Crawford To Plead Guilty
Former FDA Commissioner Lester Crawford is expected to plead guilty on Tuesday to federal charges that he failed to disclose his and his wife's ownership of stock in companies regulated by the agency, according to his attorney, Barbara Van Gelder, the Washington Post reports (Kaufman, Washington Post, 10/17).
Crawford left FDA in September 2005, two months after his Senate confirmation. At the time, some reports indicated that a failure to disclose financial holdings led Crawford to leave.
HHS Inspector General Daniel Levinson launched an investigation into Crawford's departure after several lawmakers raised concerns about his reasons for leaving, such as whether he followed ethics laws that required him to report his financial assets and income to the federal government (California Healthline, 10/26/05).
On Monday, the Department of Justice charged Crawford with two misdemeanors -- making false statements and conflict of interest -- each of which carries a maximum penalty of one year in prison (Alonso-Zaldivar, Los Angeles Times, 10/17).
Van Gelder said that Crawford would plead guilty to the charges and that she expects him to be fined and placed on probation (Saul, New York Times, 10/17). Van Gelder said, "He is going to admit his financial disclosures had errors and omission, mostly with his wife's continued ownership of stocks" (Yost, AP/Seattle Post-Intelligencer, 10/17).
According to DOJ prosecutors, government ethics officials told Crawford in 2002 that he and his wife needed to sell shares in 12 companies that were regulated by FDA (Washington Post, 10/17). The couple sold shares in nine of the companies -- which included Johnson & Johnson, Merck, Boston Scientific, Pfizer, Medtronic and others -- but kept shares in three companies: food and beverage maker PepsiCo; food distributor Sysco; and Kimberly-Clark, which makes some consumer health care products, DOJ said.
In addition, Crawford's wife held shares in Wal-Mart, which also is regulated by FDA, but Crawford did not include those holdings in his 2002 financial disclosure, DOJ said. Crawford also failed to disclose that he held options to buy 41,500 shares in Embrex, an FDA-regulated poultry biotechnology company on whose board he once served.
According to DOJ, Crawford reported on his 2003 and 2004 tax returns that he exercised some of those options -- earning $8,150 in one transaction and $20,627 in another -- but failed to disclose the filings and the remaining options.
When Crawford was appointed acting FDA commissioner in 2004, HHS reviewers again inquired about his ownership of Sysco and Kimberly-Clark shares. Crawford wrote in an e-mail message to an ethics official that the shares "have in fact been sold." However, the DOJ filing states, "In truth and in fact, as Crawford then knew, Crawford and/or his wife held shares" in Sysco and Kimberly-Clark "throughout 2003 and 2004" (New York Times, 10/17).
According to DOJ, Crawford also held at least $62,000 in PepsiCo shares and $78,000 in Sysco shares while he chaired the FDA Obesity Working Group, which makes recommendations affecting the food and beverage industries (Carey, CQ HealthBeat, 10/16). His ownership of those shares violated federal conflict of interest laws, DOJ said (Los Angeles Times, 10/17).
The Crawfords' Kimberly-Clark shares were worth as much as $90,000, and the Wal-Mart shares were worth as much $71,000, according to DOJ. The couple no longer holds shares in Kimberly-Clark, Wal-Mart or Sysco.
Van Gelder said, "I don't think at the time [the Crawfords] thought Kimberly-Clark, PepsiCo, Sysco and Wal-Mart were regulated by the FDA, but they were. And that's why he's pleading guilty" (Rockoff, Baltimore Sun, 10/17). She added, "At the end of the day, he owned these stocks, and he will admit he owned them while he was at the FDA, and he will take responsibility" (Washington Post, 10/17).
Before Crawford left FDA, he revised his financial disclosure forms to include all his holdings, Van Gelder said. "One of the things I hope comes out is that he sold the Mercks and the pharmaceuticals. ... You wouldn't think Wal-Mart is in the same boat as Merck," she said (New York Times, 10/17).
A spokesperson for the HHS Office of Inspector General, which continues to investigate Crawford, declined to comment.
FDA and HHS spokespeople also declined to comment (Wilde Mathews, Wall Street Journal, 10/17).
NPR's "Morning Edition" on Tuesday reported on the charges against Crawford. The segment includes comments from Jerry Avorn, professor of medicine at Harvard Medical School and author of "Powerful Medicines: The Benefits, Risks and Costs of Prescription Drugs"; Crawford; Michael Jacobson, director of the Center for Science in the Public Interest; and Van Gelder (Silberner, "Morning Edition," NPR, 10/17).
The complete segment is available online in RealPlayer.
In addition, NPR's "All Things Considered" on Monday reported on the charges against Crawford. The segment includes comments from NPR health policy correspondent Joanne Silberner (Siegel, "All Things Considered," NPR, 10/16).
The complete segment is available online in RealPlayer.