After being convicted of money laundering and fraud charges in May, the former chief executive officer of Hatboro-based Philidor Rx services, now closed, was sentenced to one year and one day in prison.
Andrew Davenport, who resides in Haverford and led Philidor Rx Services, and Gary Tanner, a manager at Valeant Pharmaceuticals International, were arrested in late 2016 and charged by the U.S. Attorney’s Office in New York with conspiring on a multimillion-dollar fraud and kickback scheme.Tanner was also found guilty of fraud and money laundering charges in May, and sentenced to one year and one day in jail.
In addition to the prison sentence, U.S. District Judge Loretta A. Preska sentenced Tanner, 41, of Gilbert, Ariz., and Davenport, 50, to two years of supervised release, and ordered each to forfeit about $9.7 million, writes John George in the Philadelphia Business Journal.
The two men, according to the criminal complaint, devised a plan to increase Valeant’s dependence on Philidor, and then get Valeant — a Canadian pharmaceutical company — to eventually agree to buy Philidor, in an effort to reap tens of millions of dollars in personal profits.
In December 2014, Valeant paid $100 million for an option to purchase Philidor. The option deal included multimillion-dollar sales-based milestone payments that could have driven the value of the deal up to almost $300 million. As part of the agreement, Davenport allegedly personally obtained more than $40 million from Valeant, then – according to court records – secretly kicked back $9.7 million to Tanner through a series of shell companies.
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