Judgment No. 350/2017/HSST dated September 19, 2017 regarding manufacturing and trading of counterfeit medicines for treatment or prevention of diseases

THE PEOPLE’S COURT OF HO CHI MINH CITY

JUDGMENT NO. 350/2017/HSST DATED SEPTEMBER 19, 2017 REGARDING MANUFACTURING AND TRADING OF COUNTERFEIT MEDICINES FOR TREATMENT OR PREVENTION OF DISEASES

On September 19, 2017, the first instance trial was conducted at the office of People’s Court of Ho Chi Minh City to hear the criminal case No. 381/2017/HSST dated July 13, 2017 against the defendants:

1/ Mai Cong P; born in 1953 in Dong Thap; permanent residence: Doc L, Tan Q Ward, Tan P District, Ho Chi Minh City; occupation: free trade; educational level: 9/12; family circumstances: the defendant has a wife and four children, the oldest was born in 1971, the youngest was born in 1981; his father: Mai Van T (alive); his mother: Tran Thi C (alive); previous conviction: on March 26, 2010, the People's Court of Ho Chi Minh City sentenced him to 05 years 06 months’ imprisonment for "Manufacturing and trading of counterfeit medicines for treatment or prevention of diseases"; prison term is from January 1, 2009; previous administrative violation: none; the defendant was detained from August 25, 2016 (present)

2/ Mai Thanh H1; nick name: M; born in 1977 in Dong Thap; permanent residence: Do Doc L, Tan Q Ward, Tan P District, Ho Chi Minh City; occupation: none; education level: 4/12; family circumstance: the defendant has no wife or children; his father: Mai Cong P (alive); his mother: Nguyen Thi L (alive); previous conviction: on 20 August 2012, the People's Court of Ho Chi Minh City sentenced him to 03 years’ imprisonment but the Court gave him probation period of 5 years from the date of pronouncement of the offence "Manufacturing and trading of counterfeit medicines for treatment or prevention of diseases”.

On January 9, 2013, the Appellate Court of the Supreme People’s Court in Ho Chi Minh City issued a decision on suspension of the appellate hearing for the reason that the Supreme People's Procuracy withdrew the protest against the First Instance Judgment dated August 20, 2012; previous administrative violation: none; detained from August 25, 2016 (present)

3/ Khuu Tuan C; born in 1969 in Ho Chi Minh City; permanent residence: Lo G Street, A Ward, X District, Ho Chi Minh City; address: Long D, Rach Cat Ben L, Ward B, District Y, Ho Chi Minh City; occupation: self-employed; educational level: 7/12: family circumstance: he has a wife and 1 child born in 1998; his father: Khuu S (alive); his mother: Khuu To Ha M (alive); previous conviction: on August 25, 2010, the People's Court of Ho Chi Minh City sentenced him to 04 years 06 months’ imprisonment for "Manufacturing and trading of counterfeit medicines for treatment or prevention of diseases". Term of imprisonment commenced from September 9, 2009; previous administrative violation: none; detained from August 25, 2016 (present)

4/ Tran Quang S; born in 1986 in Ho Chi Minh City; permanent residence: Vo Van T, Ward A, District Z, Ho Chi Minh City; address: Rach Cat Ben L Street, Ward B, District Y, Ho Chi Minh City; occupation: self-employed; educational level: 9/12; his father: Tran Quang D (dead); his mother: Nguyen Thi Ngoc D (alive); previous conviction: on September 24, 2009, the People's Court of District Z sentenced him to 1 year and 10 months’ imprisonment for "Snatching"; the prison term is from February 27, 2009. On August 22, 2012, the People's Court of Ho Chi Minh City sentenced him to 1 year in prison for "Theft". The prison term is from April 9, 2012 to May 22, 2014, the Ho Chi Minh City People's Court adjudicated the appeal and sentenced him to 03 years in prison for "Theft", the prison term commenced from August 21, 2013; previous administrative violation: none, detained since August 25, 2016 (present)

5/ Tran Quang B; born in 1990 in Quang Ngai; permanent residence: team Q, village E, Nghia N commune, Quang Ngai city, Quang Ngai province; address: Le Cao L, Phu T Ward, Tan P District, Ho Chi Minh City; occupation: packaging printing; educational level: 9/12; family circumstance: the defendant has no wife or children; his father: Tran H (alive); his mother: Le Thi Le C (alive); previous convictions or administrative violations: none; detained from August 25, 2016 (present)

Persons with relevant rights and obligations:

1 / Mr. Le Tong N (present)

Permanent residence: Tran Van D, Ward F, District Z, Ho Chi Minh City

2/ Mrs. Nguyen Thi Kim H2 (present)

Permanent residence: Bui Tu T, An L Ward, Binh T District, Ho Chi Minh City  

3/ Nguyen Ngoc Kim S (present)

Permanent residence: Bui Tu T, An L Ward, Binh T District, Ho Chi Minh City

4/ Mr. Nguyen Kim P (present)

Permanent residence: Bui Tu T, An L Ward, Binh T District, Ho Chi Minh City

DEEMING THAT

The defendants were prosecuted by the Ho Chi Minh City People's Procuracy on criminal offenses as follows:

At 11am on August 25, 2016, the working group of the Police Department for Investigation of Economic Crimes and Corruption affiliated to Ho Chi Minh City Public Security discovered and made a record of arresting the offender Mai Thanh H1 who was riding a motorbike carrying a carton containing unlabeled capsule modern medicines from Bui Tu T street, An L ward, Binh T district to the house on Long D street, Rach Gia Ben L, Ward B, District Y to deliver to Khuu Tuan C for producing counterfeit brands Pharmaton and Di Ansel.

