A Tale of Smuggled Prescription Drugs

HUNTSVILLE, Ala. (CN) - The owner of AQ Pharmaceuticals claims his compliance officer bought "illegally diverted" Lipitor and Celebrex, which had been smuggled into the United States, and sold the drugs to AQ, causing the company to resell them, unknowingly, to a network of independent pharmacies. Both men - plaintiff and defendant - faced felony conspiracy charges for the ruse, according to the federal complaint.

Trang Nguyen, owner of AQ Pharmaceuticals, sued his former compliance officer, James Floyd, and Floyd's companies, Pharmaceutical Medical Supply and Direct Pharmaceutical. Trang also sued Roderic Steakley, who allegedly has or had a stake in Floyd's companies.

Trang claims he "submitted purchase orders to defendants for lawful and compliant supply of Lipitor and Celebrex, for the purpose of lawful resale in the United States," and the defendants sent him "diverted Lipitor tablets and Celebrex capsules manufactured by Pfizer that were not intended or approved for sale in the United States due to its illegal importation and smuggling into the United States."

Trang claims that Floyd "misrepresented the status of the Lipitor and Celebrex as legal for sale in the United States, despite his duty and responsibility as a compliance officer of AQP." Trang claims he had "no knowledge of the illegal nature of the diverted" drugs.

He claims that Floyd and Stanley then made "false oral and written representation to True Care Pharmacy regarding the ownership of AQP" to facilitate the sale of the diverted drugs. True Care is a network of independent pharmacies, which bought "quantities" of the diverted drugs.

As a result of all this, Trang says, he, Floyd and others were indicted on federal charges of felony conspiracy to defraud the United States, in 2007 in the Western District of Missouri. He claims that James told him throughout that the charges were "erroneous," but pleaded guilty in 2008 and was sentenced in March 2009.

Trang claims he and AQ were ignorant of the nature of the diversion until after Floyd was sentenced. He says felony charges against him were dismissed, but he had to plead guilty to misdemeanor misbranding, and had to pay $597,420 in restitution to Pfizer. The litigation cost him more than $1 million.

Trang seeks punitive damages for fraud, conspiracy and negligence. He is represented by Roger Bates.

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.

Email *

Submit