Hazlet man admits to role in drug co. scam BY CHRIS GAETANO Staff Writer NEWARK - A Hazlet man was among four people who pleaded guilty last week to falsifying laboratory reports to rush prescription drugs to the market. Jose Concepcion, 57, of Hazlet, worked in quality assurance and control for the now defunct pharmaceutical company Able Laboratories. He and Shashikant Shah, 65, of South Brunswick, Jyotin Parikh, 56, of Clifton, and Ashish Macwan, 47, of Tinton Falls, entered guilty pleas on March 8 before a federal court. The charges brought before the former workers for the South Plainfield-based company include conspiracy to distribute misbranded and adulterated drugs and, in Shah's case, an additional count of conspiracy to commit securities fraud. According to U.S. Attorney Christopher Christie, the rise and fall of Able Laboratories can be directly linked to the dealings of the four men named above. Authorities say that the quartet engaged in a conspiracy between 1999 and 2005, when investigations into the company's laboratory practices began. When the plan was first hatched, shares for Able on the NASDAQ exchange ranged between 17 and 55 cents each. Around 2002, however, stock prices began to rise dramatically as profits in the company began to soar, culminating in an all-time high of $26.50 per share around May 2005. Unbeknown to the shareholders, though, this sudden windfall held a secret. During the four men's guilty plea hearings before U.S. District Judge Susan D. Wigenton, in Newark, the details of the plot were explained in full. During laboratory trials for a number of generic prescription drugs that needed to be properly tested before meeting FDA approval, the defendants admitted that they, with other chemists, manipulated and altered tests and reports sent to the regulatory body. They admitted that they did so through changing test parameters to obtain the results they wanted and also forged data in lab notebooks and binders. This was all done in the interest of getting the FDA to approve the manufacture of a new generic drug product. Fully aware of what was going on, Shah, who, like other high-level Able executives, had stock options with the company, used his knowledge to conduct a series of insider trades that netted him more than $900,000 in profits. This happened before the company began a disastrous downturn when questions about its laboratory procedures began coming to light. On May 19, 2005, the company announced it was suspending shipments of its entire product line as well as recalling certain other products because of indications of improper laboratory practices. At the close of trading on the same day, stock prices plummeted 75 percent, from more than $24 a share on May 18 to about $6.36 a share at the end of May 19. About $340 million was lost as a result, according to Assistant U.S. Attorney Robert Kirsch. By the end of July of that year, the company was removed from the NASDAQ exchange after filing for bankruptcy. All four could face up to five years in federal prison and a $250,000 fine. Christie commented in a press release on how their actions put people at risk. "The damage from the fraud at Able Labs was devastatingly complete," he said. "Consumers were put at risk, a company that employed 500 people was destroyed, and shareholders were left with nothing in the end. This is the legacy of the fraud perpetrated at Able Labs by these defendants." The investigation into the lab's dealings is ongoing.