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Schering-Plough Criminal Investigation May Center On Puerto Rico

U.S. Attorney’s Office in New Jersey joins the probe


June 27, 2002
Copyright © 2002 CARIBBEAN BUSINESS. All Rights Reserved.

The U.S. Food and Drug Administration’s (FDA) criminal investigation of Schering-Plough seems to be centered on products manufactured in Puerto Rico, company spokesman Robert Consalvo to CARIBBEAN BUSINESS.

Schering-Plough’s regulatory and legal problems keep growing. It was recently revealed that the U.S. Attorney’s Office of New Jersey is now involved in the criminal investigation announced by Schering-Plough on May 20. The company’s headquarters are in Kenilworth, New Jersey.

"[Schering-Plough] now understands that the previously disclosed investigation by the U.S. Food and Drug Administration’s Office of Criminal Investigations in Puerto Rico is being handled by the U.S. Attorney’s Office in New Jersey, and it involves certain products manufactured in Puerto Rico," read a statement made the company on June 19.

Consalvo said the company had no additional information regarding the investigation and is awaiting formal notice from the U.S. Attorney. "Schering-Plough is complying with the consent decree executed on May 20 and has already paid the first $250 million, as stipulated," said Consalvo.

When asked about the class-action suit in 2000 that alleged Schering-Plough’s Proventil and Warrick brands of albuterol inhalers and their refills did not contain the active ingredient (that relieves symptoms of an asthma attack), Consalvo said he did not see a link with the present FDA or U.S. Attorney’s investigation, since these products are manufactured in New Jersey.

As part of the May 20 consent decree, the company must retain expert consultants to prepare detailed written reports about the adequacy of management controls at its manufacturing and laboratory operations in Puerto Rico and New Jersey.

CARIBBEAN BUSINESS sources confirmed that Philadelphia-based validation consultant Day & Zimmerman has been working with Schering-Plough since last year, making sure all systems are compliant with the FDA’s good manufacturing practices. The company starting validation operations in Schering-Plough’s Las Piedras plant and will soon begin working at the company’s Manati facility.

Day & Zimmerman is a 100-year-old, Top 500 global provider of diversified professional, technical, and personnel services in the engineering and construction, technical staffing, munitions production disposal, facilities management, and security services sectors. Among its clients are AstraZeneca/IPR Pharmaceutical Inc., Merck & Co., Ayers Wyeth, Abbott Laboratories Inc., Schering-Plough Inc., Pfizer & Co., and Cardinal Health.

Despite these difficulties, Schering-Plough’s first quarter (1Q) sales reached $2.5 billion, an 8.7% increase compared with $2.3 billion in 1Q 2001. Net income increased 6.4% to $600 million, or $0.41 diluted earnings per share, in 1Q 2002, compared with $564 million, or $0.38 diluted earnings per share, in 1Q 2001. Despite the negative allegations regarding Proventil, 1Q 2002 sales of the product grew 47.5% to $59 million, compared with $40 million a year earlier.

This Caribbean Business article appears courtesy of Casiano Communications.
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