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April 13, 2018: Canadian Drug Firm Admits Selling Counterfeit and Misbranded Prescription Drugs Throughout the United States


OCI Small Clear Seal 

 

Food & Drug Administration 
Office of Criminal Investigations

 

Missoula — Kristjan Thorkelson, a resident of Manitoba, Canada, together with several Canadian companies associated with Thorkelson, including Canada Drugs, Rockley Ventures, & River East Supplies, admitted today to widespread illegal sales of misbranded & counterfeit prescription drugs in the United States. Chief U.S. District Court Judge Dana Christensen sentenced the Canadian companies to forfeit $29,000,000 of the proceeds of their illegal scheme, to pay a fine of $5,000,000, & to five years of probation. The court sentenced Thorkelson individually to pay a fine of $250,000 and to five years of probation with the first six months in home confinement. Thorkelson & the associated companies were also ordered to permanently cease their illegal operations, surrender to the United States all domain names & websites from their businesses, and cooperate with the United States Justice Department & the Food & Drug Administration (FDA) in any further criminal investigations. 

In 2010, it came to the attention of the FDA that Canada Drugs was shipping to health care providers in the United States prescription drugs that were unapproved in the United States, labelled with foreign languages, and that lacked adequate instructions for use.  During this time, Thorkelson was CEO of Canada Drugs. Further investigation revealed that various entities affiliated with Canada Drugs were smuggling unapproved & misbranded drugs intended for sale in foreign countries into the United States, including for sale to providers in Montana. To facilitate its sales, Canada Drugs purchased other companies engaged in this business and used the brand names, drug inventories, and customer lists of those companies to further its illegal operations. One of those companies was Montana HealthCare Solutions, owned by Montana resident Paul Bottomley, who was separately prosecuted for similar conduct. In order to avoid detection, Canada Drugs & its affiliated companies falsified customs forms concerning the value of the drugs shipped into the United States. 

 

In two instances, Canada Drugs, through its subsidiary River East Supplies, distributed counterfeit cancer drugs Avastin & Altuzan (the Turkish version of the drug) in the United States. Testing of vials of the drugs recovered from these shipments revealed that both contained no active ingredient. In 2012, Thorkelson & other people at Canada Drugs became aware that they had shipped counterfeit Avastin & Altuzan to medical clinics in the United States. Thorkelson denied “selling or offering Avastin,” even while the company attempted to recall the suspect drugs. At no time did Thorkelson notify the FDA or other authorities in the United States that counterfeit cancer drugs containing no active ingredient had been shipped to providers in the United States. 

United States Attorney Kurt Alme stated, “By circumventing the FDA approval process, Thorkelson and the Canada Drugs companies jeopardized the health and safety of Americans. The FDA approval process is important for the protection of public health & safety, and we will diligently prosecute those who put unknown & unapproved substances into the American prescription drug market. But as this case shows, American providers & consumers need to beware when purchasing drugs on the internet.”

 

“FDA regulations are in place to protect patients & help ensure the medicines they receive are safe and effective,” said Catherine A. Hermsen, acting director of the FDA’s Office of Criminal Investigations. “The U.S. drug supply is among the safest in the worldwide, but when drugs from outside the FDA’s closed supply chain enter the U.S., patients are put at risk. For the protection of consumers, the FDA will continue to pursue & bring to justice those who attempt to evade FDA’s regulations.” 

 

The case was prosecuted by Assistant U.S. Attorney Chad Spraker & Special Assistant United States Attorney Paul Joseph, & investigated by the U.S. FDA Office of Criminal Investigations. The Criminal Division’s Office of International Affairs also provided significant assistance in this matter. The Dept. also thanks its law enforcement colleagues in Canada, the United Kingdom, & Barbados.

 

Topic(s): 

Prescription Drugs

 

Component(s): 

Criminal Division

USAO – Montana

 

Contact: 

KERI LEGGETT Acting Public Information Officer (406) 761-7715

 

 

 

 

 

Updated: April 19, 2018 — 5:38 pm

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