At the Investigation Agency, Mai Thanh H1 admitted that the caught western medicines are drugs with IBUPARAVIC brand (manufactured by KHACOPHARMA company), bought by H at the counter J7 drug market in District 10 without invoices or proof of payment, he took them home at Bui Tu T, An L Ward, Binh T District to remove them from the blister packs, then solely delivered the pills to Khuu Tuan C for C to make counterfeit medicine with foreign medicine brands and sold them on the market to gain profit. While H was on the way to deliver the said medicines to C, he was arrested.

Upon urgent search at the house of Khuu Tuan C, address: Long D Street, Rach Cat Ben L, Ward B, District Y, Khuu Tuan C and Tran Quang S were caught counterfeiting modern medicines Pharmaton and Di Ansel brands. Throughout questioning, Khuu Tuan C confessed that Mai Cong P has hired him to produce fake pharmaceutical drugs. C has received pills, packages, capsules from Mai Thanh H1 and Mai Cong P, and then Tran Quang S and he will counterfeit imported medicines by pressing blister packs, cutting blisters, packing medicines to make fake drugs.

Upon urgent search at the house of Mai Cong P, address: Binh H, Binh C district, the police detected and seized 4 boxes of counterfeit finished products and 2 boxes of fake medicine boxes. Mai Cong P admitted manufacturing and trading fake pharmaceutical drugs of all kinds with the method as follows: P has bought western medicines manufactured by Vietnam and then has assigned Mai Thanh H1 to remove pills from blisters, and then give the pills and the pharmaceutical package to Khuu Tuan C for producing counterfeit drugs, then hand back to P to sell them. Regarding packaging, label, brand of fake medicines, Mai Cong P has hired Tran Quang B to print them.  

 Upon urgent search at the accommodation of Tran Quang B, 59 Le Cao Street, Phu Thanh Ward, Tan Phu District, the police seized a laptop, a CPU used to design counterfeit products, a carton of packaging drugs used as drug model etc. Tran Quang B admitted that he has designed packages of imported drugs, and then has hired people to print packages and instruction for use labels.

On the same date August 25, 2016, Investigation Body affiliated to Ho Chi Minh City Public Security urgently searched places related to the manufacturing and trading of counterfeit pharmaceutical drugs of Mai Cong P and accomplices, including: the house on Bui Tu T, An L Ward, Binh T District; the house located in Thanh P commune, Ben L road, Long An province; the house on Tran Van D street, Ward F, District Z; Ngoc K printing shop, 199 Nguyen Dinh C, Ward G, Phu N district; Tien P printing shop, 9X Street, Binh Hung Hoa Y Ward, Binh T District, the police detected and seized a large number of counterfeit medicines of all kinds and instruments and means to produce counterfeit medicines. The investigation findings show that:

From March 2016, Mai Cong P started manufacturing and trading of drugs with counterfeit foreign brands. Mai Cong P and Mai Thanh H1 (the biological child of P), together have manufactured counterfeit medicines and H has been paid from VND 500,000 to VND 700,000 VND per week. P also has hired Khuu Tuan C to manufacture counterfeit medicines and pay him remuneration 500 VND per finished blister.

Mai Cong P went to Kim B market by himself to buy materials and equipment to assemble blister presses, blister cutters. After that, P assigned Mai Thanh H1 1 blister press and 1 blister cutter, put in hamlet 1R, Thanh P commune, Ben L district, Long An province. P delivered to Khuu Tuan C 2 blister cutters, 1 blister press, 1 cutter, put at the house: Long D Street, Rach Cat Ben L, Ward B, District Y used to make fake medicines.

P ordered a person called Quy (unknown identity) to make aluminum blisters with fake pharmaceutical labels, plastic blisters, medicine paper boxes. By the middle of March, 2016, because some packages printed by Q were mistaken but P could not contact with Q, P has ordered Tran Quang B to print more 4 types of fake pharmaceutical boxes, including: Fugacar, Laroscorbine , Neo-Codion, Neo-Tergynan (P cannot remember clearly the number of printing products). Materials used in the manufacturing of counterfeit drugs are medicines made in Vietnam with cheap price, purchased at the drug stores at the District W drug market. P assigned Mai Thanh H1 to buy, and then removed pills from blister packs to produce counterfeit foreign brand medicines.

