Thursday, March 8, 2007
The U.S. Securities and Exchange Commission today simultaneously filed and settled civil charges against Shashikant C. Shah, formerly Vice President of Quality Control, Quality Assurance and Regulatory Affairs of now-defunct generic drug manufacturer Able Laboratories, Inc., alleging that during a 16-month period, Shah reaped $909,000 in profits by selling Able's common stock while possessing material, non-public information about Able's faulty quality control testing practices. Before halting operations in May 2005 after an internal review uncovered such testing improprieties, Able developed, manufactured and sold at least 40 generic drugs including numerous antibiotic, analgesic and antipsychotic medications.
Also on March 8, 2007, in a related criminal action filed by the United States Attorney's Office for the District of New Jersey, Shah pleaded guilty to one count of conspiracy to commit securities fraud and to distribute misbranded and adulterated drugs. Three former supervisory chemists under Shah, Jose Concepcion, Ashish Macwan and Jyotin Parikh, also pleaded guilty to separate criminal informations charging each with one count of conspiracy to distribute misbranded and adulterated drug products. Shah and the three chemists each face a maximum of five years in federal prison and a $250,000 fine. The issue of restitution will be determined by the sentencing court.