Update: On December 13, 2017, the U.S. Court of Appeals for the Second Circuit vacated William Scully's conviction because a lower court "declined to allow Scully to introduce evidence at his 2015 trial showing he sought legal advice about importing drugs with foreign labels from one of his lawyers." Ultimately Scully pleaded guilty to one charge of introducing misbranded drugs into interstate commerce, and received a sentence of 32 months. An August 17, 2016 forfeiture order of $889,875 remained the same.
Long Island drug importation kingpin convicted in case that exposed thousands of unsuspecting Americans to misbranded and counterfeit medication produced abroad.
On November 12, 2015, William Scully, co-owner of a broad-ranging drug importation business called Pharmalogical Inc./Medical Device King was convicted of 66 charges related to his unsanctioned pharmaceutical wholesaling business. According to the jury verdict in his trial, Scully was convicted of wire and mail fraud, along with the introduction of misbranded drugs into interstate commerce and the resale of same. Scully was illegally importing prescription medication, and distributing it via sale to hundreds of doctors and clinics throughout the United States, according to a report in Newsday.
The case began in 2013, when the Food and Drug Administration (FDA) sent warnings out to 781 doctors and clinics in 48 states warning that Medical Device King (MDK) was an unlicensed pharmaceutical wholesaler. The warning letter states “Prescription drugs distributed by MDK may be counterfeit drugs (not manufactured or distributed by the company indicated on their label); and/or may be drugs from foreign or unknown sources that are not approved for distribution in the United States. These drugs may have unknown ingredients, or may not have been manufactured, transported or stored under proper conditions as required by U.S. law, regulations, and standards.”
The FDA warning went on to explain that FDA lab tests on specific lots of vial labeled “Avastin,” and found that at least one contained no active ingredient at all. The warning went on to inform recipients that MDK was offering at least 30 other medications, including several cancer treatments for which there could be no guarantee of provenance. According to the FDA, “these drugs have not undergone scientific and regulatory review by FDA to ensure their safety and efficacy. While these drugs purport to have the same active ingredients as other drug products that have U.S. market approval, they are not legally marketed and have not been established by FDA to be therapeutically equivalent to or interchangeable with U.S. approved products that contain the same active ingredients.”
Scully’s indictment claimed that Medical Device King was selling imported misbranded and counterfeit prescription drugs originally shipped from the United Kingdom, Turkey, the Cayman Islands, Canada, United Arab Emirates, Switzerland and India. The drugs were misrepresented as FDA approved drugs. According to the indictment, approximately 1,000 medical practices purchased the illegally imported pharmaceuticals from Medical Device King.
MDK's overseas suppliers included Ozay Pharmaceuticals, a Turkish company that sold Altuzan with no active ingredient to Richard Taylor, a United Kingdom drug wholesaler who sold it to American medical practices. Two of Ozay's executives were indicted in January 2014. They pleaded guilty in July and August 2014, respectively. One, Okzan Semizoglu was sentenced to 27 months in October 2014.
According to the Department of Justice press release on the occasion of Scully’s indictment, Scully faces a maximum sentence of 20 years and fines of over $17 million.