Mai Cong P assigned the production of counterfeit medicines to Khuu Tuan C and Mai Thanh H1 by buying medicines made in Vietnam, then removing pills from blister packs and then pressing them in new blisters with foreign brand drugs; including: Voltarel Regard 50mg; Anchor Codion; Alpha Chymotrypsine; Di-Ansel; Pharmaton; Fugacar; Laroscorbine; Neo-Tergynan; Vastarel. When finishing, they will return products to P for further sale. The sale of pharmaceutical medicines has been made by Mai Cong P only, he often sells counterfeit drugs to persons called T1 in An Giang; Kt in Cao L, Dong Thap; T2 in Tien Giang; T3 in Ben Tre (unknown identity, background). Specific transactions: these persons will call P to order. P will call them upon complete manufacturing, the buyer will transfer money to P through a freight station and in turn P will forward the freight through the freight station, the trade has been carried on without any record or proof.

During the manufacturing and trading, Mai Cong P has hired Le Tong N to deliver freight to freight station and pay VND 50,000 per shipment. Early August, 2016, there were some shipments failed to be delivered, Mai Cong P asked N to put them at Nghia's house, address of Tran Van D Street, Ward F, District Z.

- On September 9, 2016, the Investigation Body affiliated to Ho Chi Minh City Public Security make a request to the Center for Quality Control of Drug, Cosmetics and Food of Ho Chi Minh City for assessment of the above mentioned medicines, with specific result as follows:

+ Among the samples of medicines sent for assessment, 06 drugs labeled Neo -Tergynan, Fugacar, Laroscorbine, Di-Ansel, Pharmaton, Vastarel 20mg do not meet quality standards, are fake medicines.

+ Sample of medicine labeled Voltaren Retard 50mg: not tested due to lack of quality standards. Verification at the Representative Office of Norvatis Pharma Services AG in Ho Chi Minh City, results of the determination: The above material sample is not a genuine product of the Norvatis Group. The Norvatis Group does not sell a product with trade name Voltaren Retard 50mg worldwide.

+ Samples of medicines labeled Neo-Codion, Alpha Chymotrypsine, Choay, Lexomil: not tested because there is no reference standard.

- On December 2, 2016, Investigation Body affiliated to Ho Chi Minh City Public Security organized suspects to carry out experimental investigation by using instruments and equipment  that were seized by Investigation Body to manufacture counterfeit medicines. Investigation findings show that:

+ Defendant Mai Thanh H1 has done as follows: putting tablets into the aluminum blisters labeled Fugacar, Laroscobine, then putting them into the blister press to smear into the blister pack, and then putting the blister into the cutter into blister finished products.

+ Defendant Khuu Tuan C has done as follows: putting tablets into the plastic aluminum blisters labeled fake medicines, then putting them into the blister press to smear into the blister pack, and then putting the blister into the cutter into blister finished products.

+ Defendant Tran Quang S has done as follows: putting tablets into the plastic aluminum blisters labeled fake medicines, then putting them into the blister press to smear into the blister pack, and then putting the blister into the cutter into blister finished products.

+ Defendant Tran Quang B has done the work of prepress and designing fake medicine package by launching a personal computer (laptop), then using the computer program to open, edit blank package of fake pharmaceutical drugs, then printing of paper packaging.

- During the investigation, Mai Cong P, Mai Thanh H1, Khuu Tuan C, Tran Quang B confessed their crime as follows:

Defendant Mai Cong P confessed: From March 2016, Mai Cong P started manufacturing and trading of drugs with counterfeit foreign brands including: Voltarel Regard 50mg; Neo Codion; Alpha Chymotrypsine; Di-Ansel; Pharmaton; Fugacar; Laroscorbine; Neo-Tergynan; Vastarel. P cannot remember specific amount of counterfeit medicines produced due to lack of records and bookkeeping as well as a great number of defective medicines which have been unsold and disposed of during the manufacturing process. Mai Cong P has assigned Khuu Tuan C and Mai Thanh H1 to be fully in charge of manufacturing of counterfeit medicines, C and H have forged drugs brands such as: Voltarel Regard 50mg, Neo-codion, Alpha Chymotrypsine, Di- Ansel, Pharmaton. C has mainly counterfeited modern medicines labeled Di-Ansel and Pharmaton. Mai Thanh H1 has made fake labeled Fugacar, Laroscorbine, Neo-Tergynan, Vastarel. They both self-assigned to make other fake drugs (these drugs did not sell well, they just have been made in small quantities). Apart from Mai Thanh H1, Khuu Tuan C, P admitted he had not hired anyone else involved in the production of counterfeit drugs as above. When hiring H and C to produce counterfeit medicines, both of them have known that they are fake pharmaceuticals but still have worked for P to make money.

As to the packaging used to produce counterfeit drugs: About January 2016, with the intention to make fake pharmaceutical drugs, P asked and knew a person called Quy has been able to make fake drug packages. P contacted and met Q at a coffee shop near the District 10 drug markets. After the discussion, P ordered Q to print packages for counterfeit drugs with the amount as follows: each type of paper packages, plastic blister is 1,000 boxes with 2,000 plastic blisters; each type of aluminum brand blisters is 10kg. He also ordered Fugacar anti-counterfeit stamps (5000 stamps). Q paid VND 10,300,000 for counterfeit packages and fake stamps (anti-counterfeit stamps: VND 2,500,000, plastic blisters: VND 3,000,000, aluminum boxes: VND 4,800,000). P only ordered Q a shipment as above, without placing any additional packages or stamps. After ordering, Q made and delivered to P in several batches, delivered to P in person at a coffee shop and P paid cash to Q. After receiving the above shipment, by March 2016, P has been no longer in contact with Q (the previous phone number of Q is no longer in use). Unable to place another order from Q, P moved on to order paper packages from Tran Quang B.

