Woman faces prison time in drug scheme


A Milford woman has pleaded guilty for her role in a two-year scheme to sell more than $2 million worth of AIDS drugs that were bought from patients around the country and resold under falsified paperwork. Beth Handy, who operated as Alpine Pharma out of a Valhalla Drive home, is one of several people accused in the scheme, which officials say lasted from February 2002 through mid-2004. A Palm Springs, Calif., attorney was found guilty Tuesday by a jury in U.S. District Court in Concord of his role in the scheme. Handy pleaded guilty and testified against the attorney, Robert McFadden, during the 10-day trial, officials say. She faces up to 20 years in federal prison for her role, and is free on bail until sentencing. Handy could not be reached for comment Wednesday. McFadden was found guilty of conspiracy to launder monetary instruments, conspiracy to commit wire fraud, and conspiracy to engage in unlicensed wholesale distribution of prescription drugs. He faces up to 20 years in federal prison. The case involved Serostim, a drug that mimics human growth hormone and is used to counteract the loss of body mass that affects AIDS patients on anti-retrovirus therapy. Assistant U.S. Attorney Mark Irish, who helped prosecute the case, said evidence shows the operation proceeded like this: Handy was a licensed wholesaler of drugs. She is not a pharmacist; New Hampshire law does not require that drug wholesalers be pharmacists. Handy negotiated orders for the drugs from legitimate sources, usually other wholesalers who sold them to hospitals, doctors or patients, and then forwarded advance payments to California. There, the money was used to buy drugs from AIDS patients in Los Angeles and Palm Springs, Calif., who sold part of their supply, sometimes because they had received more than they needed. The drugs were bought at prices well below wholesale and the resulting profits were pocketed among several people involved, Irish said. A course of Serostim can cost several thousand dollars a month per patient. "As part of the fraud, she (Handy) would prepare phony packing slips and fax them out to California . . . because she was the only one that had a license," Irish said. Officials began investigating after the New Hampshire Board of Pharmacy detected irregularities in Handy's records. Irish said it there is no evidence that the drugs were tampered with, but nonetheless the case presented a public safety hazard. "When you have a drug like this, that can keep people alive, you can't just be buying it off the streets of California," he said. The federal Prescription Drug Marketing Act sets out requirement for paperwork along the chain of distribution of medication. "The whole reason that (officials) require the pedigree to be accurate, the paperwork behind the origin of drugs, is to help prevent problems," he said. Irish said the seriousness of the crime is reflected in the effort behind the prosecution. Investigations were undertaken by several federal agencies, including IRS Criminal Investigation, which gets involved with wire fraud and money laundering, and search warrants were issued for Handy's home, in California, and elsewhere. "We've been investigating this case for the better part of four years," Irish said.
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