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Executive Summary

FORMER FDA CHEMIST DAVID BRANCATO SENTENCED to a two-year jail term, all of which was suspended, except for 30 days to be served in a work-release program, three years of probation, and 500 hours of community service. At a Jan. 5 sentencing hearing in Baltimore federal court, Brancato also was given a $3,000 fine and a $150 special assessment. Brancato is the third FDAer from the generic drug division to be sentenced for receiving illegal gratuities from officials of generic drug companies. In April, Brancato was charged with three counts of receiving a total of $4,300 in illegal gratuities from Ashok Patel, a senior VP of Par Pharmaceutical, and Dilip Shah, president and CEO of Quad Pharmaceuticals ("The Pink Sheet" May 1, T&G-1). At that time, Brancato resigned from FDA, where he had been working in the Center for Veterinary Medicine following a request for a transfer. Both Patel and Shah have been sentenced for giving illegal gratuities to Brancato, to Brancato's supervisor Charles Chang and to another chemist, from the same review branch, Walter Kletch. First Assistant U.S. Attorney Gary Jordan, the prosecuting attorney in the case, noted that Brancato admitted to investigators that he received $16,000 in cash from four drug company executives. The names of the other company officials were not disclosed, reportedly, because that information is part of an ongoing investigation. Under the charges filed in April, Brancato could have received a maximum penalty of six years incarceration and a $750,000 fine. Jordan pointed out that Brancato at first did not cooperate with the generic drug investigation, but that once he did, his "assistance was whole-hearted and extremely helpful." The former FDAer is willing to testify in future cases and will provide "important information" in that regard, Jordan added. Baltimore District Court Judge John Hargrove, in meting out the sentence, told Brancato, that "I appreciate what you have done" in cooperating with the investigation. But on the other hand, Hargrove observed that the chemist was a "very important" part of the scandal as "one of the fastest examiners." The judge pointed out that Brancato was "somewhat selected" by Chang and companies to be a target of gratuities because his ability to review ANDAs quickly "meant millions of dollars" to firms. Hargrove noted that the seriousness of Brancato's misdeeds falls between those of his supervisor Chang and his co-worker Kletch. Chang was sentenced on Oct. 3 to one-year work release, three years of probation, 1,000 hours of community service, and was fined $10,000 ("The Pink Sheet" Oct. 9, T&G-4). Chang received almost $78,000 in illegal gratuities from generic firms. Kletch was sentenced in September to a 30 day work-release program, one year probation, 120 hours of community service, and was fined $1,000. He was charged with accepting two $500 gift certificates for department stores from Shah ("The Pink Sheet" Sept. 25, T&G-2). Brancato's defense attorney, Philip Armstrong of the Rockville law firm Henney Armstrong and Henney, suggested that the judge place Brancato on probation rather than put him in jail. Armstrong cited in support of his request Brancato's cooperation in the investigation and the approximately 13 years he served in "distinction in various capacities in the government." Armstrong emphasized that what Brancato did was "wrong" and that the chemist "knows it was wrong," but that "a set of circumstances" lead him to accept the illegal gratuities.

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