As to sale of fake drugs, Mai Cong P admitted that he has only sold them in An Giang, Tien Giang, Ben Tre, Dong Thap provinces, specifically as follows: There are some persons named T1 in An Giang; K in Cao L, Dong Thap; T2 in Tien Giang; T3 in Ben Tre (unknown identity, background), have called P to order. P will call them upon complete manufacturing, the buyer will transfer money to P through a freight station and in turn P will forward the freight through the freight station. The trade has been carried on without any record or proof. P remembered selling the amount of counterfeit drugs as follows:

Voltaren 50 mg: sold about 200 boxes, VND 20,000 VND/box, earned VND 4 million; Neo-codion: sold about 300 boxes, VND 12,000/box, earned VND 3,600,000;

Alpha chymotrypsine Choay: sold about 300 boxes, VND 13,000/box, earned VND 3,900,000;

Neo-Tergynan: sold about 300 boxes; VND 18,000/box, earned VND 5,400,000; Fugacar: sold about 500 boxes; VND 3,000/box, earned VND 1,500,000;

Laroscorbine; Pharmaton; Vastarel 20 mg, Lexomile: remain unsold; Di-Ansel: sold about 200 boxes, VND 2000/box, collected the amount of VND 4 million. The total proceeds from the sale of counterfeit drugs is VND 22,400,000; each drug box generates a VND 1000 profit; the generated profit is about VND 1,800,000 (less the remuneration paid for Mai Thanh H1, Khuu Tuan C, package cost, etc.).

Defendant Mai Thanh H1 stated: In the production of fake pharmaceutical drugs, H buy pharmaceutical materials from drug stores in District 10 drug market, including: MA drug store (Pharmaton); FB drug store (Diantavit); An T Pharmaceutical Company (Alpha); JC drug store (vitamin C). After that, H rented a house in R hamlet, Thanh P commune, Ben L, Long An (leased by Nguyen Kim P, Nguyen Ngoc Kim S) to produce fake medicine there. In addition, H has borrowed a house at Bui Tu T, An L Ward, Binh T District (the house of Nguyen Thi Kim H2) to store counterfeit drugs, blister packs. While renting and borrowing the two houses, H did not let the homeowners know the purpose of using the house for manufacturing counterfeit medicines and storing fake drugs. While manufacturing fake drugs, Mai Thanh H1 has been paid from VND 500,000 to VND 700,000 per week by Mai Cong P.

Defendant Khuu Tuan C stated: Mai Cong P has hired him to fake 2 types of pharmaceutical drugs called Pharmaton and Di-Ansel and paid VND 2000 for a box (box of 4 blisters, VND 500 per blister). During a production batch, C made about 150 boxes a day, but due to not doing regular batches, C does not remember clearly how many counterfeit drugs are produced. On average, the amount of money earned from the production of counterfeit drugs for Mai Cong P is about VND 8,000,000 per month. In early August 2016, C hired Tran Quang S to produce counterfeit drugs with C at the address: Rach C, Ben L, Ward B, District Y and paid S for about VND 3 million.

For the counterfeit drugs manufactured by C as above, after completion, C delivered them all to Mai Cong P to receive remuneration. C does not know exactly how these drugs were used further.

Defendant Tran Quang S stated: In early August 8, 2016, having just left a reformatory school and stayed unemployed, S stayed with Khuu Tuan C at the address: Rach C, Ben L, Ward B, District Y. While living together, S saw that C has made a fake medicines and Son has requested to help and C has agreed to hire S to assist the manufacturing of counterfeit medicines with remuneration of VND 3,000,000 (excluding accommodation cost). S had helped C to manufacture 2 kinds of fake medicines Pharmaton and Di-Ansel from August 6, 2016 to August 25, 2016 before he was arrested. Apart from above work, Son did not do anything else. S cannot remember how many fake drugs he made; C paid S VND 3,000,000 in cash. Son clearly knew that manufacturing fake drugs with C was violation of criminal law but he needed money.

Defendant Tran Quang B stated: B is Director of Printing Company A, address: Phu Lam B Street, Ward E, District F. This place only hangs the company’s banner but the company actually operates elsewhere. Around December 2015, introduced by an acquaintance, B met Mai Cong P in the District 10 drug market. Then, P hired B to print pharmaceutical drug packages for P to produce counterfeit pharmaceutical drugs. In March 2016, P gave B samples of foreign drug packages (about 5 and 6) for B to design equivalent patterns on computer and then send P a quotation, P would order the design that he deemed similar. B brought samples home and used computer software such as AI, Photoshop, Corel to design patterns on the computer. During the process of making, B printed patterns for P's approval. B brought patterns deemed qualified to District W drug market on To Hien T street and ordered Bao (unknown identity) to order print molds. After that, Binh brought the print molds and paper to the Ngoc K printing shop, at Do B, Tay T Ward, Tan P District to print the counterfeit packaging. B came to the printing shop and met G (shop owner) in person to order printing, when finished, B came to take products and pay cash to G there. When placing order, B only said he ordered on behalf of the printing company A. In addition to Ngoc K printing shop, in May 2016, B contacted to order printing in Tien P's printing shop but he failed.  Binh has manufactured fake drug packages for Mai Cong P from March 2016 to June 2016, with the following quantities: Fugacar (boxes): 5000 boxes, VND 800 per box; Neo-Codion (boxes): 1000 boxes, VND 1000 per box; Neo-Tergynan (boxes): 1000 boxes, VND 1000 per box; Alpha Choay (boxes): 1000 boxes, VND 1000 per box; 500 sheets of instructions for use Neo - Tergynan, 500 sheets of instructions for use Alpha Choay (free of charge) + 1000 boxes Laroscorbine. Total price: VND 1,500,000. 

By May 2016, P gave B extra samples of tin boxes of Fugacar and some other drugs, but because B was unable to print tin boxes so he did not accept the order.

B knew that the receipt of order to print foreign drug packages from Mai Cong P is illegal. Since B has set up Printing Company A from April 2015, he has known the regulations on printing and medicine production. During the transaction and printing packages for P, P said that this package used to produce counterfeit medicines and Binh agreed to do with the price of printing the package higher than the normal price.

Le Tong N stated:

N has worked as a motorbike taxi driver in the area of Saigon railway station.

In March 2016, while N was driving a motorbike taxi in District A, Mai Cong P met N to hire him as a shipper. N had shipped products for P from March 2016 to August 2016, when delivery is needed, P called and asked N to ride a motorbike to ​​Cao L Street, District Y, then P personally bring out the products and a paper with the recipient's telephone number for N (packages were either in cartons or black plastic bags) to deliver them to the bus station and consign products to the recipient through an inter-provincial coach. On average, Nghia has carried a shipment every 4 or 5 days, each carrying a package or a carton box. Products were often delivered to Western provinces (N cannot remember where the products were delivered). P usually paid Nghia VND 50,000 for a shipment.   By middle of August 2016, P has given some products to N for shipment to customers. However, P then called Nghia and informed that the customer refused to receive the products and asked Nghia to keep them for him. Nghia brought them home at address: Tran Van D, Ward F, District Z until August 25, 2016 when the Investigation Body discovered and seized the products. N stated that he did not know what products of P were, because P did not say what they were and the products were either packed in cartons or contained in black plastic bag, so he cannot see the products inside.

Le Hung G, Director of Ngoc K Printing Shop: Ngoc K Manufacturing - Trading - Service Co., Ltd, headquartered at: Nguyen Dinh C Street, Ward G, Phu N District, which was issued with a business registration certificate dated April 2, 2014 by the Department of Planning and Investment of Ho Chi Minh City. The main line of business is printing. Ngoc K Company has registered a business location at Do B, Tay T Ward, Tan P District for use as a printing shop. G is the legal representative cum Director. In May 2016, Tran Quang B (then named Tran B) came to the Ngoc K printing shop to order G to print the medicine packaging. After arrangement, G agreed. Accordingly, B personally carried the paper and the print mold (ordered by B from Bao before) to the Ngoc K printing shop and decided the order quantity. Based on the type of paper, the number of prints, G gave a quotation of VND 1,000 per sheet to Binh. If Binh agreed, G proceeded to print. When printing was finished, Binh personally came to the printing shop to get products. In total, Binh ordered the printing of medicine packages in the printing shop of G twice, in specific:  On May 13, 2016, Binh ordered a quantity of about 3,000 sheets (boxes, instructions for use). The printing fee was VND 4,083,000.

On June 17, 2016, Binh ordered a quantity of about 3,500 sheets (boxes, instructions for use). The printing fee was VND 5,000,000. Because they only came to any arrangement orally without any contract or bookkeeping of printing order, so G cannot remember exactly what type and specific amount. In addition to 2 times as above, G did not receive any other printing order from B as well as other business transaction. G did not know that B produced fake products and who is Mai Cong P.

- The Investigation Body summoned and recorded testimonies of Nguyen Thi Kim H2, Nguyen Ngoc Kim S, Nguyen Kim P who are owners of houses at the address Bui Tu T, An L Ward, Binh T District (Mai Thanh H1 stored fake drugs therein) and the house in Village R, Thanh P Commune, Ben L District, Long An Province. Here are their testimonies:

Early 2015, Mai Thanh H1 was acquainted with Nguyen Ngoc Kim Suong, in the process of mutual relations, H1 had came to the house of Nguyen Thi Kim H2 at address: Bui Tu T, An L Ward, Binh T District. Seeing that the house has empty space, H1 asked H2 to send some carton boxes there. When being asked reason, H1 claimed that he has printed packages and there was no place to store the carton boxes because his house was crammed of stuff. Therefore, H2 agreed and H1 personally transported products to H2's house. H2 stated that she only let H1 borrow a place to store not leasing or helping him anything else. While H1 delivered the shipment, H2 did not know what products contained inside. H2 only knew that they are counterfeit drugs when the Investigation Body searched her house.

In addition, H1 also borrowed the house that was rented by Nguyen Ngoc Kim S in Thanh T hamlet, Thanh P commune, Ben L district, Long An province, (rented from Trinh Thanh P in the name of Suong). S handed over the house to H1. S was still in the name of the lease contract but H1 fully used the house and H1 would pay the rent to the owner in person. S does not know exactly how the house was used further.

- The Investigation Body summoned designated representatives of drugstores Center for Pharmacy and Medical Equipment Trading and recorded their testimonies. Address: To Hien T, Bac G Tenement, Ward X , District W, Ho Chi Minh City, including: JA drugstore (Khanh H Pharmacy & Health Services Joint Stock Company); JB drugstore (An T Pharmaceutical Co., Ltd); JC Limited (An Kien Pharmaceutical Trade Co., Ltd), MD Limited (Tan T General Trading and Service Joint Stock Company). At the Investigation Body, representatives of pharmacies stated: The above pharmacies are agents for the local pharmaceutical companies, mainly wholesale of drugs. During the operation, the drug store sometimes also has retailed drugs for walk-in customers. With only a few daily retail customers, no customer records or just stating sale to walk-in customers, representatives of pharmacies cannot remember whether they sold medicines to Mai Cong P or Mai Thanh H1, they also did not know nor have business relations with P and H1.

According to the Indictment No. 273/CT-VKS-P3 dated June 30, 2015 of the Ho Chi Minh City People's Procuracy, the defendant Mai Cong P was prosecuted by the Ho Chi Minh City People's Procuracy for "Manufacturing and trading of counterfeit medicines for treatment or prevention of diseases " under Points a and c, Clause 2, Article 157 of the Criminal Code; defendants Mai Thanh H1, Khuu Tuan C and Tran Quang S were prosecuted by the People's Procuracy of Ho Chi Minh City for "Manufacturing of counterfeit medicines for treatment or prevention of diseases " as stipulated in Points a and c of Clause 2 Article 157 of the Criminal Code; defendant Tran Quang B was prosecuted by the People's Procuracy of Ho Chi Minh City for "Manufacturing of counterfeit medicines for treatment or prevention of diseases" under Point a, Clause 2, Article 157 of the Criminal Code in Viet Nam.

At the trial, the defendants admitted their acts as stated the indictment of the Ho Chi Minh City People's Procuracy and requested the Trial Panel to consider extenuating circumstances for mitigation of punishment imposed on the defendants.

The representative of the People's Procuracy of Ho Chi Minh City still upheld the viewpoint of prosecution against the defendants, after analyzing and assessing the nature and seriousness of the offender's crime and the consequences of the case, aggravating and mitigating circumstances, the representative requested the Trial Panel to sentence Mai Cong P to 10 to 12 years’ imprisonment for the crime of "Manufacturing and trading of counterfeit medicines for treatment or prevention of diseases" under Points a and c, Clause 2, Article 157 of the Criminal Code; sentence defendants Mai Thanh H1, Khuu Tuan C, and Tran Quang S 08 to 10 years’ imprisonment on the same charge of "Manufacturing of counterfeit medicines for treatment or prevention of diseases" under Points a and c, Clause 2, Article 157 of the Criminal Code, and sentence the defendant Tran Quang B from 06 to 08 years’ imprisonment for "Manufacturing of counterfeit medicines for treatment or prevention of diseases" under Point a, Clause 2, Article 157 of the Criminal Code. The representative requested Trial Panel to covert the three-year suspended sentence of defendant Mai Thanh H1 to jail term plus a new sentence. As to exhibits, the representative requested the Trial Panel to consider handling them according to the provisions of law.

Based on the documents and evidence gathered in the case file and examined publicly at the trial. After studying and evaluating the general, objective, comprehensive and complete details of the case

CONSIDERING THAT

From March 2016, Mai Cong P and Mai Thanh H1 (P’s biological child) started manufacturing and trading of drugs with counterfeit foreign brands. In addition, P also has hired Khuu Tuan C to work for him. P paid H1 VND 500,000 to 700,000 per work and paid C VND 500 per blister pack.

To manufacture counterfeit drugs, P has personally bought materials and equipment to assemble blister presses, blister cutters. P gave H1 1 blister press, blister cutter placed in Village R, Thanh P Commune, Ben L District, Long An province and gave C 2 blister cutters, 1 blister press, 1 cutter placed at the house: Long D Street, Rach Cat Ben L, Ward B, District Y used to make fake medicines. P also ordered a person called Quy (unknown identity) to print fake packages. Materials used in the manufacturing of counterfeit drugs are medicines made in Vietnam with cheap price, purchased at the drugstores and drug market then removed pills from blister packs to produce counterfeit medicines.

