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Sentencing set for June as Johnson City cancer doctor pleads guilty to federal charge

Rex Barber • Dec 11, 2012 at 4:06 PM

GREENEVILLE — As expected, a doctor at the center of a “misbranded” medication scandal at a local cancer treatment center pleaded guilty Tuesday morning in U.S. District Court in Greeneville, and afterward one of his attorneys said “the whole story” in the case will soon be provided.

Dr. William Kincaid, one of three physicians in the partnership that was McLeod Blood and Cancer Center in Johnson City, entered a plea to “receiving in interstate commerce a misbranded drug with intent to defraud or mislead” Tuesday morning before Judge Ronnie Greer.

A sentencing hearing was set for June 3. Kincaid, 67, faces up to three years in prison, a fine up to $250,000, supervised release up to a year and probation up to five years.

The guilty plea means Kincaid is now a convicted felon.

Greer granted Kincaid a bond of $20,000. He posted that bond and left the courthouse with his attorneys, Mark Slagle and Guy Blackwell, who spoke on his behalf.

Slagle said forthcoming information will “tell the whole story.”

No further explanation of this additional information was given but Blackwell said it would likely be released in a few weeks.

According to information in the plea agreement, the federal government claims McLeod purchased $2 million worth of cancer medications from a company named Quality Specialty Products, located in Canada, but the drugs were not processed through an FDA-approved supplier.

The drugs cost less than the clinic was paying from FDA-approved suppliers in the U.S. and a decision was made by Kincaid, Dr. Ray Lamb and Dr. Charles Famoyin for the business manager, Michael Combs, to order the drugs in September 2007.

Later that year and in 2008, nurses raised concerns about the medications with foreign language on the labels. Shipments from QSP stopped but were resumed in 2009 with the drugs going to a storage business in which Kincaid had part ownership. These drugs were then mingled into the FDA-approved drugs at the cancer clinic.

Kincaid’s plea agreement lists nine medications the government says were purchased from QSP. Those medications are Abraxane, Alimta, Avastin, Eloxatin, Gemzar, Herceptin, Rituaxan, Taxotere and Zometa.

Neil Smith, senior litigation counsel, said the government will continue to investigate the case and other similar cases in the Eastern District of Tennessee and across the nation.

“The investigation’s never completely over,” Smith said. “There’s certainly additional matters that U.S. attorney’s office, through its civil division, is taking as far as recovering funds and property paid in the case.”

Asked why misbranded drugs would be purchased, Smith said medical oncologists are reimbursed for cancer drugs at 106 percent of the average sale price of those drugs. Chemotherapy clinics are also reimbursed for the cost of infusions.

“So basically what a physician is doing by buying drugs from unapproved sources at prices lower than the average sale price is to maximize profit,” Smith said.

Kincaid’s family was in the courtroom Tuesday and so were Debbie Swift and Deniece Norris, whose father, Bobby Bunten, was a patient of Kincaid’s for about three years.

The women said it was a shock to hear Kincaid’s plea acknowledging he intended to mislead with the misbranded drugs.

“But we’re relieved now,” Swift said. “Our family’s been through a lot in the past couple of years.”

Combs was charged during the investigation, which began in February, and pleaded guilty to one count of receiving misbranded drugs. He faces up to a year in prison and a $100,000 fine, and a possible five-year probation term. Combs is scheduled for sentencing on April 1.

There have been no indication Lamb or Famoyin will be prosecuted in the case. Famoyin left McLeod earlier this year to open his own cancer treatment clinic, and Lamb is reportedly in the process of doing the same.

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