The New York Daily News’ T.J. Quinn and Michael O’Keefe continue their EPD reportage, this time exploring the seamy side of Norcross, GA’s Hi-Tech Pharmaceuticals.
According to an affidavit filed by prosecutors last month, Jared Wheat and his partners were willing to take drastic steps to protect their empire. In 2004, Wheat and partners Stephen D. Smith and Tomasz Holda discussed assassinating a Food and Drug Administration agent who had been investigating Hi-Tech, according to the affidavit. In the weeks before the grand jury issued its indictment, the feds say, Wheat and Smith talked about hiring a private eye to dig up dirt to blackmail assistant U.S. attorney Aaron Danzig. Neither alleged plot was carried out, but authorities did arrest Holda, a convicted steroids trafficker, after he purchased a firearms silencer. He later pleaded guilty to gun charges.
The September indictment claims that Wheat and his associates used Internet spam to advertise and sell what they claimed were low-cost, generic medicines from Canada. Instead, the government says they were making a fortune by selling drugs they mixed up in garbage cans in a filthy house far south of the border. “Consumers thought they were getting legitimate and safe prescription drugs over the Internet from Canada at cheaper prices,” said David Nahmias, the U.S. Attorney for northern Georgia. “In reality, they received adulterated fakes that were crudely made in an unsanitary house in Belize.”
Among the other allegations: – Hi-Tech employees spiked weight-loss products with ephedra to make them more effective and continued to do so even after the FDA banned its use in 2004 after it was linked to death of Baltimore Orioles’ pitcher Steve Bechler. Ephedra, a powerful herbal stimulant, had been linked to more than 150 deaths; – Hi-Tech employees spiked a product called Stamina RX, which it claimed was a natural supplement to treat erectile dysfunction, with the active ingredient in Viagra and Cialis; – Wheat and others sold and marketed a product known as “Verve” that contained GHB, the banned “date rape” drug linked to scores of deaths in recent years. Another ingredient was GBL, a cleaning product that converts into GHB when ingested. Wheat and his crew masked the taste with Kool-Aid, according to a search warrant affidavit filed by Special Agent Edward Smith of the Drug Enforcement Administration. The company later marketed the drink as a cleaning product to confuse investigators. – Hi-Tech employee Brad Watkins sold ecstasy; the DEA affidavit also claims thousands of fake ecstasy tablets were manufactured by Hi-Tech and sold on the streets of the United States – Wheat operated a marijuana trafficking ring during the 1990s that was shut down when he was arrested in Alabama.
Like Albany District Attorney David Soares’ ongoing Internet steroids investigation, the Hi-Tech case illustrates how the Web has erased national and state borders, posed new challenges for regulators and turned the supplement business into an ungovernable marketplace. The case also shows how the Dietary Supplement Health and Education Act of 1994 opened the door to a host of unsavory operators more interested in profits than consumer safety and regulatory compliance. The purpose of the law was to give Americans access to alternative treatments and medicines, to have greater control over their diets and health. But the excesses of DSHEA have created what many experts consider a Wild West frontier where anything goes and the criminal can often work under the cloak of legitimacy. Patrick Arnold, the chemist who developed the BALCO steroid THG and androstenedione, the steroid precursor later made famous as Mark McGwire’s favorite supplement, once attended an industry meeting in the office of U.S. Sen. Orrin Hatch (R-Utah), DSHEA’s co-sponsor.