P assigned the production of counterfeit medicines to C, H1 and Tran Quang S by buying medicines made in Vietnam, then removing pills from blister packs and then pressing them in new blisters with foreign brand drugs. When finishing, they will return finished products to P for sale.

At 11 a.m on August 25, 2016, while Mai Thanh H1 was carrying a carton of unknown brand medicines on a motorbike from the house No. 92/44/20 Bui Tu T Street, An L Ward , Binh Tan District to the house in Long D, Rach Cat Ben L, Ward B, District Y to deliver them to Khuu Tuan C, the Police Department of Economic Crime and Corruption Investigation affiliated to Ho Chi Minh City Public Security discovered and made a record of discovery. Subsequently, the Investigation Body affiliated to Ho Chi Minh City Police searched the places where the defendants produced the drugs as mentioned above and obtained a large number of fake medicines together with instruments and equipment to produce drugs.

On September 9, 2016, the Investigation Body affiliated to Ho Chi Minh City Public Security make a request to the Center for Quality Control of Drug, Cosmetics and Food of Ho Chi Minh City for assessment of the above mentioned medicines, specific result:

+ Among the samples of medicines sent for assessment, 06 drugs labeled Neo -Tergynan, Fugacar, Laroscorbine, Di-Ansel, Pharmaton, Vastarel 20mg do not meet quality standards, are fake medicines.

+ Sample of medicine branded Voltaren Retard 50mg: not tested due to lack of quality standards. Verification at the Representative Office of Norvatis Pharma Services AG in Ho Chi Minh City, results of the determination: The above material sample is not a genuine product of the Norvatis Group. The Norvatis Group does not sell a product with trade name Voltaren Retard 50mg worldwide.

+ Samples of medicines labeled Neo-Codion, Alpha Chymotrypsine Choy, Lexomil, Neo-Codion: not tested because there is no reference standard.

The above-mentioned acts of the defendants have committed the crime of "Manufacturing and trading of counterfeit medicines for treatment or prevention of diseases” as prescribed in Article 157 of the Criminal Code.

The behavior of the defendants is dangerous to society, has directly infringed upon the protection of the state, violated the economic management order of state agencies, causing harm to the health of the patients, consumers. The defendants are adults, who have been convicted of counterfeiting pharmaceuticals. They should be aware of the consequences of their offenses, but for illicit gain, they committed the act on purpose. Therefore, the defendants should receive harsh punishments that would deter them from returning into crime and general prevention of the society.

In this case, Mai Cong P was the mastermind who guided remaining defendants to commit offenses. Defendant P personally bought materials and equipment on the assembly of blister presses, blister cutters, directed H1 to remove pill from blister packs and guided C to make fake pharmaceutical drugs, hired Tran Quang B to print packaging, labels, brands of fake medicines, then P carried fake drugs to sell in the provinces. The defendant has committed an organized crime and has had an unspent conviction for a deliberate very serious crime but he repeated the same offence so it is considered dangerous recidivism. This act of the defendant P is guilty of "Manufacturing and trading of counterfeit medicines for treatment or prevention of diseases" under Points a and c, Clause 2, Article 157 of the Criminal Code. As the defendant is the mastermind, the level of punishment imposed on him must be higher than the other defendants in the case.

Mai Thanh H1 received the press, cutting machine from P to make fake drugs. H1 has bought drugs from drugstores in the drug market, then removed pills from blisters and then gave pills and fake drug packages to C to produce counterfeit drugs.

Khuu Tuan C received pills, packages, capsules from P and H1 and then proceeded to press drug blisters, cut blisters, can medicines. Quang S joined in helping C to counterfeit the foreign brand drugs and then handed them over to P.

Tran Quang B received the samples of foreign medicines packages from P and design patterns on the computer and order print molds to print fake packages.

The defendants are guilty of "Manufacturing of counterfeit medicines for treatment or prevention of diseases".  The defendants play roles of accomplices who abetted and manufactured counterfeit drugs for P. Therefore, Clause 2, Article 157 of the Criminal Code must be applied to sanction the defendants.

Also in this case, Mai Thanh H1 has been convicted of a deliberate very serious offense which has not been expunged; Tran Quang S has 03 convictions which have not yet been expunged, so it is considered dangerous recidivism. Therefore, Point c, Clause 2, Article 157 of the Criminal Code must be applied to punish the accused.

Khuu Tuan C was prosecuted by the Ho Chi Minh City People's Procuracy under Point c, Clause 2 of Article 157 of the Criminal Code because the defendant committed a dangerous recidivism. However, the Trial Panel found that:  According to Official Dispatch No. 276/TANDTC-PC in Viet Namon guidelines for the application of some provisions more favorable to offenders of the Criminal Code in 2015, Khuu Tuan C’s conviction has been expunged, the offense this time does not fall under dangerous recidivism. Therefore, it is unnecessary to apply Point c, Clause 2, Article 157 of the Criminal Code to punish the accused.

Mai Thanh H1, 20 August 2012 was sentenced to 3 years’ imprisonment by the People's Court of Ho Chi Minh City gave him a probation period is 05 years from the date of the first instance judgment. However, he has committed another offence during probation period, so the original 3 years’ jail term is immediately applied plus a new sentence.

