Dr. Kristian Rhein, longtime racetrack veterinarian, entered a guilty plea Aug. 3 to one felony count of drug adulteration and misbranding in U.S. District Court. Rhein told Judge Mary Kay Vyskocil that he marketed and sold adulterated and misbranded drugs, specifically SGF-1000, to trainers for the purpose of enhancing performance. Rhein also admitted that he modified veterinary records to conceal administration of SGF-1000, as well as the administration of clenbuterol, which he said was not always given with a valid prescription.
As part of his plea agreement with prosecutors, Rhein has agreed to forfeit $1,021,800 of the proceeds he generated from the illegal drug sales, and to further pay over $700,000 in restitution to the victims of his crimes. Prosecutors did not specify who the victims would be for the purposes of restitution, only that a sealed list would be filed along with sentencing recommendations. Vyskocil also clarified with prosecutors that the restitution amount owed by Rhein could lessen if additional defendants are found or plead guilty.
Sentencing will take place at a later date, but the charge Rhein pleaded to carries a maximum recommended prison sentence of three years, with an additional possible sentence of one year of supervised probation. Vyskocil made clear to Rhein that she could decide to impose a higher sentence if she chose. Rhein could also face fines of $10,000, twice the gross gain of his scheme, or twice the losses to others as the result of his crimes, whichever amount is greatest.
Rhein specifically mentioned that he conspired with trainer Jason Servis to administer and conceal the administration of SGF-1000. Prosecutors revealed they had evidence collected from wire taps stating that SGF-1000 was untestable and demonstrating that trainers described anecdotal impacts of the drug on their horses' performance. Further, prosecutors had archived information showing that after drug makers realized there was regulatory scrutiny of SGF-1000, they changed their marketing to stop referring to it as a performance enhancer and vasodilator, and to begin referring to it as a homeopathic treatment. Prior to this change, the drug was also advertised to contain various growth factors, but that was also modified to evade scrutiny.
Read more about the evolution in the marketing of SGF-1000 in this Paulick Report feature published during the week of the indictments.
Intercepted phone calls also allegedly contain discussions between Rhein and others about SGF-1000 being undetectable on post-race drug testing. Indeed, prosecutors say, based on the evidence they collected about the drug's use, it was not showing up on post-race tests.
Prosecutors also revealed they had evidence showing the shipment of SGF-1000 from an overseas manufacturer to MediVet Equine, a Nicholasville, Ky.-based company which claimed to be the originator of SGF-1000. Michael Kegley, Jr., former director of sales for MediVet Equine, changed his plea to guilty in late July 2021.
Also during Tuesday's hearing, prosecutors revealed they believed between $26 and $65 million in purses was collected by Servis while using drugs given by Rhein on their horses. They did not specify which horses or which races they were referring to. Rhein stated that the dates of his drug adulteration and misbranding stretched from December 2016 until March 2020.
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