BALTIMORE, OCT. 26 -- Federal prosecutors have accused Bolar Pharmaceutical Co. of fraudulently obtaining government approval to market its lucrative generic version of the hypertension drug Dyazide by secretly substituting the brand-name drug for the generic in tests.
Spelling out details for the first time in the long-brewing case, prosecutors alleged that executives of Bolar, based in Copiague, N.Y., orchestrated a scheme to substitute the brand-name product for their cheaper, copycat version in government tests, then ordered employees to erase computer tapes, hide notebooks, backdate records and lie to outside investigators. Samples of Bolar's version of the drug had failed the tests, according to court papers.
Sales of Bolar's version of Dyazide totaled $142 million between August 1987 and January of this year. It was withdrawn from the market in January at the Food and Drug Administration's request, amid charges of fraud during safety testing. It is unknown whether any of the 500,000 people who took the drug for high blood pressure were harmed.
The drug substitution allegation "represents only the tip of the iceberg" in the ongoing investigation of Bolar and other generic drug companies, said Breckinridge L. Willcox, the U.S. attorney for Maryland.
His comments came as Gena R. Finelli, 47, former director of Bolar's research laboratory, pleaded guilty Thursday in federal court here to obstructing the government probe. Willcox said the company falsified documents on additional drugs and more charges are expected.
Bolar officials declined to comment today. When allegations of irregularities surfaced almost two years ago, Bolar blamed possible inaccuracies in its reports to the FDA on clerical errors.
Later, Bolar attorneys said some apparent falsehoods had been discovered during an internal investigation, but did not acknowledge the alleged product substitution.
Bolar's hypertension drug, called Triamterene/Hydrochlorothiazide, sold for about half the price of Dyazide, manufactured by SmithKline Beecham. At one point, it was the largest-selling prescription generic drug in the country. SmithKline shareholders have filed a multimillion-dollar lawsuit against Bolar, contending it fraudulently cut into SmithKline's market.
Bolar and several other manufacturers in the hotly competitive generic drug field have come under parallel criminal and congressional investigations for alleged fraud and corruption. The FDA's generic drug division also is under investigation.
In addition to a probe by the House Energy and Commerce subcommittee on oversight and investigations, federal prosecutors working with agents of the inspector general's office of the Department of Health and Human Services have obtained convictions against 10 drug companies, executives and consultants on charges ranging from racketeering to giving FDA chemists thousands of dollars in illegal gratuities. Four FDA employees have been convicted of receiving the gratuities, and the former head of the FDA's generic drug division is on trial here on perjury charges.
Finelli, of Huntington, N.Y., is the only Bolar official charged so far and is now cooperating with investigators, prosecutors said. In a statement of facts filed in the Finelli case, 1st Assistant U.S. Attorney Gary P. Jordan said Finelli and others participated in the Dyazide substitution scheme and were ordered by unidentified superiors to throw investigators off the track by hiding, destroying or falsifying records.
In early 1987, according to Jordan, Bolar employees filled Bolar capsules with SmithKline's Dyazide powder and submitted them to an independent laboratory to be tested for bioequivalence, or therapeutic similarity, to Dyazide, a finding necessary to FDA approval. Bolar also submitted a sample batch of its own version of the drug.
Only the batch containing Dyazide passed the bioequivalency test, Jordan said, and Bolar sent the results for that batch to the FDA.
An FDA employee spotted a discrepancy in batch numbers, triggering an investigation. Jordan said Bolar executives then moved to hide evidence of the product substitution.
Finelli's attorneys said in a statement after her guilty plea that she was "more a victim than a participant in any wrongdoing at Bolar."