Chinese company, CEO plead guilty to selling human growth hormone, to pay $7.5M

By Eric Tucker, AP
Wednesday, October 6, 2010

Chinese company, CEO plead guilty in HGH probe

PROVIDENCE, R.I. — A Chinese company thought to have once been responsible for most of the illegal human growth hormone smuggled from overseas into the United States pleaded guilty along with its CEO Wednesday to illegally selling the drug and agreed to pay $7.5 million.

Lei Jin and his company, GeneScience Pharmaceutical Co., entered the pleas through their lawyers in U.S. District Court in Providence. Jin, who did not attend the hearing, and GeneScience admitted illegally shipping and selling the muscle-building drug, under the brand name Jintropin, without the required approval from the Food and Drug Administration.

The company, based in Changchun, China, was charged in 2007 during a massive crackdown on illegal sports doping, dubbed Operation Raw Deal, in which more than 120 people were arrested and 11.4 million doses of drugs were seized.

Nearly 90 percent of the human growth hormone brought from overseas into the United States originates in China, and the vast majority of that was made by GeneScience, said Assistant U.S. Attorney Adi Goldstein. She said that the company’s illegal drug sales totaled roughly $7 million and that the company hid its actions by, among other things, failing to disclose the contents of the packages it was shipping.

Federal investigators in New England used wire transfers and e-mails from the company to track shipments and orders from across the world, including in Rhode Island, where the investigation was based.

“There’s no question that the good work done here has put a dent in HGH importation into the United States,” U.S. Attorney Peter Neronha said after the sentencing hearing.

As part of the plea agreement, the company and Jin will forfeit $4.5 million and set up a $3 million fund that will work against doping in sports by providing grants for education and scientific research. The fund will be administered by the Rhode Island Foundation. The money is on top of $2.7 million the company had earlier forfeited in the case.

Lawyers for Jin and the company did not make any statements on their clients’ behalf in court Wednesday, and had no comment prior to the hearing.

U.S. District Judge Mary Lisi praised prosecutors and defense lawyers for an agreement that she said would both deter the sale of performance-enhancing drugs and also guarantee money for anti-doping programs.

“The proposal that the court has accepted today is one that speaks loud and clear to any foreign company that tries to do what GeneScience and Mr. Jin did,” she said.

Jin was initially indicted on charges including money laundering and smuggling goods into the United States, but the plea agreement required him to admit only to a single misdemeanor count of introducing an unapproved drug into interstate commerce. He also received five years probation, and will not be able to sell other drugs to United States customers during that time without the approval of the Secretary of Health and Human Services.

The FDA closely regulates the use of human growth hormone, allowing it to be prescribed for certain medical conditions but not for anti-aging, bodybuilding or weight loss. In 2007, actor Sylvester Stallone was convicted in Australia of importing dozens of vials of Jintropin into the country while on a promotional tour. He later defended its use as a drug that kept his body in shape.

Federal investigators have stepped up efforts in recent years to target companies that distribute steroids and human growth hormone and have also raided compounding pharmacies suspected of illicitly supplying the drugs to professional athletes and others.

The case against GeneScience is connected to another case prosecuted in Rhode Island involving a New Jersey businessman, Daniel McGlone, who was convicted of recruiting doctors to write bogus prescriptions for bodybuilding customers they had never met.

Prosecutors believe some of the human growth hormone involved in that case came from GeneScience.

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