Former Biopure VP Pleads Guilty to Faking Cancer to Avoid Securities Suit

Denise Lavoie

The Associated Press

March 12, 2009

A former executive of Biopure Corp. pleaded guilty Wednesday to an obstruction of justice charge for pretending he had terminal cancer and admitted he had impersonated his own doctor to dodge a federal lawsuit filed by securities regulators.

Howard Richman, a former vice president at Biopure, admitted he had instructed his lawyers to tell a judge he was gravely ill with colon cancer. He also admitted to posing as his doctor in a phone call with his lawyer so that she would tell the judge that his cancer had spread and that he was undergoing chemotherapy.

Richman, 57, declined to comment to reporters after changing his plea to guilty in U.S. District Court. But during the hearing, he admitted to committing the acts prosecutors alleged -- that he had lied from October 2006 through July 2007 when he repeatedly caused his lawyers to say he had cancer.

"I am changing my plea from not guilty to guilty for the crime I committed," he said. He had pleaded not guilty in October.

Richmond faces up to 10 years in prison at sentencing, scheduled for June 10.

Assistant U.S. Attorney James Dowden told Judge Mark Wolf that if the case had gone to trial, prosecutors would have presented evidence that Richman had fabricated the story about having cancer in an attempt to wriggle out of a lawsuit filed in 2005 by the Securities and Exchange Commission and to avoid paying a large civil fine.

The SEC complaint accused Biopure, Richman and three other executives of misleading investors over the prospects of winning approval for a synthetic blood product called Hemopure.

The U.S. Food and Drug Administration had rejected clinical trials because of safety concerns about Hemopure, a blood substitute made from cow hemoglobin.

In October 2006, Richman's lawyers told the judge their client was gravely ill from colon cancer and had less than a 15 percent chance of survival. Richman allegedly produced a forged doctor's note that said he was being treated with surgery and chemotherapy.

The next month, Richman's lawyer told the judge that her client's cancer had spread and that he was undergoing chemotherapy. Dowden said in court Wednesday that Richman "posed as his treating physician" during a phone call with the lawyer.

As a result, U.S. District Judge Patti Saris approved Richman's request to postpone a final judgment in the case, effectively ending the lawsuit against him.

In September 2007, all three of Richman's lawyers in the SEC case abruptly resigned. Three months later, a criminal lawyer hired by Richman told the judge that his client had fabricated the cancer, Dowden said in court Wednesday.

In August 2008, Richman reached a settlement with the SEC that required him to pay a $150,000 fine and barred him from serving as an officer or director of any public company.

Richman, a native of Pearland, Texas, was indicted on the obstruction charge in September 2008.