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SoCal Pharma Firm Whacked for $2 Million

SAN DIEGO (CN) - San Diego-based Ansun Biopharma will pay $2.1 million to settle civil and criminal complaints about submitting false claims on federal grants and a contract.

Ansun Biopharma, formerly known as NexBio, received two grants and a $50 million federal contract to try to develop an antiviral drug to treat influenza, the U.S. Attorney's Office said Wednesday.

Ansun's former CEO ordered its vice president to fabricate timesheets to milk the contracts from the National Institutes of Health and the $50 million NIH contract, the U.S. attorney said in a statement.

The U.S. attorney said the former CEO wanted the funding available on the NIH grants extended "for as long as possible because he needed access to the money from the grants to manage cash flow problems at the company."

Under a criminal information filed Wednesday, Ansun agreed to repay the NIH $1.65 million, and to pay the United States $495,000 to settle civil allegations of false claims.

The Ansun vice president, 49, of San Diego, pleaded guilty to defrauding the United States, a charge that was dismissed after he complied with terms of a deferred prosecution agreement.

The Ansun CEO, 58, of Rancho Santa Fe, pleaded guilty to interfering with federal officers and was sentenced to one year of probation, in August 2014.

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