A Democrat federal prosecutor on a ‘corporate fraud strike force’ has been accused of rank hypocrisy for profiting from $25million worth of shares from his billionaire father’s drug firm after the Justice Department alleged the company defrauded Medicare.
Los Angeles prosecutor Adam Schleifer, a former Democrat congressional candidate and member of the DOJ’s ‘Corporate & Securities Fraud Strike Force’, is the son of Regeneron CEO Leonard Schleifer, who is worth $2.5billion according to Forbes.
The same $75billion pharmaceutical company is famous for its Covid-19 antibody cocktail used by Donald Trump towards the end of his first term in the White House.
The DOJ accused the drug firm of taking ‘fraudulently inflated Medicare reimbursement rates’ for its macular degeneration drug, Eylea.
Regeneron filings obtained by DailyMail.com show that in June 2024, two months after the DOJ filed its civil complaint, 25,000 company shares were sold – sending $25,383,828.68 to a trust ‘for the benefit of Adam P. Schleifer’.
Former top White House official Robert Wasinger accused Schleifer of ‘rank hypocrisy’ over the $25million sale, telling DailyMail.com that he believes profiting from a company accused of defrauding the government was unacceptable for an anti-fraud prosecutor.
‘The public is finally waking up to the rank hypocrisy and corruption of our justice system,’ Wasinger, Trump’s former State Department White House Liaison, told DailyMail.com.
‘How is it that Adam Schleifer can serve on a DOJ Corporate Fraud Task Force while at the same time selling $25million in Regeneron stock two months after the government sues them for a massive Medicare fraud?’
Los Angeles prosecutor Adam Schleifer is being labeled a hypocrite as an anti-fraud prosecutor from taking $25million in shares from his father’s company that’s currently being investigated by the DOJ for Medicare fraud
Regeneron CEO Leonard Schleifer is Adam’s father. His company is accused by the DOJ of taking ‘fraudulently inflated Medicare reimbursement rates’ for its macular degeneration drug Eylea
Former top White House official Robert Wasinger accused Schleifer of ‘rank hypocrisy’ over the $25million sale
As the millions are held in a trust for Schleifer, it is unclear whether he or somebody else directed the sales.
Corporate filings also show the federal prosecutor is entitled to an annual allowance of up to $250,000 in flights with his father on Regeneron’s Gulfstream G450 private jet.
An investor report published in 2024 by the drug company says Adam’s CEO father, as well as his wife and children if they accompany him, are allotted up to $250,000 a year of ‘personal air travel’ in the firm’s jet, to ‘provide a more secure environment’.
But the latest company report for their 2023 spending shows Leonard maxed out his $250,000 allowance for private jet travel on trips for himself and his family.
Adam Schleifer declined to comment to DailyMail.com.
A spokesman for the Los Angeles DOJ office said Schleifer’s stock ownership was ‘irrelevant’ to his current work as a federal prosecutor.
The Justice Department’s civil complaint against Regeneron was filed in April last year.
It claims the firm subsidized credit card fees for Eylea’s distributors, such as ophthalmologist clinics, but hid those payments in their reports to Centers for Medicare and Medicaid Services, and received inflated reimbursements of taxpayer money for its drug sales.
President Donald Trump praised the effectiveness of Regeneron’s Covid cocktail, REGN-COV2 and received a dose during his first term in the White House
Adam Schleifer has directly owned as many as 29,275 shares of Class A Regeneron stock, according to a Regeneron filing from 2006
Principal Deputy Attorney General Brian Boynton said he wouldn’t allow pharmaceutical companies to hide the truth about their drug prices to make a profit
Corporate filings also show Adam is entitled to an annual allowance of up to $250,000 in flights with his father on Regeneron’s Gulfstream G450 private jet
Leonard maxed out his $250,000 allowance for private jet travel on trips for himself and his family
Total US sales of Eylea reached $5.7 billion in 2023, and Medicare has spent $11.5 billion on the drug since 2013 according to court filings
‘We will not permit pharmaceutical companies to flout price reporting requirements to maintain high drug prices,’ Principal Deputy Attorney General Brian Boynton said in a statement when the DOJ lawsuit was filed.
A Regeneron spokeswoman told DailyMail.com the DOJ’s claims, filed in a Massachusetts federal court, are ‘without merit’ and demonstrate ‘a fundamental misunderstanding of drug price reporting standards’.
She said the payments were a ‘lawful reimbursement of costs incurred by our specialty distributors’.
Total US sales of Eylea reached $5.7billion in 2023, and Medicare has spent $11.5billion on the drug since 2013 according to court filings.
Prosecutor Adam Schleifer has directly owned as many as 29,275 shares of Class A Regeneron stock, according to a company filing from 2006.
A notice of Regeneron share sales filed with the Securities Exchange Commission on June 12, 2024, listed 25,000 shares sold for a total $25,383,828.68, in three transactions between June 6 and June 12.
