Former Valeant Executive and Co-Defendant Sentenced to Prison
31 October 2018 - 7:14AM
Dow Jones News
By Patrick Thomas
A former executive at Valeant Pharmaceuticals International Inc.
was sentenced Tuesday to spend a year in prison after being found
guilty of defrauding the pharmaceutical giant through a
multimillion-dollar kickback scheme.
Gary Tanner, and his co-defendant, Andrew Davenport, the former
chief executive of specialty mail-order pharmacy Philidor Rx
Services, were both sentenced to one year and a day in prison. A
Manhattan federal jury in May convicted both men on all four counts
they faced, including honest services wire fraud and
money-laundering conspiracy. The sentence from Senior U.S. District
Judge Loretta Preska, who also presided over the defendants' trial,
also called for two years of supervised release and for the men to
forfeit about $9.7 million each.
Prosecutors had alleged Valeant, now named Bausch Health Cos.,
was the victim of fraud, with Messrs. Tanner and Davenport
conspiring to persuade the pharmaceutical company to funnel
business to Philidor. Mr. Davenport paid Mr. Tanner about $10
million in kickbacks, while Mr. Tanner used his position at Valeant
to facilitate deals that helped Mr. Davenport take in more than $40
million, prosecutors said.
The defense lawyers had argued the two were working in Valeant's
interest, developing Philidor as a partner and generating profits
for both companies.
Attorneys for Messrs. Tanner and Davenport couldn't immediately
be reached for comment. A representative from Bausch Health
couldn't be reached for comment.
"Gary Tanner and Andrew Davenport conspired to deceive and
defraud Tanner's employer, Valeant, in order to enrich them both,"
Manhattan U.S. Attorney Geoffrey S. Berman said in a prepared
statement. "Tanner was entrusted to manage Valeant's relationship
with Davenport's company. Instead, they devised a scheme to pillage
Valeant and share the proceeds. Now Tanner and Davenport have been
sentenced for their crimes."
The now-closed Philidor, based in Pennsylvania, assisted Valeant
in selling some of its higher-priced products. At one point, at
least 90% of the drugs Philidor dispensed were from Valeant,
prosecutors said.
Bausch Health, based in Quebec, changed its name from Valeant
earlier this year.
Write to Patrick Thomas at Patrick.Thomas@wsj.com
(END) Dow Jones Newswires
October 30, 2018 15:59 ET (19:59 GMT)
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