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History and Science
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History and Science: In the world of biotechnology, where sterling scientific credentials are critical to winning investor confidence, Samuel Waksal' s bona fides seemed impeccable: a string of research positions at such prestigious institutions as Stanford and Tufts universities and the National Cancer Institute. His decade-long academic career lent credibility to ImClone Systems Inc., the biotechnology company he founded in 1985, and to the dozen other scientific ventures he says he has helped start since then. Missing from Dr. Waksal ' s official resume is that he was pushed out of each of those research institutions for what former supervisors and others say was misleading and, in one case, falsified scientific work. ImClone's board forced him out of the company in May because of directors' increasing anxiety about his truthfulness and legal problems, according to people close to the board. Once celebrated as a brilliant immunologist on the verge of launching a revolutionary cancer treatment, Dr. Waksal, 55 years old, stands accused by federal prosecutors of insider trading, his career seemingly in ruins. In December, when he learned regulators would soon turn away his company's cancer-drug application, he allegedly tipped off family members who owned ImClone stock and tried to sell his own shares. One of Dr. Waksal ' s high-profile friends, home-products executive Martha Stewart, is also under investigation for her sale of ImClone stock in December. Dr. Waksal faces additional charges of perjury, obstruction of justice and bank fraud. Dr. Waksal has pleaded not guilty and denied all of the allegations. His lawyers have portrayed him as "an accomplished scientist and researcher" who is the victim of circumstantial evidence. The lawyers are negotiating with prosecutors over a potential plea deal that would include a prison term of fewer than the seven to 10 years that the government initially threatened and leniency for his family. After repeated attempts were made to obtain comment from Dr. Waksal for this article, a spokesman said yesterday he was unavailable. ImClone's stock price has fallen to less than $9 a share from more than $75 in December, just before Dr. Waksal ' s world began to fall apart. And the trials of ImClone's cancer drug Erbitux -- the object of intense hope by legions of cancer patients -- are now in disarray. Dr. Waksal says in his resume that he has published more than 50 scientific papers over the years. But by many accounts, his rise in academia and industry stemmed from an unusual ability to talk conceptually about cutting-edge science and an uncanny power of persuasion. "Every 100 years, someone like him is born," says Robert Schwartz, a hematologist who supervised Dr. Waksal at Tufts University School of Medicine in the late 1970s and now is a deputy editor of the New England Journal of Medicine. "He's a very persuasive person who can convince you of anything," Dr. Schwartz adds. "Within five minutes, you're begging him to work for you." That Dr. Waksal was able to land a series of prestigious positions, despite his dubious record, illustrates a broader problem: Tainted scientists can move from job to job without bosses taking aggressive action to derail them. The fear is that a researcher tarred by a negative job review will sue for defamation, says William Terry, former head of the immunology branch of the National Cancer Institute at the National Institutes of Health. He hired Dr. Waksal for a temporary research position in 1975 and later decided not to retain him. "Institutionally, we're under the gun to do no more than give [a prospective future employer] the most basic information. It sets up a situation where the bad eggs can move from one place to another with great facility." Born in Paris to parents who were Holocaust survivors, Dr. Waksal moved with his family in the early 1950s to Dayton, Ohio, where his father went into the scrap-metal business. Young Sam excelled academically, married his high-school sweetheart and went to college and graduate school at Ohio State University. Even as a graduate student in immunobiology in the early 1970s, he caught the attention of top researchers. "We were all struck by the extremely bright graduate student," says Irv Weissman, a Stanford professor who met Waksal during a visit to the Ohio State lab where the younger man worked. In 1974, after a brief stint as a post-doctoral fellow at a scientific institute in Israel, Dr. Waksal landed a choice job at Stanford University, with Dr. Weissman's help. At Stanford, Dr. Waksal worked in the lab of Leonard Herzenberg, a prominent scientist who invented a widely used machine for analyzing and sorting blood cells. Dr. Herzenberg recalls his employee as "an absolute charmer" who at first struck him as having "a great scientific mind. Sam is absolutely