Waksal Is Accused of Forgery

An ImClone Systems Inc. lawyer accused company founder Samuel Waksal of forging a stock certificate 16 years ago. The allegation came in testimony Thursday before a House oversight panel investigating the handling of ImClone’s cancer drug Erbitux.

General counsel John Landes never notified the company’s board and made the allegation for the first time before the committee. Waksal, indicted Aug. 12 on insider trading, perjury and bank fraud charges, allegedly forged the lawyer’s signature on a 1986 document to sell 12,000 ImClone shares then valued at $90,000, Landes said.

Revelations about Waksal, who was ImClone’s chief executive until he resigned in May, came as lawmakers grilled company executives about oversight of the company and its most promising product. ImClone executives said Waksal’s leadership was more important than what they characterized as his personal financial problems.

“I regarded Sam Waksal as a visionary who started the company and enabled c225, or Erbitux, to be brought to the company and developed,” said Paul Kopperl, chairman of ImClone’s audit committee.

Landes said he learned of the alleged forgery in 1991.

Mark Pomerantz, Waksal’s attorney, didn’t return a message left with his assistant seeking comment.

The Food and Drug Administration’s rejection of ImClone’s Erbitux application, which the company disclosed Dec. 28, sent shares down 88% and led to three government probes. The New York-based biotechnology company faces a dozen shareholder lawsuits claiming it misled investors.

ImClone shares fell 16 cents to $6.86 in New York Stock Exchange trading.

The panel asked directors about their oversight during what lawmakers said was a pattern of spending abuse by Waksal.

In the last decade, the company approved more than $1 million in personal loans to Waksal. In July 2001, ImClone loaned him $18.2 million, which allowed him to exercise stock options and warrants.

Board members told the panel that he has repaid “every penny.”