Scandal-Ridden Proove Biosciences Sells Assets, Founder and CEO Exits Amid Allegations

September 1, 2017
By Alex Keown, BioSpace.com Breaking News Staff

IRVINE, Calif. – Amid scandal and questions about the promise of its products, Proove Biosciences is now up for a “restructuring and asset sale.”

In an interview with Stat News, Proove’s founder Brian Meshkin said the company’s sale has been directed by the courts. Meshkin also made it clear that he was no longer employed as the company’s chief executive officer. It was unclear if how his departure came about.

His downfall was predicated by a series of articles Stat ran questioning the company’s genetic tests. The company claimed the tests could predict if an individual was likely to become addicted to opioids. In May, the company released a study indicating its risk-assessment test has a 97 percent accuracy rate.

Not only did Stat’s articles raise questions about the promise of the test, but the reports also described a company culture that was both unethical and possibly illegal. The articles suggest that the company coerced patients into taking unnecessary genetic tests. Citing medical and legal experts, Stat said Proove and its team of doctors may have operated in “in ways that could violate federal and state anti-kickback laws, which are meant to prevent unneeded testing.” The genetic tests were ordered by doctors who “were promised ‘research fees’ in exchange for participating in the company’s clinical studies. Many doctors enrolled their patients in studies, but were never paid.” The publication received information from former Proove employees who said the company had representatives in private medical practices who “coerced patients to take unneeded tests for sensitivity to opioids or opioid abuse in an effort to boost company revenues.” Those employees also said the company allegedly falsified report data to make it appear as if those patients benefited from the testing.

In his interview, Meshkin pointed to peer reviewed data, such as the May release, to validate the company’s research. He said his product was an effective tool in the fight against rising opioid addiction in the United States. Stat said there are questions about the test accuracy and efficacy, nothing that Eric Fung, Proove’s former chief scientific officer, and Daniel A. Schwarz, Proove’s former research and development director, have disavowed the tests.

Questions of possible fraud at the company caused agents from the FBI to raid the California offices of Proove in June of this year. Federal agents left the building with boxes of documents, but no arrests were made, according to the Los Angeles Times.

For Meshkin, his departure from the company was squarely on the shoulders of Stat News. In his interview with that publication, he called their reports “erroneous and damaging.” He said the “false allegations” were based on reports from disgruntled employees. He was confident the company’s mission would endure.

The company’s restructuring plan was initiated by its main creditor, Mike Leavitt, the former governor of Utah, Stat said, citing Meshkin.