brilliant." But after a series of strange events, Dr. Herzenberg and his scientist wife, Lee, concluded that the young researcher had misled them. Soon after arriving, Dr. Waksal boasted that for research purposes he had obtained a supply of difficult-to-produce antibodies, which are proteins that fight foreign matter in the body. Dr. Waksal said he got the antibodies from the lab of another well-known scientist, Edward Boyse of the Sloan-Kettering Institute, in New York. Dr. Herzenberg says he asked Dr. Waksal to share the material with another young researcher who had produced promising results in an experiment using other antibodies. Using Dr. Waksal ' s antibodies, the other researcher couldn't reproduce his earlier results, Dr. Herzenberg recalls. Then, a lab technician reported finding the remainder of the Waksal antibodies spilled in a refrigerator, making it impossible to test them further. "I became suspicious," Dr. Herzenberg says. He questioned Dr. Waksal about the origin of the antibodies. "He said they'd been sent to his home at Ohio State and [added], `I've got the brown wrapper to prove it.' I said, `Show me the wrapper,'" Dr. Herzenberg recounts. Dr. Waksal couldn't produce the wrapper, Dr. Herzenberg says. Dr. Herzenberg says he called Dr. Boyse, who told him he had not provided any antibodies to Dr. Waksal. Dr. Boyse and his wife, Judith Bard, say their records show that their lab did ship Dr. Waksal a batch of antibodies, but four years later, in 1978, after he had left Stanford. Convinced Dr. Waksal had made up the entire story, Dr. Herzenberg says he asked the younger man to leave his lab later in 1974. Some time later, Lee Herzenberg recalls, Dr. Waksal called and apologized to her. "He called to say he really didn't mean anything bad by anything he'd done, and he wanted to be friends. He said the story about the wrapper was not true," Lee Herzenberg says. She adds that Dr. Waksal told her he was seeking psychiatric help and had changed. Dr. Waksal made arrangements to move to the National Cancer Institute near Washington. Dr. Herzenberg says he warned Dr. Terry of the NCI about the strange experience with the antibodies. But Dr. Herzenberg says he learned that Dr. Waksal denied there had been any problem at Stanford, and Dr. Terry went ahead with the hiring. Dr. Terry says he doesn't recall such a conversation with Dr. Herzenberg and suggests that the Stanford scientist may have spoken to someone else at the NCI. Dr. Terry says he can't remember whom he talked to about Dr. Waksal before hiring him, but he says he probably went to scientists at Ohio State who knew the applicant from his student days. Dr. Terry remembers Dr. Waksal as "extremely bright, articulate and personable, with a breadth of knowledge on immunology literature." But after Dr. Waksal had held a temporary research post at the NCI for about three years, Dr. Terry says he decided against offering the younger man a permanent job, effectively forcing him to leave. The reason was a disturbing pattern in Dr. Waksal's research. Dr. Waksal was involved in a large number of projects with other scientists, recalls Dr. Terry. "When the critical time came to deliver his part of the collaboration, there would be a catastrophe of some sort -- a tissue culture would become contaminated or the mice would develop an infection and have to be killed," Dr. Terry says. In 1977, Dr. Waksal moved to Tufts to work for Dr. Schwartz, the hematologist, whom he had met at a conference. Dr. Terry says he relayed general negative impressions of Dr. Waksal to Dr. Schwartz, even though under the NCI's policy, he was supposed to affirm only that Dr. Waksal had worked there and state the years of his employment. "The fact that I was not prepared to keep him on was known by Bob Schwartz," Dr. Terry says. Dr. Schwartz says he doesn't remember such a conversation with Dr. Terry. Dr. Schwartz says that in hiring Dr. Waksal, he relied principally on strong recommendations from two senior scientists who had supervised the younger man during his research in Israel. Dr. Schwartz recalls that Dr. Waksal had an almost hypnotic effect on him and that he was eager to have him work in his lab. But Dr. Schwartz says he grew suspicious of Dr. Waksal in the late 1970s, after bumping into Wallace Rowe, a virologist who had worked at the National Cancer Institute at the time Dr. Waksal was employed there. "He told me, `Watch out for Waksal,'" Dr. Schwartz recalls. The warning, he adds, was like "cold water in my face." Suddenly he began to see a pattern to Dr. Waksal ' s behavior. "He would tell people the results of experiments [he] never carried out," Dr. Schwartz says. In one case, Dr. Schwartz remembers Dr. Waksal saying he had bred a particular type of mouse for use in experiments. After waiting for a long period to see the mice, Dr. Schwartz says, he finally sent a technician to the breeding room to find them. The technician never found them, and Dr. Schwartz