2 Scientists Indicted in Conspiracy to Sell Research Secrets

A federal grand jury Tuesday indicted two New Jersey research scientists on charges that they conspired to make millions of dollars selling stolen trade secrets for the commercial production of two pharmaceuticals, including a brand of interferon used to treat a form of cancer common among people with AIDS.

Bernard Mayles, a 52-year-old Manalapan, N.J., resident named in the indictment, was a research scientist at Schering-Plough Inc., a Madison, N.J.-based pharmaceuticals company that makes the interferon, a genetically engineered drug used to treat AIDS-related Kaposi’s sarcoma.

Mayles also was previously a senior research scientist at Rahway, N.J.-based Merck & Co., according to the indictment. The indictment alleged that he and Mario Miscio, a 63-year-old Hazlet, N.J., resident, first offered last February to sell information on a number of pharmaceuticals, including data on Merck’s ivermectin drug, to an undercover federal agent. Merck sells ivermectin to fight parasites in animals and for two years has donated the drug to treat a form of blindness in humans caused by parasites.

The indictment is significant to the pharmaceuticals industry, which spends billions of dollars to develop drugs, said Michael Chertoff, U.S. Attorney in New Jersey. “If proprietary research is not protected from theft, no business can afford to invest the energy and money necessary to develop new medical and scientific technology,” he said.

Special agents of the Federal Bureau of Investigation arrested Mayles and Miscio in Atlanta on Aug. 10 after they handed over a folder and a specimen of the microorganism needed to make ivermectin in exchange for $1 million in cash and $500,000 in bonds, according to Chertoff. According to the indictment, they believed that the FBI undercover agent was an international broker. They initially sought $2.2 million for the ivermectin process and had sold a portion of the process to the undercover agent for $2,500 in May, the indictment said.

Mayles and Miscio were at the same time trying to negotiate an interferon deal for $6 million to $8 million, the indictment said.

The two were charged with conspiracy, wire fraud and interstate transmission of stolen property. If convicted, they could face 30 years in jail and millions in fines, according to the U.S. Attorney. They pleaded not guilty to initial federal criminal complaint and were released on $50,000 bail each. Neither could be reached for comment Tuesday.

Mayles and Miscio were affiliated with Biopharm Research Inc., a pharmaceuticals research and consulting firm in Hazlet, where the U.S. Attorney’s office says other evidence of a scheme to sell patent-protected drugs was found.

Mayles, who holds a Ph.D. in microbiology from the University of West Virginia, signed an agreement not to disclose confidential information when he left both Schering and Merck, officials of the drug companies said. The indictment said Miscio is believed to be an organic chemist educated in Italy who was listed as the director of Biopharm.

Sales of Schering’s interferon--sold under license from Biogen--have grown from about $50 million in 1988 to a projected $100 million in 1990, according to analysts.

Merck’s ivermectin is the leading animal health product in the world with sales of more than $1 billion since it was introduced in the 1970s, the company said. Under the brand name Mectizan, it has been donated since late 1988 to residents of tropical rain forest areas, such as region’s of West Africa’s Mali, for an affliction commonly known as river blindness.