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Executive Summary

FORMER FDA CHEMIST CHANG GETS ONE-YEAR WORK RELEASE, three years of probation and 1,000 hours of community service in an Oct. 3 sentence handed down by Baltimore federal court Judge Hargrove. Charged with two counts of interstate travel in aid of racketeering, Charles Chang was also fined $ 10,000 for his acceptance of illegal gratuities from generic drug manufacturers. Chang resigned his position as a supervisory chemist in late April, several weeks after the criminal informations were filed against him. The U.S. Attorney's Office in Baltimore had sought a jail term for Chang. Assistant U.S. Attorney Gary Jordon, the prosecuting attorney for the case, characterized Chang's illegal conduct as "clearly . . . more extensive" than any of his colleagues at FDA. However, Jordon noted that the former FDAer's illegal activities should be balanced against his cooperation in the case. Overall, Chang received almost $ 78,000 in illegal gratuities from generic companies: $ 23,000 in cash from former Quad CEO Dilip Shah; $ 2,900 from former Par Senior VP Ashok Patel; $ 2,000 from former Pharmaceutical Basics exec Raj Matkari; $ 25,000 "in various benefits" from American Therapeutics; and over $ 25,000 in additional gratuities from undisclosed parties. The source and/or sources of the undisclosed gratuities are expected to be revealed as additional information counts or indictments are filed. Jordan noted that Chang agreed to plead guilty and cooperate in the investigation within two weeks of the July 18, 1988 search of his home. His cooperative efforts included taping a conversation with Matkari in which Chang got the PBI exec to make "certain admissions" relating to the $ 2,000 he gave the FDAer. Chang also engaged in a number of taped "undercover conversations" with Shah. Chang's defense attorney noted that at one point during the taped conversations Shah offered to send Chang's son to college. Chang also visited Shah in Indianapolis wearing a hidden microphone and attempted to get the exec to admit to giving illegal gifts. Shah reportedly discovered that Chang was wearing a wire while driving him back to the airport. Highlighting the extent of Chang's cooperation, the defense attorney noted that the FDAer became "panic stricken" when he lost sight of the agents that were following them and leapt out of the car while it was still moving. The defense attorney also asked the court to consider Chang's poor health and the personal circumstances that led to his acceptance of gifts. The lawyer noted that Chang's wife had left him roughly four years ago and that accepting illegal gratuities was Chang's way "of punishing himself" for his personal situation. In asking for a sentence to a half-way house, the defense attorney also noted that Chang, who is 47, had recently suffered a heart attack, perhaps as a result of his "internalization of what he's done." Chang is currently working part time as a pharmacist's assistant. Hargrove, in sentencing Chang, noted that he was taking the former FDAer's health into consideration. However, the judge again noted that in sentencing Chang he was setting an example for other government employees who might consider accepting gratuities for favors. Judge Hargrove declared that "one bad apple . . . will spoil the whole bunch," and that the "potential was tremendous for injury to the public." The judge observed that there is no evidence to date that Chang did anything that would permit unsafe drugs to come on the market.

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