says he concluded "that such a mouse never existed." Dr. Waksal, he adds, "had an extra gift of creating an illusion." Henry Wortis, a Tufts immunology professor, says he talked often with Dr. Waksal, and he, too, was bowled over by his "imagination, creativity and far-ranging knowledge." But much like Dr. Schwartz, Dr. Wortis began to have questions about Dr. Waksal ' s research. He seemed to have "difficulties in getting the experiments he participated in done in a timely fashion," Dr. Wortis says. In one collaboration, Dr. Waksal was supposed to produce some cell lines for experiments, but he never provided them, Dr. Wortis says. In 1981, Dr. Waksal ' s brother, Harlan, then a medical resident at Tufts, was arrested and charged with possessing cocaine with intent to distribute. Harlan Waksal, now 49, and chief executive of ImClone, was convicted of cocaine possession the next year in federal court in Miami, Fla., but an appeals court threw out the verdict after finding he had been illegally searched. Around the time of the arrest, Dr. Schwartz says, the chairman of the department of medicine at Tufts-New England Medical Center, Sheldon Wolff, complained to him that Sam Waksal, who is not a medical doctor, had covered for his brother by seeing patients at the center. Dr. Wolff has since died. Harlan Waksal declined to comment. "All of these problems put together made me decide [Sam] Waksal had to go," Dr. Schwartz says. He recalls telling Sam Waksal, "I want you out." Sam Waksal has said in the past that he visited one of his brother's patients but did so only to chat with her. In 1982, Dr. Waksal landed at Mount Sinai School of Medicine in New York. He was hired to run an immunology lab by Jerome Kleinerman, the chairman of the pathology department. Dr. Kleinerman has since died. Dr. Schwartz of Tufts says that he didn't warn anyone at Mount Sinai about Dr. Waksal because no one called to ask his opinion. Later, after problems developed at the New York school, Dr. Schwartz recalls that "the man who hired and fired him [at Mount Sinai] called to complain. I said, `Sir, you never asked for a recommendation.'" At Mount Sinai, Alexandra Bona, a scientist who worked for Dr. Waksal as an assistant professor, says he was friendly and charming. They had lunch twice. "He was young, tall, well dressed," she says. He had good taste, and his office was fashionably decorated, which was unusual at the school, she says. But one day in 1985, the Waksal lab imploded, she recalls. Returning from lunch, Dr. Bona found "everyone crying and Sam was out of his mind." He and a few technicians had been asked to leave immediately, she says. The circumstances of his departure were kept secret from her, she says, and she never learned for certain what had happened. Mount Sinai says it can only confirm that Dr. Waksal worked in the pathology department in the early 1980s. His file is legally sealed under a confidentiality agreement he reached with Mount Sinai. But a person familiar with the situation says Mount Sinai asked Dr. Waksal to leave because of evidence he had falsified data. Dr. Bona's husband, Constantin Bona, an immunologist and professor at Mount Sinai, says that before the ouster, he had identified a problem with a paper Dr. Waksal had submitted for publication in a scientific journal. Constantin Bona says Sherman Kupfer, then Mount Sinai's senior vice president of research, had asked him and others to review the paper. "I looked at the results. There were discrepancies," Constantin Bona says. "The results in the end were not the same as the lab books." Dr. Kupfer confirms that Mount Sinai viewed the discrepancies in the Waksal paper as a serious breach. "Is it lying? Not necessarily. But no scientist will accept it as significant proof of a hypothesis," he says. "It's viewed as misconduct and is dealt with severely." Dr. Waksal has said in the past that he had some disputes with people at Mount Sinai but denied he was forced out. The year that he left Mount Sinai, 1985, Dr. Waksal founded ImClone to develop new vaccines, among other things. His brother, Harlan, soon joined him as second-in-command at the company. They set up shop in an office building in Manhattan's SoHo district, buying a long-term lease from a bankrupt shoe manufacturer. The company, which went public in 1991, struggled until Dr. Waksal met John Mendelsohn, then the chairman of medicine at Memorial Sloan-Kettering Cancer Center. Dr. Mendelsohn, who is now president of M.D. Anderson Cancer Center in Houston, had discovered a potential cancer drug and was searching for a company to bring it to market. Where others were skeptical, he says, Dr. Waksal instantly recognized the potential. "Sam said, `I want that molecule,'" Dr. Mendelsohn, now on ImClone's board, recalls. The drug, Erbitux, became ImClone's leading prospect. Top researchers in the country began experimenting with it and reported encouraging results. Many cancer patients began to pin