A local biotech has agreed to pay $2.1 million in reimbursements and penalties after filing false claims for payment on a federal contract and grants to develop an influenza treatment, Courthouse News Service reports.
Ansun Biopharma’s former CEO, Mang Yu, is accused of ordering vice president Dongmei Wang to fake time sheets in order to milk proceeds from a $50 million National Institutes of Health contract and two grants — a total of $1.65 million is alleged to have been stolen by filing claims for work that was never performed.
“Yu told Wang to extend the funding available on the NIH grants for as long as possible because he needed access to the money from the grants to manage cash flow problems at the company,” reads a statement from the U.S. Attorney.
In addition to repayment of the overbilling, Ansun will pay $495,000 in order to settle the false-payment claims. Wang’s fraud charge was dismissed following compliance with the terms of a deferred prosecution agreement, while Yu received a year of probation.