Gray-market drug scheme leads to $20M forfeiture, 30 years in slammer

A Texas man was found to have laundered more than $40 million through a fake drug distributorship that bought drugs off the street and then sold them as new. (Pixabay)

A man who made tens of millions of dollars selling gray-market drugs in the U.S. has not only been sentenced to 30 years in federal prison, he is being made to pay a $700,000 tax bill.

Kenneth J. Coleman, 52, of Houston, Texas, was sentenced to 360 months for conspiracy and tax charges, after being convicted on nine counts that included conspiracy to commit money laundering and corporate tax evasion.

The government says Coleman laundered more than $41.5 million through a fake drug distribution business. In addition to prison time, he was ordered to forfeit $20.3 million and to pay $717,000 in restitution to the IRS.

Webinar This Week

OTC Innovation to Avoid Stagnation: Survey Insights, Expert Advice, and Latest Technologies to Boost Your Product’s Performance

Join us for a complimentary webinar on November 13 at 11am ET / 8am PT. Listen to industry experts as they analyze the critical role of innovation in OTC products, and strategies for achieving it.

Coleman owned Acacia Pharma Distributors and Four Corner Suppliers, which purchased bottles of prescription medications from “illegitimate sources” and then sold them to a Utah-based distributor, which then sold them to pharmacies as new, the FDA reported. The company created fake pedigrees to disguise them.

A partner in the business, Marcus Weathersby, pleaded guilty and testified against Coleman. Weathersby was sentenced to just short of five years in prison.


Suggested Articles

Lonza CEO Marc Funk is leaving for "personal reasons" after less than a year in the top job. 

Drugmakers have voluntarily recalled their generic Zantac from the U.S. market after the FDA raised concerns, but it has not been without a cost.

Just weeks after selling the sterile manufacturing assets of its Kyowa operation in Japan, it has unloaded the rest of its Kyowa drugmaking operation.