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South Carolina Virologist Charged With Illegal Campaign Contributions, Grant Fraud

22 September 2011 4:45 pm
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A virologist who worked on biodefense vaccines and was active in South Carolina politics has been charged with making illegal campaign contributions and using research grants to defraud the U.S. government. Jian-Yun Dong of the Medical University of South Carolina in Charleston was named in two federal indictments filed 5 months ago and released this week by the U.S. district court in Charleston. Two biotech companies launched and directed by Dong (who is also known as John Dong)—GenPhar and a spinoff called Vaxima, both in Mt. Pleasant, South Carolina—are named as part of a fraud.

The first indictment accuses Dong and his wife, Danher Wang, of soliciting and making illicit cash contributions—including more than $30,000 from a German business colleague—to the 2008 election campaign of Senator Lindsey Graham (R-SC). (Graham was not charged; the senator and prosecutors have said that he was not aware of the alleged misconduct.) Dong is accused of trying to evade limits on campaign contributions in several ways, for example, by using the name of his daughter, then a minor, as a campaign contributor.

The second indictment charges Dong and an unnamed "person A"—described in the indictment as the vice president for research and development at GenPhar—with conspiring to submit "false, fictitious, and fraudulent" statements to the U.S. government between 2004 and 2011 in connection with research grants. Person A has not been indicted. The exact amount of funding under scrutiny isn't made clear in the indictment, but the grants came from the U.S. Army Medical Research Acquisition Activity, the National Institutes of Health (NIH), and the Naval Medical Research Center. Some of GenPhar's NIH grant money ($1.3 million, according to news reports) came from projects earmarked by Congress and promoted by Senator Graham.

The Medical University of South Carolina said in a statement this week that Dong "will be placed on administrative leave until resolution of the federal charges." Spokesperson Heather Woolwine points out that GenPhar research projects were never under the university's control and that Dong is not currently receiving federal grants for work at the university. But, she added, the school is going over Dong's past research with a "fine-tooth comb" to check for management and scientific problems. According to NIH, Dong received eight NIH grants between 2001 and 2009 worth a total of about $5 million. They supported a range of studies, from work on gene therapy tools (including adenovirus and rous sarcoma virus vectors) to development of a new vaccine for the deadly Marburg virus.

Biodefense researcher Alan Schmaljohn of the University of Maryland School of Medicine in Baltimore, who has collaborated with Dong and briefly considered joining GenPhar, says Dong seemed "a pretty smart scientist," although "inclined to push the limits." Many people, Schmaljohn says, found Dong "too forceful" as a promoter of himself and his science. GenPhar's main thrust, according to Schmaljohn, was the "technology edge" it brought to virus vector development-particularly work on a non-replicating adenovirus that could express multiple proteins. Dong's curriculum vitae lists a dozen patents or patent applications based on his work.

Dong could not be reached for comment. But Dong denied all the charges in an interview yesterday in Charleston's The Post and Courier. "Everything they are saying is false," Dong told the newspaper. He is quoted as saying that the $36,000 he received from Germany was compensation for work he had done and had no connection to campaign contributions.

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