Online pharmacy Canada Drugs ordered to pay $34-million fine for illegal imports in U.S.
Canada Drugs has filled millions of prescriptions by offering itself as a safe alternative for patients to save money on expensive drugs. But U.S. prosecutors say the company's business model is based entirely on illegally importing unapproved and misbranded drugs not just from Canada, but from all over the world.
By Matt VolzThe Associated Press
Fri., April 13, 2018timer2 min. read
HELENA, Mont.—A Montana judge has sentenced a Canadian online pharmacy to pay $34 million for importing counterfeit and unapproved drugs into the U.S., a sentence that one advocacy group called too light for such a heinous crime.
U.S. District Judge Dana Christensen on Friday accepted plea agreements with Canada Drugs and its founder, Kris Thorkelson.
The company pleaded guilty to introducing misbranded drugs into interstate commerce, and two subsidiary companies pleaded guilty to selling counterfeit drugs.
Thorkelson pleaded guilty to knowing about and concealing a felony crime.
Prosecutors say the company has made at least $78 million since 2001 by importing mislabeled and unapproved drugs. That includes two counterfeit cancer drugs that had no active ingredients.
Canada Drugs was also sentenced to five years' probation and ordered to stop selling unapproved, misbranded and counterfeit drugs.
Thorkelson received five years' probation with six months' house arrest. He also must pay a $250,000 fine.
Canada Drugs has filled millions of prescriptions by offering itself as a safe alternative for patients to save money on expensive drugs, and its founder, Thorkelson, has been hailed as an industry pioneer for starting the company in 2001.
But U.S. prosecutors say Canada Drugs' business model is based entirely on illegally importing unapproved and misbranded drugs not just from Canada, but from all over the world. The company has made at least $78 million through illegal imports, including two that were counterfeit versions of the cancer drugs Avastin and Altuzan that had no active ingredient, prosecutors said.
After more than two years of struggling to get the international company to appear in U.S. court to face the felony charges, Canada Drugs and Thorkelson, struck a plea deal with prosecutors late last year.
"Counterfeiting oncology medications is a nearly untraceable and heinous health care crime," Shabbir Imber Safdar, executive director of the Partnership for Safe Medicines, wrote in a letter to the judge. "You put saline in a bottle, and when the cancer patient takes it, there is no evidence in the patient of the crime."
Safdar said Thorkelson should receive prison time and that Thorkelson's and Canada Drugs' pharmacy licenses should be surrendered. The group also wants Canada Drugs to give up all of it internet domain names, including ones not named in the plea deal, to prevent the company from continuing to sell misbranded and counterfeit medicine.
"We feel that being a part of a scheme to sell Americans fake cancer drugs while you profit from it should be sufficient grounds for a long-term revocation of a pharmacist's license," Safdar wrote.
Neither Safdar nor two of Canada Drugs' and Thorkelson's attorneys returned messages seeking comment Thursday.
Federal prosecutors wrote in court documents that the recommended sentence is appropriate.
"The United States believes that the above-referenced sentence in an appropriate one reflecting the seriousness of Thorkelson's conduct, the need for just punishment and adequate deterrence to future criminal conduct," Assistant U.S. Attorney Chad Spraker and Special Assistant U.S. Attorney Paul Joseph wrote.