The Whistleblower And The Ex-Wife

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jim-marchese.jpgYou may recall that last month we wrote about a former sales rep at Cell Therapeutics named Jim Marchese who, after losing his job five years ago, met with the Justice Department to say the drugmaker had fraudulently marketed a cancer drug and bilked Medicare out of millions of dollars. And the federal government joined him in suing the drugmaker, which earlier this year forked over $10.5 million in fines.

More recently, however, the government turned around and accused Marchese of being the brains behind the fraud - “the planner and initiater” of the scam, according to documents filed in US District Court in Seattle. The US Attorney maintains Marchese also destroyed or failed to turn over evidence when he first blew the whistle on CTI. And so while whisteblowers are generally entitled to a share of the proceeds, the government is fighting to reduce his payout to nothing, as in zero dollars. For his part, Marchese disputes the charges. A hearing is tentatively set for this coming Monday.

“Marchese’s actions – for which he has never shown remorse or accepted responsibility - caused physicians to unwittingly treat thousands of gravely ill patients with a medicine which had no demonstrated therapeutic value for their diseases and also directly led to the US suffering millions of dollars in damages for which it has not been and probably never will be made whole,” the government argues. “Under these extraordinary circumstances, giving Marchese a share of the settlement proceeds would merely serve to reward Marchese’s egregious wrongdoing by enriching him at the further expense of the US and, more particularly, the Medicare program which will receive the balance of the settlement proceeds.”

whistle.jpgAt issue, as the government documents charge, is Marchese’s credibility, and a federal judge must sort it all out. But federal investigators and attorneys aren’t the only ones challenging some of his assertions. His ex-wife disputes a few recent statements as well. In an interview with The New York Times, for instance, Marchese said that due to the CTI episode, “I’ve lost six years of my life, my job, my home. It has destroyed my marriage and made my life hell.” And in an Oct. 15 court filing, he claims his “graduate degrees have been rendered useless.” Marchese, who now works as a mortgage broker, has a master’s in public health from Columbia University and a law degree from Seton Hall University.

“It angers me that he makes himself out to be the victim,” says his ex-wife, Rebecca Grande. “He redefines the Napoleon complex.”

divorce-decree.jpgLet’s take one item at a time. The marriage: Marchese and his ex-wife separated a full year after he parted ways with CTI. And she tells Pharmalot their separation in 2003 “had nothing to do with CTI. It was a combination of things. You could call them marital issues. He was very controlling. I had extra-marital concerns. But I was married to him the whole time the CTI thing was going on.” Marchese has since remarried. He declined to comment, saying only that “you are misinformed” in an e-mail he wrote us.

The house: Marchese and Grande jointly owned a house in Freehold, NJ, which she received as a result of their divorce settlement, according to documents that we have seen. Meanwhile, Marchese received a house in Colts Neck, NJ, an upscale community, which was under construction at the time of the divorce. He continues to live there. Again, Marchese declined to comment.

The degrees: It is unclear how the CTI saga prevents Marchese from exploiting his health degree. As to the law degree, we are told by Grande’s attorney, Veronica Davis, that Marchese was never admitted to practice. However, one impediment to pursuing a career in law may be the final restraining order that Grande obtained in 2004 against Marchese. The NJ Bar of Board Examiners tells us that one must not only pass the bar exam, but also pass muster with a character committee. A final restraining order may not be an automatic barrier, but this would be among the many issues to be evaluated as part of his background. Again, Marchese declined to comment.

“I’ve been familiar with his actions for three years and I’ve observed a continual pattern of lies and manipulation on his part,” says Davis, “even when it was sometimes easier to tell the truth.”

What bearing does any of this have on the court proceedings and the fight over the share of the CTI fine? The specifics may be of little or no concern to the government’s case. However, the larger issue, as the government explains it, is the extent to which Marchese’s statements can be relied upon. And it appears he may have more explaining to do.

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