An Ebola researcher from the Charleston County area was convicted on Tuesday of defrauding the federal government.
Dr. Jian Yun Dong and the companies he founded—GenPhar Inc. and Vaxima Inc. — were found guilty of soliciting millions of dollars worth of funds intended for Ebola vaccine research while funneling the money towards building a new headquarters in Mount Pleasant. Further money was diverted to pay for lobbyists meant to help secure even more funding.
The case centered around $3.6 million in federal grants intended for researching vaccines for the Ebola and Marburg viruses. During the original 2014 trial—which resulted in a hung jury—witnesses testified that GenPhar had created a vaccine that was effective in monkey trials. When the construction of a new GenPhar headquarters was announced, it was hopped that this was a sign the research was paying off. In a sense, it was, but not in the way people expected.
It was later discovered that large portions of construction funds came from diverted research grants. More grant money was allegedly redirected to illegal campaign donations to Senator Lindsey Graham’s office under the hope that the South Carolina senator would steer further funds towards GenPhar. The senator’s office has not been charged in connection with this case, as investigators believe his staff was unaware the donations were improper.
The 2014 trial saw GenPhar and Vaxima convicted of theft and numerous counts of wire fraud while Dr. Dong was convicted of lying to investigators and witness tampering. The 2015 retrial on the fraud charges, which took place in late June, ended in conviction this past Tuesday.
U.S. Attorney William N. Nettles offered some comment on the matter following the conviction. “The real tragedy in this case is that millions of dollars intended for desperately needed vaccine research was diverted into a commercial real estate project. Most of the dedicated and accomplished scientists receiving these grants can be trusted to spend the funds on research, but those that seek to divert the funds to their own benefit need to know that we will pursue charges against them like any other fraudsters.”
A date has not yet been set for Dr. Dong’s sentencing phase.
Sources for Today’s Article:
“Dr. Dong, GenPhar Inc., and Vaxima Inc. Convicted of Fraud in Retrial Before U.S. District Court Judge David Norton,” FBI web site, August 4, 2015; https://www.fbi.gov/columbia/press-releases/2015/dr.-dong-genphar-inc.-and-vaxima-inc.-convicted-of-fraud-in-retrial-before-u.s.-district-court-judge-david-norton.
Munday, D., “Jury Deadlocks on Mount Pleasant Doctor Accused of Misusing Ebola Vaccine Grant,” Post and Courier web site, November 17, 2014; http://www.postandcourier.com/article/20141117/PC16/141119422.
United States of America v. Jian-Yun Dong, Vaxima Inc. 2011. United States District Court for the District of South Carolina Charleston Division, 2:11-cr-00511-DCN. Entry No. 3.