Jia Bei Zhu, the now-identified operator of the secret Reedley biologics lab, was arrested on Thursday by federal authorities for manufacturing and distributing misbranded medical devices and for making false statements to the Food and Drug Administration.
Zhu, a Chinese citizen who formerly lived in Clovis, faces several years in prison.
Driving the news: According to a criminal complaint filed in the U.S. District Court for the Eastern District of California, Zhu manufactured, imported, sold and distributed thousands of COVID-19 test kits and other test kits through the companies Universal Meditech Inc. and Prestige Biotech Inc.
- Along with the COVID-19 test kits, Zhu distributed test kits for HIV, pregnancy, clinical urinalysis and others throughout the United States and China.
- Court documents reveal that Zhu did not obtain the required authorizations to manufacture and distribute the test kits and mislabeled some of them.
- Federal authorities accuse Zhu of making false statements to the FDA about his identity, his ownership and control of Universal Meditech and Prestige Biotech and the activities of the two companies.
- Zhu has three aliases: Jesse Zhu, Qiang He and David He.
The backstory: Zhu’s clandestine operation came to light when Reedley Code Enforcement officers investigated a garden hose sticking out of the side of a warehouse in the city, leading to the Fresno County Department of Public Health, the Federal Bureau of Investigation and other agencies to investigate.
- Investigators found nearly 1,000 genetically engineered mice, COVID-19 test kits, pregnancy test kits and various viral agents such as malaria and HIV stored in the warehouse.
- Zhu’s true identity had remained in the dark up until this point, although he had communicated with the Fresno County Department of Public Health under the alias David He.
- Government officials obtained Zhu’s fingerprints when he entered the United States seven times from 2003 to 2008, confirming that he is a citizen of China. He also entered the U.S. from China in 2021, identifying himself as Qiang He and obtained an employment authorization card issued by the United States Citizen and Immigration Services.
- Court documents show that Zhu owned Canadian company IND Diagnostic Incorporated and was sued civilly in Canada and ordered to pay over $300 million for misappropriating technology related to the separation of sex chromosomes from bull semen.
Not authorized: While Universal Meditech, under the control of Zhu, first registered as a medical device manufacturer with the FDA in November 2015, that registration lapsed in 2022, meaning the company is not permitted to manufacture or import any in vitro diagnostic test kits in the United States.
- Universal Meditech’s attorney told FDA officials in November 2022 that the company had gone out of business and sold its assets to Prestige Biotech, which was never registered with the FDA to manufacture or import any in vitro diagnostic test kits and had never received Emergency Use Authorization to manufacture and distribute COVID-19 test kits.
- Universal Meditech had applied for Emergency Use Authorization for its COVID-19 test kits but did not receive it because of major deficiencies in its test studies.
- Court documents show that any test kits produced by Zhu’s companies would be considered misbranded medical devices.
Lying to the feds: The criminal complaint also accuses Zhu of making several false statements to the FDA, including that his name was Qiang “David” He.
- Zhu told the FDA that he was hired by Universal Meditech as a COVID-19 consultant in 2021 and that he had been recently hired by Prestige Biotech to communicate with government agencies and dispose of property at the Reedley warehouse. He also told the FDA that he did not know anything about the manufacturing or distribution histories for the two companies, including a shipment of 47,500 pregnancy test kits from China to Universal Meditech at an address in Las Vegas.
What we’re watching: Zhu faces a maximum penalty of three years in prison for the misbranding of medical devices and five additional years for making false statements, if convicted.
- Last week Universal Meditech filed a claim with Fresno County for $50 million in damages for the destruction of assets at the Reedley warehouse.
What they’re saying: U.S. Attorney Phillip Talbert said in a press release that Zhu was trying to avoid public scrutiny of his operations.
- “As part of his scheme, the defendant changed his name, the names of his companies, and their locations,” Talbert said. “The disarray at the Reedley lab led to the glare of publicity he was trying to avoid, and the ensuing investigation unraveled his efforts to circumvent the requirements that are designed to ensure that medical devices are safe and effective.”
Read the complaint: