailing the patient prescriptions, in hopes to negate the second degree murder charges. [22]  It will be difficult for the defendants to negate many of the charges because of the overt acts from the scheme, the deaths resulting from the contaminated medicine, and the failure of the defendants to report transactions in excess of $10,000.   The federal government will ask the defendants to forfeit all properties and interests, if convicted, in relation to crimes; specifying the defendants’ houses, cars, and luxury materials must be turned over to the government upon conviction. [23]

Hillary Cook is a current student at DePaul University College of Law in Chicago. Ms. Cook completed her undergraduate degree at the University of Dayton in communication management and political science. She will complete her law degree and certificate in health law in 2016. 

References :

[1] Available at, Evan Allen, NECC Pharmacist are Put Under House Arrest, The Boston Globe (Dec 17, 2014) http://www.bostonglobe.com/metro/2014/12/19/judge-set-release-conditions-for-pharmacy-officials-charged-sweeping-case/UnKl6f23cqfuC51CXFHCJM/story.html; Susan Walsh, Wrentham Resident among Arrestees for Meningitis Deaths Linked to New England Compound Center, The Sun Chronicle (Jan 7, 2015) http://www.thesunchronicle.com/news/local_news/wrentham-resident-among-arrestees-for-meningitis-deaths-linked-to-new/article_a7dd5040-85f1-11e4-ad4b-bb24c366ac59.html.

[2] Walsh, supra note 1.

[3] Id.

[4] United States v. Cadden, et. al., No. 14CR10363, page 2 (Dist. Mass. Dec. 16, 2014).

[5] Id.

[6] Id. at 1.

[7] Id. at 11-63.

[8] Id. at 11.

[9] Id.

[10] Id. at 12.

[11] Id. at 18.

[12] Id.

[13] Id. at 20.

[14] Id.

[15] Id. at 22.

[16] Id. at 22-25; Walsh, supra note 1.

[17] United States v. Cadden, et. al., No. 14CR10363, page 25.

[18] Id. at 47.

[19] Id. at 45.

[20] Allen, supra note 1.

 [21] Id; stating the Judge barred Cadden from working in the pharmaceutical industry, prohibited Cadden from drinking excessive amount of alcohol, and ordered Cadden to undergo drug testing, and warned Cadden could be ordered to attend substance abuse treatments in the future.

[22] Id.

[23] United States v. Cadden, et. al., No. 14CR10363, page 68.