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Criminal probe opened into alleged lapses at Eli Lilly plant: Sources

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Eli Lilly

(Reuters) — The U.S. Justice Department has launched a criminal investigation into Eli Lilly and Co. focused on alleged manufacturing irregularities and records tampering at a factory in Branchburg, New Jersey, that produces the pharmaceutical giant's COVID-19 therapy and other drugs, three people familiar with the matter said.

The probe represents a significant escalation of the government scrutiny of Lilly. The pharmaceutical company, one of the world's largest, has been under examination for more than a year by the U.S. Food and Drug Administration over alleged manufacturing and records violations at the Branchburg factory.

Reuters questioned Lilly about the criminal inquiry on Wednesday. On Thursday morning, the company disclosed in a securities filing that it had received a subpoena from the Justice Department this month seeking documents related to the Branchburg factory.

The company did not disclose anything more about the nature or focus of the investigation and said it was cooperating fully in the matter.

Lilly said it had previously engaged external counsel to conduct an independent investigation of certain allegations relating to the Branchburg plant. The company submitted the same information Thursday to Reuters in response to the news agency’s questions.

“Lilly is deeply committed to manufacturing high-quality medicines for patients who need them, and the safety and quality of our products is our highest priority,” the company said.

The Justice Department inquiry follows a Reuters report in March that a Lilly human resources officer alleged she had been forced out of her job at the factory after undertaking internal investigations of employee complaints about manufacturing lapses, falsified or destroyed records, and staff shortages.

In April, employees accused a factory executive of altering FDA-required documents in order to downplay problems, according to an unsigned internal complaint reviewed by Reuters.

The company previously told Reuters that none of the issues flagged by FDA inspectors affected the quality of medicines released to doctors and patients. Lilly also has denied retaliating against any employees.

The Justice Department inquiry, which involves U.S. prosecutors and other officials in New Jersey and Washington, began in recent weeks, the three people said. The FBI is participating in the probe, they said.

A spokesman for the New Jersey U.S. attorney's office declined to confirm or deny the existence of an investigation. Justice Department and FDA representatives in Washington had no immediate comment on the probe. The FBI declined to comment.

The investigation is in its earliest stages, the three people told Reuters, and the Justice Department has not accused Lilly or any of its employees of wrongdoing. The department could ultimately pursue criminal charges, seek civil sanctions or close the probe without taking action.

In November 2019, FDA inspectors arrived at the Branchburg plant for an inspection and found that quality control data had been deleted and not appropriately audited, Reuters has reported. The plant produced blockbuster diabetes drug Trulicity as well as several cancer medications.

Federal documents show the FDA cited the problems in March 2020 as “Official Action Indicated,” or OAI, which is its most serious category of violation. If not addressed, an OAI can lead to a prohibition on the sale of drugs from a facility, regulatory experts say. The FDA has not taken further public action.

In October, the Trump administration ordered $375 million worth of Lilly’s COVID-19 antibody therapy bamlanivimab, which is manufactured in Branchburg. Shortly afterward, the FDA authorized the drug’s use on an emergency basis to help curb the pandemic. Bamlanivimab is now combined with a second Lilly drug, called etesevimab, to treat COVID-19.

A condition of the emergency authorization was that an outside auditor inspect batches of bamlanivimab to ensure they met FDA standards. Lilly and the FDA have not responded to questions from Reuters about whether this requirement was met.