'Pharmaceutical Companies Must Take Responsibility'

July 30, 2008— -- The blood thinner heparin is one of the most used drugs in America, employed daily in hospital surgeries and for kidney dialysis patients.

But a safe supply of this critical drug fell into jeopardy last winter in a catastrophe that illuminated severe problems caused by the fact that most ingredients for American drugs now come from foreign sources. These sources are not being adequately monitored by either the pharmaceutical industry or the Food and Drug Administration.

The FDA told "Nightline" that as many as 55, or perhaps considerably more, people may have died from the contaminated heparin. So far it's only been able to definitively link three deaths to specific lots of the tainted drug.

Although so far it's only been able to definitively link three deaths to specific lots of the tainted drug.Heparin used to be primarily produced by the pharmaceutical giant Baxter, but Baxter recalled its entire stock, nearly half the nation's supply, after the deaths from contaminated heparin. A number of smaller companies also recalled supplies. To date, Baxter says they have received 955 reports about contaminated heparin in 2008.

That's when billionaire pharmaceutical executive Dr. Patrick Soon-Shiong and his company American Pharmaceutical Partners (APP) stepped in with a large, safe supply of the drug. Without it, countless more Americans would have died.

"How would all these thousands of dialysis patients have dialysis? What would happen to all these surgeries?" Soon-Shiong said. "I have no idea; it's very scary to have thought."

Soon-Shiong has called for the reform of how the pharmaceutical industry polices its products. The companies must take a greater role, he argues, because the FDA is simply overwhelmed.

Heparin Horror

No one knows that better than Leroy Hubley. He says his wife of 48 years, Bonnie, died from a severe allergic reaction after taking contaminated heparin at a Toledo dialysis clinic.

"The doctors recommended we remove her breathing tube to end her suffering," Leroy recalled in congressional testimony. "Our entire family -- our son, daughter, in-laws and grandchildren -- were all there. Christmas music played in the background, and each one of us said our goodbyes. Then my wife of 48 years drifted away."

Hubley's nightmare didn't end there. Within weeks, he says his only son, Randy, also a dialysis patient, died after taking heparin from the same batch of the drug.

"He too developed nausea, low blood pressure, fatigue, abdominal pain and diarrhea," Hubley testified. "A week later, my 47-year-old son was dead, leaving behind three children and a grandchild." Randy also left behind his wife, Colleen Hubley, who testified before Congress.

Investigations into the deaths pointed to China, where the raw ingredient for heparin originates.  According to the FDA, someone there spiked the crude heparin with a counterfeit look-alike drug to increase profit.

"I see these foreign drugs as essentially a string of time bombs," said former FDA commissioner William Hubbard. "Heparin has gone off, and there will be more until we fix the problem."

'Process Controls'

Heparin isn't the only drug that's manufactured overseas. Roughly 80 percent of all the raw ingredients for America's drugs now come from foreign countries. Soon-Shiong, who has made billions as a pharmaceutical executive, is calling for reform.

"It became very clear to me that, unfortunately, the future is that China and India will be the breadbasket of raw materials, creating the raw materials for the rest of the world," he said. "I think heparin is a prime example of where pharmaceutical companies must take responsibility"

He said the FDA must also take responsibility, "but the FDA is overwhelmed," he said.  Heparin may be used in high-tech medicine, but the raw material is literally hand-wrung from pigs' intestines in crude agricultural workshops. And the process is virtually unregulated.

"There is no process controls at the farmer level," Soon-Shiong said. "One has no idea what crude comes in, the source of the crude, are the pigs ill, do these pigs have any viruses. Frankly, are these pigs, even?"

Soon-Shiong says at his plant in China they track the entire supply chain, from "the live pig, the health and welfare of the pig, all the way to the slaughterhouse, all the way to the intestine, all the way into the crude heparin, all the way into the final heparin."

Prioritizing Patients

It's not the first time he has bucked his own industry. Back in 1985, when Soon-Shiong was working as a surgeon, he was poised to perform a pioneering transplant of cells from pigs to humans when he made a chilling discovery.

"We discovered a virus in pigs, and I refused to do that transplant," he said. "My investors said, You will do the transplants."

His investors later sued him for fraud, and he won in arbitration.

"I recall vividly, they said, 'You know, heroes and pioneers take risks, and all that you will suffer is a slap on the hand from the FDA.' And I said, 'No, that's not all I'll suffer. We'll put patients' lives at risk and I will not do it,'" he recalled.

Soon-Shiong's unwavering stance in the face of opposition may come from his personal biography. He grew up in South Africa under apartheid, and he had to fight to become the first nonwhite doctor in a whites-only hospital.

He later emigrated to the U.S. with his wife Michele, whose career as a television actress paid the bills while he labored in a university lab.

"I wanted to follow my dreams with regard to my science and my research," he said.

The gamble paid off. Soon-Shiong's medical prowess and business skills have made him one of the richest men in the pharmaceutical industry.

Self-Regulation

FDA Commissioner Janet Woodcock says the FDA is taking a "much closer look" at the safety of drugs that come from overseas, but the administration is woefully underfunded to safeguard America's drug supply.

Hubbard said the FDA "can only inspect less than 1 percent of imported foods and drugs. For example, [the FDA] can go to virtually none of these foreign drug manufacturers because it simply does not have the staff to do so."

"We don't have the resources to do that, nor should it be our primary responsibility," Woodcock said. She said the FDA keeps Americans safe "by holding the people accountable who are on the ground. Our inspectors can't be in every plant all the time."

In fact, the FDA never even inspected Baxter's supplier "SPL" in China because they couldn't find it.

"The plant wasn't inspected because there was a mix-up between that plant and another one," Woodcock said, "and it appeared that the plant that had been mixed up with this plant actually had been inspected, and so we felt that this plant had been inspected."

That leaves the pharmaceutical companies to police themselves.  Baxter did conduct its own inspection last September and gave itself a passing grade, just months before Americans began dying from contaminated heparin.

"It is clearly our job to make sure that our therapies are safe, for which we have our own inspections and our own audits," said Baxter's chief scientist, Norbert Riedel. "But it is also the responsibility of the FDA to provide the necessary oversight and checks and balances than that is indeed occurring."

Riedel says that Baxter has formed a task force to examine the oversight process.

"We have put a team of scientists in place, and I'm chartering them with the task of asking where else could any one of our products be tampered with in this fashion," he said.

But Riedel points out that additional inspectors may not have saved any lives from the spiked heparin.

"I think the contaminant was made to be so similar to heparin that no test that we had in place and no facility inspection could have found it," he said.

A number of families, including the Hubley's, are now suing Baxter for wrongful death.

While there may be disagreement about how best to provide oversight, there is no argument in Soon-Shiong's mind.

"Some contaminant was absolutely added," he said. "But there were some ways to protect and prevent not just the additive, but to control the supply chain and catch it very early on."

Leroy Hubley might agree with the need for control when many precious lives hang in the balance.

"Now I am left only to deal with the pain of my wife and son, [knowing] that the unsafe drug was permitted to be sold in this country," he said. "The FDA and Baxter have not done their job. Somebody sure as hell didn't."

Article updated July 31, 2008.

ABCNews.com producer Katie Escherich contributed to this report.