their hopes on Erbitux being approved for general use. By all external appearances, Dr. Waksal had made it big. He counted among his friends and business partners Ms. Stewart and financier Carl Icahn, both of whom invested in ImClone. He became chairman of the New York Council for the Humanities and hosted monthly soirees in his swank Soho loft, where guests were invited to discuss current issues of intellectual interest. Attendees included actress Lorraine Bracco and Stephen Gould, the scientist and author, who has since died. Mick Jagger once performed at a Waksal party. While living a lavish lifestyle, Dr. Waksal was borrowing heavily from his companies. In the early 1990s, he borrowed about $300,000 from ImClone, which had just gone public but had no products and little revenue. He paid back the money. Two years later, when ImClone was almost insolvent, he borrowed $225,000 from another small company he helped start, Merlin Pharmaceutical Corp. He served as chief executive of Merlin. In 1996, after Merlin had merged with another biotech firm, Somatix Therapy Corp., he still owed the combined company about $200,000, according to Somatix filings with the Securities and Exchange Commission. Dr. Waksal served on Somatix's board. The next year, another firm, Cell Genesys Inc., took over Somatix. Dr. Waksal ' s loan doesn't appear on any Cell Genesys filings with the SEC. Cell Genesys declined to say whether he repaid the loan. Later in the 1990s, encouraging Erbitux test results attracted keen investor interest. In his crowning business achievement, Dr. Waksal persuaded drug giant Bristol-Myers Squibb Co. to invest $2 billion in ImClone in September 2001. In return, Bristol-Myers received some rights to market Erbitux. While he was negotiating with Bristol-Myers in the summer of 2001, Dr. Waksal borrowed $18 million from ImClone, with which he bought more of the company's stock and increased the worth of his ImClone stake to more than $200 million. As a result of the unconventional deal with Bristol-Myers, he was able to sell ImClone stock worth $57 million last fall. It couldn't be determined what profit he enjoyed on the sale. When the Food and Drug Administration took the unusual step of refusing last December even to review Erbitux, the agency cited significant problems with the design and execution of ImClone's pivotal trial of the drug. A Bristol-Myers scientist told a House subcommittee in June that its review of ImClone's data last year indicated there was some missing evidence on 11 of the 27 patients for whom ImClone had reported positive outcomes. Bristol-Myers and ImClone are still working to get Erbitux approved. In January, securities regulators began reviewing trading in ImClone shares in the days before the FDA decision was announced in late December. Investigators looked into trades by Waksal family members and certain friends, including Ms. Stewart. Brokers declined to process Dr. Waksal ' s trades, so he wasn't able to sell before the FDA announcement, according to prosecutors. His family members sold stock valued at a total of about $10 million. Ms. Stewart sold stock valued at about $230,000. All concerned have denied they did anything improper. In a March 4 meeting, lawyers for ImClone's outside directors discussed with them an allegation that Dr. Waksal had signed the corporation counsel's signature on a Bank of America Corp. document in connection with a personal loan, according to people close to the board. Later that month, the lawyers told the outside directors that Dr. Waksal had refused to testify before the SEC, contrary to his promise to cooperate fully with all investigations, the people close to the board say. The outside directors decided to ask him to resign, according to the people close to the board. In the following days, Dr. Waksal persuaded the board -- the Waksal brothers, plus the 10 outside directors -- to let him keep his job by promising he would now testify before the SEC, according to the people close to the board. But two months later, on May 21, after learning that the SEC staff had recommended filing a civil fraud lawsuit against Dr. Waksal, the ImClone board pushed him out. The board agreed to give him a $7 million compensation package on his way out the door. But ImClone has since sued Dr. Waksal in state court in New York to get the money back. In the suit, the board accuses him of making "deliberately false and misleading statements to the company," indicating he was cooperating with federal investigators. Instead, the suit says, he was destroying documents and computer records, which he has denied. On the morning of June 12, Dr. Waksal was awakened by federal agents who, fearing he might flee, blocked the potential escape routes from his apartment. Once inside his loft, the agents arrested him. In August, a federal grand jury indicted Dr. Waksal on the charges of insider-trading, perjury, obstruction of justice and bank fraud. Resume Questions |
