Trafficking in Pharmaceuticals—David Adkins

A Minneapolis lawyer has been indicted on federal allegations that he helped an Internet pharmacy illegally obtain narcotics and helped its founder hide assets.^[1] According to prosecutors, “Daniel Adkins, who was general counsel for Xpress Pharmacy Direct, helped deceive legitimate pharmacies into supplying the narcotics that Xpress hawked over the Internet and by telephone.”^[2]

Last May, Xpress was shut down after having filled roughly 72,000 “illegal prescriptions for pain killers and other controlled substances, generating sales of about $20 million.”^[3] The founder of Xpress, Christopher Smith, along with his accountant and a doctor who issued prescriptions were indicted in August.^[4] According to the indictment against Mr. Adkins, he allegedly helped Mr. Smith “hide assets after they learned about the investigation”; additionally, it states that he “wrote to legitimate pharmacies from which Xpress ordered drugs, assuring them that Xpress was ‘both legal and authorized by federal and state statutes.’”^[5] He has been charged with conspiring to distribute and dispense controlled substances, with actually distributing and dispensing controlled substances, with misbranding drugs, and with committing wire fraud.^[6]

The sheer number of charges, and facing the possibility of a $250,000 fine and up to 20 years in jail for the wire fraud charge alone, it would hardly be surprising if Mr. Adkins pleaded guilty and agreed to cooperate with the investigation. After all, the charges stem from the much larger investigation into Xpress’s alleged misconduct, and the prosecution may be willing to recommend a lenient sentence in exchange for his cooperation. As we have pointed out before, this is an entirely common thing to do.

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[1] Lawyer Charged in Internet Pharmacy Scheme, Associated Press (via Houston Chronicle), Jan. 25, 2006.
[2] Id.
[3] Id.
[4] Id.
[5] Id.
[6] Id.