ImClone founder enters prison
By Michael Rubinkam
Associated Press
MINERSVILLE, Pa. — Sam Waksal, the biotech executive caught in the insider-trading scandal that threatens Martha Stewart, reported to a federal minimum-security prison yesterday to begin serving a sentence of more than seven years.
Waksal, founder of ImClone Systems Inc., becomes the first CEO to do time in the recent wave of corporate scandals.
"I deeply regret the mistakes I've made that have brought me here today, and I'm ready to pay for those mistakes," the scientist-founder of ImClone Systems Inc. said after arriving in a Range Rover at the Schuylkill Federal Correctional Institution in eastern Pennsylvania.
The 55-year-old scientist pleaded guilty last fall to securities fraud for tipping his daughter to dump ImClone stock because the government was about to announce bad news about the company's key cancer drug, Erbitux. A federal judge also fined him $4.3 million.
He arrived at the prison in blue jeans, white sneakers and a blazer.
Waksal will be one of about 300 inmates at the prison in Minersville, 75 miles northwest of Philadelphia.
Federal Bureau of Prisons spokeswoman Traci Billingsley said Waksal would be strip-searched, have his possessions inventoried, undergo medical and psychological screening, and report to his unit for a bunk assignment.
Many prisoners work 7 1/2 hours each day, five days a week, scrubbing floors and cutting grass for pay ranging from 16 cents to 40 cents per hour.
"I only hope that right now I can go on and continue contributing after this in a positive way for society, in the kinds of ways that help bring Erbitux to people," Waksal said as he arrived.
Waksal pleaded guilty last year to charges including securities fraud and perjury. He later admitted to dodging more than $1 million in sales tax on nine paintings that he bought from a Manhattan gallery.
Stewart was indicted June 4 on conspiracy and obstruction-of-justice charges. Prosecutors said the home-entertaining expert dumped her own ImClone stock after she had been tipped that the Waksals were selling, then lied about it to investigators.
She pleaded not guilty and has mounted a public defense, including a Web site that is updated daily with new support letters from fans.
Stewart's ex-stockbroker, Peter Bacanovic, also was indicted and has pleaded not guilty.
ImClone said in June it would reapply to the Food and Drug Administration for approval of Erbitux after recently released data found the drug effective in shrinking tumors of some colon cancer patients.
