Federal Prosecutors Target Marketers of Drug-Tainted Dietary Supplements

The 2010 prosecution against Shengyang Zhou, a Chinese national who is behind bars in Texas for trafficking and attempting to traffic in counterfeit versions of a medication, symbolizes a trend that has undermined confidence in FDA-regulated products including dietary supplements. Criminals continue to profit off the sale of fraudulent pills and powders that are laced with undeclared drugs.

In Zhou’s case, federal authorities referenced a series of FDA alerts concerning counterfeit drugs and tainted weight-loss pills. Although a number of pills believed to have been imported from China were being marketed as dietary supplements and nutritional products, regulators determined the pills contained undeclared pharmaceutical ingredients including Sibutramine.

FDA later warned the public about counterfeit versions of the brand name drug Alli. The fraudulent drug contained dangerous amounts of Sibutramine, which can cause a heart attack, stroke, seizures and other adverse health effects, the agency cautioned. Zhou identified himself as the manufacturer of the counterfeit drug, according to prosecutors.

The Denver federal judge who sentenced Zhou to 87 months in prison also ordered him to pay more than US$500,000 in restitution to victims, including an emergency room doctor who suffered a mild stroke after ingesting the counterfeit medication.

Zhou, who will be deported to China after he completes his sentence, is among a growing number of individuals who have been jailed for the importation, distribution or sale of products that contain either counterfeit drugs or are falsely marketed as dietary supplements. Consider the following cases involving “dietary supplements" that were laced with pharmaceuticals.

•             In 2014, Kamran Rezapour of Creston, North Carolina pleaded guilty to defrauding customers of nearly $5 million by selling erectile dysfunction (ED) drugs as “all natural" herbal supplements. Rezapour, the owner of Nutrition for Health Inc. and Mojo Risen LLC, was sentenced to 108 months in prison.

•             In May, the U.S. Department of Justice (DOJ or Justice Department) announced New Orleans resident Joseph De Melo was sentenced to 15 months in prison for distributing anabolic steroids and intentionally misbranding a dietary supplement that contained ED drugs. De Melo owned Rezultz Distribution LLC, a supplement retail store located in Carrollton, Texas, and he used the business to sell purported dietary supplements across the United States, prosecutors said.

•             More recently, Cheryl Floyd of Harrisburg, Pennsylvania was sentenced to 30 months in prison after she was charged with introducing misbranded drugs into interstate commerce and money laundering. Floyd Nutrition LLC marketed all-natural dietary supplements under such as names as Slim Trim U, ZXT Slim Bee Pollen and Magic Slim. Prosecutors said the products contained undeclared drugs including Sibutramine and Phenolphphthalein.

Others accused of similar mischief await their fate. Darlene Krueger of Destrehan, Louisiana is scheduled to go to trial in March 2016 after she was charged with conspiring to distribute and possess with the intent to distribute Sibutramine. A co-defendant, John Wesley Hoag of Fort Lauderdale, Florida, admitted to unlawfully importing diet pills from manufacturers in China and doling them out to his distributors, including Krueger, prosecutors said.

A federal grand jury indictment alleged the two conspired to sell “all-natural" dietary supplements when they knew the products contained Sibutramine. Krueger “pled not guilty, is not guilty, and the trial date cannot get here fast enough," said Krueger’s criminal defense lawyer, Marci Blaize, in an email to INSIDER.

Federal authorities have brought criminal cases against distributors of fraudulent dietary supplements as part of a multi-pronged approach to addressing the problem. In a Sept. 9 letter to Sens. Martin Heinrich (D-New Mexico) and Orrin Hatch (R-Utah), a Justice Department official cited problems of dietary supplements containing active pharmaceutical ingredients (APIs).

“Falsely marketing and advertising dietary supplements as all-natural products when they are tainted with active pharmaceutical ingredients or contain synthetic ingredients puts lives at risk," Justice Department spokeswoman Nicole Navas said in an emailed statement. “The Department of Justice and its partners will be vigilant when it comes to the health and safety of the American public."

