September 20, 2006
Contact: DEA Special Agent Ruth Porter-Whipple
Hi-Tech Pharmaceuticals & 11 Individuals Indicted for "Generic" Pill
Defendants Allegedly Sold Millions Of Pills Over
Allegedly Sold Millions Of Pills Over The Internet
of the vehicles seized by the DEA as part of the operation
ATLANTA – Eleven
individuals and an Atlanta-based company have been indicted by a federal
grand jury on multiple felony charges relating to a scheme to sell
adulterated and unapproved new drugs over the internet. Four of the
defendants were scheduled to appear at a bond hearing before United
States Magistrate Linda Walker at 1:45 p.m. today.
In a news conference, DEA Special Agent In Charge Sherri Strange
of the fastest growing drug abuse concerns is prescription drugs. The
selling and purchasing of drugs have been facilitated by the wide use
of the internet, the anonymity it provides, and the ease and relative
secrecy of the mail and private delivery companies. A recent search engine
query for ‘prescription drugs for sale online’ resulted
in over 10 million hits. President Bush, Attorney General Gonzales,
DEA Administrator Tandy have made prescription drug abuse a priority
for DEA. As our children sit down at the family computer to do their
schoolwork, research projects, and converse with friends, criminal
organizations like the one alleged today slither into their lives.
Every one of us
has received spam e-mails directing us to visit websites to order supposed
generic prescription drugs and controlled substances. Buyers beware.
I am proud that DEA works closely with the FDA, other federal agencies,
and foreign counterparts to thwart such criminal organizations.”
United States Attorney
David E. Nahmias said, “The indictment’s allegations are
disturbing because customers thought they were getting legitimate and
safe prescription drugs over the internet from Canada at cheaper prices,
when in reality they received adulterated fakes that were crudely made
in an unsanitary house in Belize.”
FDA Office of Criminal Investigations Special Agent In Charge David Bourne
said, “The FDA’s Office of Criminal Investigations actively
pursues those who deceive the public by manufacturing and selling unapproved
and unregulated medications which may pose risks to the health of consumers.
We are committed to investigating and preventing those who use trickery
and deceit to illegally and unscrupulously sell medications over the
internet at the expense of the public health."
The defendants named in the indictment are: JARED ROBERT WHEAT, 34, of
Alpharetta, Georgia; DAVID DALTON JOHNSON, 37, of Pinehurst, North Carolina;
DAVID ALAN BRADY, 40, of Pinehurst, North Carolina; STEPHEN DOUGLAS SMITH,
38, of Duluth, Georgia; THOMAS HOLDA, 43, of Duluth, Georgia; SERGIO
RONALDO OLIVEIRA, 46, of Hoschton, Georgia; BRAD NEAL WATKINS, 38, of
Birmingham, Alabama; DAVID WATKINS, 40, of Norcross, Georgia; STEVEN
BLINDER, 42, of Aberdeen, South Dakota; MICHELLE YOUNG, 38, a citizen
of Belize; and, GUILLERMO PECH, 28, also a citizen of Belize; and HI-TECH
PHARMACEUTICALS, a company based in Norcross, Georgia.
All of the defendants
are charged with two different conspiracies: (1) conspiring to import
controlled substances into the United States; and (2) conspiring to
violate the wire and mail fraud statute and to introduce into interstate
commerce adulterated and misbranded prescription drugs. The indictment
charges each of the defendants, except DAVID WATKINS, BRAD WATKINS
and STEVEN BLINDER, with different substantive violations including
mail fraud, distribution of controlled substances and introducing adulterated
and misbranded new drugs. The indictment also charges the lead defendant,
JARED WHEAT, with engaging in a continuing criminal enterprise. The
indictment seeks to forfeit numerous properties, automobiles and bank
accounts, and seeks a money judgment of not less than $19.8 million.
According to United States Attorney Nahmias, the indictment, search warrants
and other information presented in court: WHEAT, the principal owner
of Hi-Tech Pharmaceuticals, and the other defendants opened a drug manufacturing
facility in Belize in approximately 2002. The defendants allegedly used
Hi-Tech funds and JARED WHEAT’s own funds to cover the costs of
operating the Hi-Tech facility in Belize and would travel to Belize to
manufacture various prescription and controlled substances. The defendants
allegedly made approximately 24 different drugs that they marketed through
so-called “spam” advertisements over the internet as authentic
generic versions of those drugs being imported from Canada. The drugs
included steroids such as “Oxymethelone” and “Stanazolol,” along
with unapproved versions of controlled drugs such as “Ambien,” “Valium,” and “Xanax.” The
defendants also manufactured versions of prescription drugs such as “Viagra,” “Cialis,” “Lipitor” and “Vioxx.” From
2002 through 2004, the defendants allegedly ordered enough active ingredients
to manufacture millions of pills, many of which were then shipped into
the United States to individuals who purchased the drugs after receiving
internet “spam” and also to various wholesalers of drugs.
of the public are reminded that the indictment only contains charges.
The defendants are presumed innocent of the charges and it will be
the government's burden to prove each defendant's guilt beyond a reasonable
doubt at trial.
The U.S. Attorney's Office in Atlanta recommends parents and children
learn about the dangers of drugs at the following web site: www.justthinktwice.com.
This case is being investigated by Special Agents of the DEA and the
Food and Drug Administration, Office of Criminal Investigations, with
the Henry County Police Department. Valuable assistance has been provided
by the Bureau of Alcohol, Tobacco and Firearms (ATF), the Customs and
Border Protection Foreign Mail Facility in Miami, the Postal Inspection
Service, Doraville Police Department, Roswell Police Department, City
of Atlanta Police Department, Spalding County Sheriff's Office, Cobb
County Sheriff's Office, Clarkston Police Department, East Point Police
Department and the Duluth Police Department.
Assistant United States Attorneys Aaron M. Danzig, Randy S. Chartash
and J. Russell Phillips are prosecuting the case.
For further information please contact David E. Nahmias (pronounced NAH-me-us),
United States Attorney, or Charysse L. Alexander, Executive Assistant
United States Attorney, through Patrick Crosby, Public Affairs Officer,
U.S. Attorney's Office, at (404) 581-6016. The Internet address for the
HomePage for the U.S. Attorney's Office for the Northern District of
Georgia is www.usdoj.gov/usao/gan.