The ‘Trust f/b/o Adam P. Schleifer’ was listed under the seller’s name for those three sales.
Schleifer’s stake in Regeneron also became an issue during his 2020 campaign for New York’s 17th congressional district – which includes the affluent county of Westchester where Regeneron’s headquarters are located.
The Justice Department’s civil complaint against Regeneron was filed in April last year and claims the firm subsidized credit card fees for distributors of its drug Eylea
Regeneron filings obtained by DailyMail.com show that in June 2024, two months after the DOJ filed its complaint, 25,000 company shares were sold to benefit Adam Schleifer’s trust
Leonard Schleifer’s net worth is estimated at $2.5billion. He is the Chairman and CEO of Regeneron and owns two percent of its common stock
Six other Democratic primary candidates pledged to divest from pharma stock if they won to avoid conflicts of interest when regulating drug companies. Schleifer did not join the pledge.
An opponent’s campaign manager even reportedly accused him in June 2020 of ‘using millions of his drug company inheritance to try to buy this election’, after he funded his campaign with more than $5million of his own cash, according to the politics newsletter Sludge.
FEC records show Schleifer loaned and donated $5,197,000 of his own money to his 2020 campaign and raised a further $530,000 from other donors.
Schleifer lost in the primary, and in January 2021, returned from his year-long hiatus to his prosecutor job at the DOJ’s Los Angeles office where he had been working since 2016.
Adam’s father Leonard Schleifer, whose net worth is $2.5billion, is chairman and CEO of Regeneron, and owns two percent of its common stock, according to Forbes.
The $75billion NASDAQ-listed firm was thrust into the spotlight during the height of the Covid-19 pandemic in 2020 when Donald Trump praised the effectiveness of its antibody cocktail REGN-COV2, which he took.
Regeneron was accused of skullduggery in a 2021 lawsuit by shareholders, who claimed executives including Leonard Schleifer reaped over $650 million in stock sales after making fake donations to a ‘sham’ charity as part of an ‘audacious and illicit scheme’ scheme to inflate their drug prices since 2013.
The shareholder’s claim came after the DOJ also sued Regeneron over the same alleged charity ‘kickback’ scheme in 2020.
The legal complaint, filed in a New York federal court in July 2021, claimed Regeneron executives made donations to an allegedly fake charity called the Chronic Disease Fund (CDF), which purportedly helped patients with medical care costs.
Regeneron was sued in 2021 by shareholders who claimed Leonard Schleifer and other executives received more than $650million in stock sales after making fake donations to a ‘sham’ charity
The ‘sham’ charity was the Chronic Disease Fund (CDF), which was meant to help patients with medical care costs. But the suit stated the charity used the money to influence more prescriptions for their drug Elyea
Massachusetts US Attorney Andrew Lelling said Regeneron ‘funneled tens of millions of dollars in kickbacks’ and that senior executives tried to hide their tracks
But the CDF was not independent, the lawsuit claims, and they allegedly used the money to pay for patients’ and doctors’ costs for Regeneron’s flagship drug Eylea – pushing them to use that drug over others.
‘Regeneron’s payments to the CDF ensured that virtually no Medicare patient paid a copay, deductible or coinsurance amount on Eylea,’ the legal filing said.
According to the complaint, it meant that instead of using Avastin, a $55-per-dose off-label alternative, they used Eylea and charged Medicare $1,850 per dose.
‘Thus, Regeneron would pocket the higher total sales price, increasing its total revenues, at Medicare’s expense,’ the lawsuit by Regeneron shareholder Donald Ball said.
‘The company’s financial position – and indeed its ability to continue to do business – has been imperiled by the individual defendants’ audacious and illicit scheme.’
Leonard Schleifer was among 16 executives named in the lawsuit.
When the DOJ announced their 2020 lawsuit for the alleged scheme, Massachusetts US Attorney Andrew Lelling said Regeneron ‘funneled tens of millions of dollars in kickbacks,’ adding that ‘senior company executives allegedly took extensive measures to cover up the scheme’.
Regeneron denies the claims.
A Regeneron spokeswoman told DailyMail.com that the sums donated to CDF were ‘lawful, charitable donations’ adding that ‘Regeneron is proud to support charitable co-pay assistance foundations’.
‘Regeneron has fully cooperated with the Government’s investigations and will vigorously defend itself in court,’ the spokeswoman said.
The DoJ’s civil case against Regeneron is ongoing, but has not yet gone to trial and has been in limbo since December 2023, while the government and drug company have been battling in an appeals court over aspects of the case.
‘I do have my job for life, so hopefully this case will be resolved during that span of time, God willing,’ the judge joked in the most recent status conference on December 29, 2023.
The CDF did not respond to DailyMail.com’s request for comment.
