David Blech, the long-dethroned "King of Biotech," will spend the next three years in a low-security prison in Fort Dix, NJ, after a federal appeals court tossed out claims that the judge presiding over his case had been biased against him.
The once enormously wealthy biotech investor--who helped start Celgene ($CELG), Alexion ($ALXN), Ariad ($ARIA) and Icos as he wore the crown unofficially handed to him by his admirers--tried hard to wrestle out of a four-year prison sentence for his second conviction on securities fraud. As he did the first time around, Blech pleaded that he was bipolar and that his mental ailment had pushed him further and further down the wrong road. Along the way a biotech fortune that once earned him entry to Forbes' list of the 400 richest Americans was frittered away, leaving a few long-shot gambles on biotech companies on the table as he made the trip to prison.
But while Blech managed to get off with probation for his first conviction, there was no way out for the second go-round on charges that he manipulated the stock price of two biotech companies.
Blech based his appeal on some remarks made by his judge, Colleen McMahon, who noted that "we let people like you get away with things that we don't let poor black drug addicts" get away with, according to Reuters. But the appeals court concluded that while some of the remarks may have been ill-conceived, they didn't mean that Blech--who is white and Jewish--had been unconstitutionally sentenced based on race.
At the time he went to prison, Blech was holding on to a stake in a penny stock company, Intellect Neurosciences, an OTC biotech valued at a little more than $1 million. He was also millions of dollars in debt, looking for one more big score to get him out of his financial bind.
- here's the story from Reuters
NYT: Blech says he could have been a biotech billionaire
Biotech financier Blech gets jail time in 'No mercy' sentence
Biotech 'gambler' Blech loses big in securities scam