However, in consideration of other factors, the Trial Panel considers that: at the Investigation Body, the defendants all expressed cooperative attitude and contrition; Tran Quang B does not have prior criminal record or previous administrative violation; Mai Cong P has relieved the consequences of VND 1,800,000, so Points b and p of Clause 1 of Article 46 of the Criminal Code will be applied to reduce a part of the penalty that the defendants should bear.

Le Tong N who has been hired by Mai Cong P to transport counterfeit medicines to the Western provinces did not know that they are fake, so the Investigation Body was grounded when not prosecuting him.

Nguyen Thi Kim H2, Nguyen Ngoc Kim S, Nguyen Kim P are those who let Mai Thanh H1 rent or borrow the houses to manufacture fake medicines. The investigation process identified that H2, S and P did not know whether H1 used the house to produce counterfeit drugs so the Investigation Body was grounded when not prosecuting them.

Regarding Q who has printed packages as well as those who bought counterfeit medicines from Mai Cong P (T1, K, T2, T3 with unknown identity and background), there is no basis for taking actions against them. The Investigation Body is requested to carry out further investigation as per the law.

With reference to exhibits:

- Counterfeit medicines needed to be destroyed.

- Cutting machines, presses needed to confiscate.

- The amount of VND 1,800,000 paid by Mai Cong P for relieving the consequences needed to confiscate to the state fund.

Based on above-mentioned facts and matters,

HEREBY DECIDES

Announce that Mai Cong P is guilty of “Manufacturing and trading of counterfeit medicines for treatment or prevention of diseases”

Mai Thanh H1, Khuu Tuan C, Tran Quang S and Tran Quang B are guilty of "Manufacturing of counterfeit medicines for treatment or prevention of diseases".

1/ Pursuant to Points a, c Clause 2 Article 157; Point b, p Clause 1 Article 46 of the Criminal Code.

Mai Cong P is sentenced to 11 years’ imprisonment. The prison term is from August 25, 2016.

2/ Pursuant to Points a, c Clause 2 Article 157; Point p Clause 1 Article 46; Article 51, Clause 5 Article 60 of the Criminal Code:

Mai Thanh H1 is sentenced to 8 years’ imprisonment. Combined with the 3 years’ imprisonment of the Verdict No. 272/2012/HSST dated August 20, 2012 of the People's Court of Ho Chi Minh City, forcing the Mai Thanh H1 to serve a sentence of 11 years in prison. The prison term is from August 25, 2016.

3/ Pursuant to Points a Clause 2 Article 157; Point p Clause 1 Article 46 of the Criminal Code.

Khuu Tuan C is sentenced to 8 years' imprisonment. The prison term is from August 25, 2016.

4/ Pursuant to Points a,c Clause 2 Article 157; Point p Clause 1 Article 46 of the Criminal Code.

Tran Quang S is sentenced to 7 years' imprisonment. The prison term is from August 25, 2016.

5/ Pursuant to Points a Clause 2 Article 157; Point p Clause 1 Article 46 of the Criminal Code.

Tran Quang B is sentenced to 5 years' imprisonment. The prison term is from August 25, 2016.

Pursuant to Article 41 of the Criminal Code, Article 76 of the Criminal Procedure Code in Viet Nam:

The sum of VND 1,800,000 VND is confisticated to the state fund (according to the Receipt of advance payment of court fees and charges dated July 24, 1977 by the Department of Civil Judgment Enforcement of Ho Chi Minh City)

The following exhibits shall be confisticated:

-   1 press machine

-    1 cutting machine as stated in the record of handover of exhibits No. 297/17 dated July 21, 2017 of Department of Civil Judgment Enforcement of Ho Chi Minh City)

+ 1 used Samsung mobile phone with IMEI number 352700/07/806845/8; 1 white used Ipad; 1 used Dell CPU; 01 used ASUS laptop (located in 45 (forty five) cartons and 1 (one) sealed nylon bag signed by the involved parties dated August 26, 2016)

 (According to Minutes of unsealing seized documents and objects made at 10:00 am on December 2, 2016 at Investigation Body affiliated to Ho Chi Minh City Public Security and Minutes of handover of exhibits No. 297/17 dated July 21, 2017 of the Department of Civil Judgment Enforcement of Ho Chi Minh City)

Confiscation for destruction:  all goods in 45 (forty five) cartons and 1 (one) of sealed nylon bag signed by the involved parties dated August 26, 2016 containing:  25 kg capsule labeled IBUPARAVIC sealed in 1 carton signed by Mai Thanh H1 dated December 2, 2016.

Each defendant has to pay a court fee of VND 200,000.

The defendants, persons with related rights and obligations shall have the right to appeal within 15 days from the date of pronouncement of the verdict.


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Judgment No. 350/2017/HSST dated September 19, 2017 regarding manufacturing and trading of counterfeit medicines for treatment or prevention of diseases

Số hiệu:350/2017/HSST
Cấp xét xử:Sơ thẩm
Agency issued: Tòa án nhân dân Hồ Chí Minh
Field:Hình sự
Date issued: 19/09/2017
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