During a Nov. 17 press conference, the DOJ announced a yearlong sweep produced civil and criminal cases against more than 100 makers and marketers of dietary supplements. “We are hoping the more the media reports on these actions and raises public awareness, it will assist in bringing change to the industry and preventing entities and individuals from violating the law in the future," Navas said.

Steve Mister, president and CEO of the Council for Responsible Nutrition (CRN), said in a phone interview that the government should take “swift and severe" action if it has evidence that products contain undisclosed pharmaceutical ingredients.

“We applaud the actions that we are seeing from DOJ and FDA and the other partners at the other agencies," said Mister, although he expressed support for more and “swifter" actions “to send a deterrent message."

Bringing criminals to justice can prove challenging, especially if they are living outside the United States. In a prosecution against four defendants who were charged with marketing as “all-natural" versions of sexual enhancement drugs, two of the men are still fugitives and believed to be in Dubai and the Philippines, a DOJ spokeswoman said last year via email. In a separate case, a prosecution against an individual who was linked to the importation of ephedrine has been administratively closed. The whereabouts of the defendant, Mashesh Kumar Bisht, are unknown, according to court records.

FDA Identifies Hundreds of Tainted Products

The criminal cases are symbolic of an epidemic that has undermined confidence in the safety of dietary supplements. To date, FDA has identified 700 fraudulent products in a database that was launched in 2007. Many of the products are labeled as dietary supplements for weight loss, bodybuilding and sexual enhancement.

FDA is on the front lines in the fight to remove tainted supplements from the market. “We’re devoting a lot of resources to this problem," said Gary Coody, FDA’s former national health fraud coordinator, in a phone interview.

“Of course, we start with the intent of getting the product off the market and addressing the immediate safety concern," Coody explained. “That means finding the seller, which at times can be difficult, getting them to stop selling the product, and we hope to get them to achieve a voluntary recall and to get them to voluntarily destroy the product."

Over the past five years, Coody pointed out, tainted products have comprised more than 40 percent of Class I recalls. FDA defines such a recall as “a situation in which there is a reasonable probability that the use of or exposure to a violative product will cause serious adverse health consequences or death."

“A lot of [the] successes we have are voluntary actions by the companies," Coody said. “We generally do not have mandatory recall authority over these particular products. Not everyone chooses to recall, and that’s very troubling."

Equally as troubling: dosages found in drug-laced supplements and counterfeit drugs often surpass quantities that are contained in lawful pharmaceuticals. For instance, FDA has identified levels of Sibutramine that exceeded by a factor of 10 the amount that was permitted in the drug before it was removed from the U.S. market, noted Coody, who retired from FDA earlier this month.

Even when FDA issues an alert, regulators can’t be certain the announcement is having the intended effect. For instance, a Colorado resident who was investigated by federal authorities admitted he continued to purchase drug-laced products from Zhou “after learning about the FDA warnings and corresponding with Mr. Zhou about the alerts," according to a 2013 federal appeals court decision affirming Zhou’s sentence. The Colorado resident, identified as “J.K.", told agents he operated an Internet-based business that sold the purported weight-loss products to consumers.

Criminals in this arena can be persistent, even after regulators flag fraudulent products.

“We can go after a seller and in … a few days, they can have a whole new product line and brand of product we have got to test again," said Coody, who explained the villains may have little more than a website and the ability to order products. “If they replace the products we found were tainted with another group of products, we start over … trying to test those."

While Coody recognized FDA can’t test every product on the market, the agency employs various methods to identify tainted supplements. FDA buys products online, responds to insider information, and conducts surveillance through its MedWatch adverse event reporting program.

But FDA may be only scratching the surface in flagging the number of tainted products on the market. Many of the products are sold online. And in 2010 testimony before the U.S. Senate’s Special Committee on Aging, an FDA official observed it can be difficult to detect some of the chemicals.

“We believe that’s a small fraction of what’s out there," Coody said, referencing FDA’s database of fraudulent products. “That represents a very small number of the actual products that are being marketed to consumers. It’s a big problem, and we think it potentially poses serious risks to consumers."