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Former FDA Official Pleads Guilty in Generic Drug Scandal

April 1, 1990 GMT

BALTIMORE (AP) _ A former U.S. Food and Drug Administration official pleaded guilty to accepting a $20,000 bribe to expedite a generic drug maker’s application in a scandal that has snared several other FDA employees.

Jan T. Sturm, 35, of Columbia, Md., pleaded guilty in U.S. District Court on Friday to accepting the bribe from Raju Vegesna, former president of American Therapeutics Inc. in Bohemia, N.Y., prosecutors said.

Sturm, a former consumer safety officer in the FDA’s generic drug division, pleaded guilty to involvement in unlawful gratuities, U.S. Attorney Breckinridge Willcox said in a statement.

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Sturm faces a maximum penalty of two years in prison and a $250,000 fine, Willcox said. He is to be sentenced June 12.

The former FDA official accepted the $20,000 to buy a new car in exchange for expediting Vegesna’s application to produce generic drugs, Willcox said.

American Therapeutics pleaded guilty Friday to one count of using interstate facilities in aid of racketeering. The company faces a maximum fine of $500,000, Willcox said.

Sturm, American Therapeutics, Vegesna and former drug consultant Mohammed Azeem were charged March 2 in a bribery scandal dating to 1988 that also involves Charles Y. Chang, former branch chief of the generic drug division.

Azeem pleaded guilty March 16 to interstate travel in aid of racketeering and offering an illegal gratuity. Vegesna has not yet entered a plea.

American Therapeutics, Vegesna and Azeem allegedly provided Chang with a trip to Hong Kong, Thailand, and London in 1987; furniture; cash and a computer in return for his favor on generic drug applications, Willcox said.

The generic drug division approves applications of pharmaceutical companies that seek to market generic drugs, which are less expensive equivalents to brand-name drugs.

Sturm was responsible for tracking the progress of drug applications submitted by pharmaceutical companies.

Chang pleaded guilty in May 1989 to two counts of interstate travel in aid of racketeering.

Last October, he was fined $10,000 and ordered to spend a year in a federal work-release program and to perform 1,000 hours of community service.

Since the investigation began in 1988, three former FDA employees, including Chang but not Sturm; three generic drug company executives; and two generic drug companies in addition to American therapeutics have been convicted.