Federal prosecutors in Oregon are pursuing their first case of alleged coronavirus fraud: Authorities this month intercepted a shipment of 100 unauthorized COVID-19 test kits sent from China to a Portland man, they say.
The man who ordered the package of kits, at 50 cents each, is a former senior vice president of a now-defunct cannabis oil company, federal agents wrote in an affidavit for a search warrant signed by a judge on Wednesday.
The man hasn’t been arrested. His name was redacted from the affidavit.
Federal prosecutors said authorities wanted to move quickly to seize the unauthorized test kits before they entered the public marketplace while a deeper investigation continues by agents from Homeland Security Investigations and the Food and Drug Administration.
The only way now to get a test for the new coronavirus is through a health care provider. There is no authorized home test kit. The FDA has acknowledged that a home test kit would be useful and is working with companies to develop one.
But the Portland man who bought these kits online from China isn’t a licensed medical doctor, registered nurse or nurse practitioner or a licensed pharmacist and has no authority to use or sell them, authorities said. The China company that made and shipped them also doesn’t have authority to send them to private individuals.
COVID-19 swab tests now run at least $1,000 through certain private insurers and cost more if obtained through an FDA-approved lab test center.
“50 cents is ridiculous even for a swab. But for a test to actually give a result itself it’s a preposterous cost,” a coronavirus physician incident commander from a major Oregon hospital told federal authorities, according to the affidavit.
The case began when U.S. Customs and Border Protection officers examined a package entering the United States from China at the FedEx International Mail Facility in Memphis, Tenn. on March 18.
The package seized was labeled as “Papid (sic) Test Kit” and it contained four white boxes, each labeled “COVID-19 (SARS-CoV-2) Antibody Test Kit (Colloidal Gold).” Each box held 25 individual kits. Shipment records contained no FDA licenses.
The invoice revealed the package came from a China-based company called Anhui Deep Blue Medical Technology Co. at a total cost of $50 and was headed to a Portland address.
Federal agents, with help from a Portland police officer, found the man who bought the test kits lived in an apartment in North Portland.
The Portland man who ordered the kits had previously worked as a senior vice president of supply chain at Cure Cannabis Solutions that failed to renew its business license in September 2019, according to the affidavit, state business records and a LinkedIn account.
Authorities raided his apartment on Wednesday.
Leroy Hwang, an FDA consumer safety officer, confirmed that the tests shipped to the Portland address didn’t have FDA clearance or pre-market approval.
The kits are uncleared medical devices, Hwang found, according to the affidavit.
“These tests are for the detection of human antibody response (IgG/IgM) to the COVID-19 virus,” the affidavit quoted Hwang as saying. “The antibody test kits are often used to identify if an individual has circulating antibodies against a pathogen, which can be an indicator of either active (IgM) or previous (IgG) infection by the pathogen. However, in the case of COVID-19 virus, it has yet to be established what correlation there is between different antibody levels and infection status of the individual.”
Hwang said the seized kits, however, could possibly fall under the FDA’s emergency use authorization, allowing commercial manufacturers to develop and distribute diagnostic test kits to detect the new virus for clinical labs or to health care workers, but the policy doesn’t apply to home testing.
Hwang verified that the source of the kits, Anhui DeepBlue Medical Technology Co. Ltd. of Hefei, China, is registered with the FDA as a “contract manufacturer” but hasn’t received approval to manufacture home test kits for COVID-19 detection, according to the affidavit.
“There are currently no approved, cleared, or (emergency use ) authorized COVID-19 test kits for at-home use,’’ Hwang said. “If these kits are marketed for home use or distributed for home use, they are in violation.’’
Photos of kits similar to ones in the seized Portland package had been advertised March 14 on the Twitter account, Chin Xinhau News.
“15 minutes! New rapid test strips for #coronavirus have been developed by a company in Hefei, China. #FightVirus,’’ the tweet read, with a photo of the same packaging, using the “DeepBlue” name and dolphin logo.
A video in the tweet showed a finger-pin prick that draws blood, with the blood then placed on a test strip.
Though the video says the test strip “has been proven to be effective after clinical tests” and the test may be available on the Chinese market soon, comments in reply to the tweet indicated the efficacy of the tests remain unknown.
One unidentified person responded to the tweet, noting that a Hong Kong microbiologist has cautioned people against buying any home testing kits for the new coronavirus.
The tests are still being advertised on the website of Anhui DeepBlue Medical, which has an ecommerce website as well.
Last week, Oregon’s U.S. Attorney Billy J. Williams designated Assistant U.S. Attorney Scott Bradford, chief of the office’s Economic, National Security and Cybercrimes Unit, to help coordinate fraud cases stemming from the new coronavirus.
The FBI asks anyone who may have been the target or victim of a coronavirus-related scheme or civil rights violation to contact the FBI’s Internet Crime Complaint Center at www.IC3.gov., submit information to tips.fbi.gov, or call the FBI Portland Field Office at 503-224-4181.
— Maxine Bernstein
Email at mbernstein@oregonian.com; 503-221-8212
Follow on Twitter @maxoregonian
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