Ex-'King of Biotech' set to serve four-year term for fraud

NEW YORK Tue Jan 21, 2014 11:39pm IST

Related Topics

Stocks

   

NEW YORK (Reuters) - David Blech, once dubbed the "King of Biotech", failed to persuade a U.S. appeals court to throw out his four-year prison term for securities fraud on the ground that his sentencing judge was biased.

Blech, 58, had argued in court papers that U.S. District Judge Colleen McMahon improperly considered his race and social status in imposing the sentence.

The defendant, who is white, Jewish and was once among the wealthiest Americans, said McMahon wanted to counter a view that "we let people like you get away with things that we don't let poor black drug addicts" get away with.

In an order on Tuesday, the 2nd U.S. Circuit Court of Appeals said McMahon "made a number of ill‐conceived remarks that bordered on the inappropriate," but that it was not persuaded that she sentenced Blech "based on unconstitutional factors such as race".

It said McMahon sentenced Blech based on factors including "the need for specific deterrence for a recidivist, and the need for general deterrence for those who might otherwise feel that some white‐collar crimes are 'games worth playing.'"

The court also upheld McMahon's $1.34 million forfeiture order, saying Blech waited too long to object.

Richard Levitt, a lawyer for Blech, declined to comment. The defendant had sought to be resentenced by a different judge.

Blech, who has said he has bipolar disorder, had pleaded guilty in May 2012 to manipulating shares of biopharmaceutical companies Pluristem Therapeutics Inc (PSTI.O) and Intellect Neurosciences Inc (ILNS.PK) in 2007 and 2008.

He reached a $1.03 million civil settlement last August with the U.S. Securities and Exchange Commission.

Blech had also pleaded guilty in 1998 to an unrelated fraud, but was sentenced to probation.

Earlier in his career, Blech helped found Celgene Corp (CELG.O), whose products include the blood cancer drug Revlimid, and whose market value on Friday topped $68 billion.

He also helped found Icos Corp, now part of Eli Lilly & Co (LLY.N), which developed Cialis to treat erectile dysfunction.

Forbes magazine said Blech was worth $295 million in 1992, making him among the 400 richest Americans.

Blech is housed at a low-security prison in Fort Dix, New Jersey. He is not eligible for release until March 12, 2017.

The case is U.S. v. Blech, 2nd U.S. Circuit Court of Appeals, No. 13-1881.

(Reporting by Jonathan Stempel; Editing by Stephen Powell)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

Markets

REUTERS SHOWCASE

Segway in India

Segway in India

Segway’s India business pegs hope on tech-savvy Modi  Full Article 

Power Outage

Power Outage

Mumbai hit by power cuts  Full Article 

Commodities

Commodities

Gold imports, premiums to jump on festive demand - top refiner  Full Article 

Economic Worries

Economic Worries

Pakistan's promises to IMF in doubt as protests sap economy   Full Article 

Islamic Finance

Islamic Finance

Basel III deposit challenge looms over Islamic banks   Full Article 

Antitrust Probes

Antitrust Probes

U.S. business lobby says concerned China antitrust probes unfair.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage