Region Roundup
Cancer drug developer acquires Massachusetts company
Progenics Pharmaceuticals Inc. in Greenburgh has acquired Molecular Insight Pharmaceuticals Inc., a clinical-stage private biotechnology company headquartered in Cambridge, Mass., in an all-stock transaction. Progenics, a developer of drugs used in the treatment of cancer and related conditions, acquired all of Molecular Insight’s capital stock in exchange for 4,566,210 shares of Progenics common stock, which amounts to 8.9 percent of outstanding company shares after the acquisition. Progenics also agreed to payments in cash or Progenics stock of up to $23 million to Molecular Insight’s former owners for reaching certain drug commercialization milestones and up to $70 million for reaching specified sales targets for all Molecular Insight products. Progenics officials in a press release said the acquired company has a drug pipeline of targeted radiotherapy and molecular imaging compounds aimed at enhancing treatment of prostate cancer and other cancers. “This is a pivotal moment for Progenics as we advance our plan to become a preeminent oncology company,” said Progenics CEO Mark R. Baker. “Molecular Insight’s innovative small molecule compounds are an excellent complement to our internally developed oncology programs. This acquisition broadens our oncology pipeline, adding late-stage opportunities and targeting additional types of cancer while deepening our strategic focus on the PSMA (prostatespecific membrane) antigen, which shows great promise as an oncology target.” Headquartered at 777 Old Saw Mill River Road on The Landmark at Eastview campus, Progenics Pharmaceuticals to date has developed one commercial product, Relistor, a drug injected in terminally ill cancer patients to treat constipation caused by opioid painkillers. The company last fall cut more than one-fourth of its workforce and ended several research projects after the U.S. Food and Drug Administration (FDA) withheld its expected approval and requested more clinical data for Relistor’s longer-term use to treat the same condition in patients with chronic pain not caused by cancer. The FDA response held up an expected $40 million milestone payment to Progenics from Salix Pharmaceuticals Ltd., which markets and is further developing Relistor. Progenics in December reported netting about $23.3 million from a public offering of 12.65 million shares of common stock priced
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January 28, 2013 • WCBJ • HV Biz
at $2 a share. Progenics stock closed at $2.95 a share in NASDAQ trading on Jan. 23. Over the past year, the biotech stock sold at a high of $11.34 per share in April and dropped to a low of $1.42 per share in November.
Rockland Ponzi schemer gets prison term
A Rockland County accountant was sentenced Jan. 16 to three years in federal prison for operating a $6 million Ponzi scheme over 11 years. Alan Ritter, a 70-year-old self-employed accountant in Monsey, in September pleaded guilty in a Manhattan federal court to three counts of wire fraud. Ritter admitted soliciting loans from friends and clients to cover more than $500,000 in losses in a business venture in 2001 and falsely telling them the money would be used for real estate investments. Until his arrest last year, he continued to borrow money for purported business ventures but instead used the funds to pay interest on his original loans and for his personal expenses. Ritter also embezzled funds entrusted to him by several clients to cover interest payments on his Ponzi scheme loans and for personal expenses. Preet Bharara, U.S. attorney in Manhattan, when announcing the sentence said Ritter “like other Ponzi schemers before him added personal betrayal to his fraud by fleecing unsuspecting victims who were friends and clients.” The accountant also was sentenced to three years of supervised release and ordered to pay restitution and forfeiture, the amount of which will be later determined.
Hudson Valley men charged in Mafia waste-hauling racket
Seven Westchester County residents – including a recently retired state trooper and owners of a Peekskill carting business – were among 29 persons indicted Jan. 16 on federal charges for their alleged roles in organized crime’s continued control of the commercial waste-hauling industry in the New York metropolitan area. Two Rockland County men and one Putnam County resident also were named in the indictment announced by U.S. Attorney Preet Bharara of the Southern District of New York. The arrests followed a multiyear investigation by Federal Bureau of Investigation agents and Westchester County and New York City police. Twelve defendants were charged under the Racketeer Influenced and Corrupt Organizations Act (RICO) for conspiring to participate in a racketeering enterprise that asserted illegal and extortionate control over commercial waste-hauling companies in New York and New Jersey. Other defendants were charged with
individual criminal acts that included loansharking, mail and wire fraud conspiracy and interstate transportation of stolen property. Bharara said the dozen defendants facing racketeering charges are members and associates of three organized crime families of La Cosa Nostra – the Genovese, Gambino and Luchese families. Those indicted from Westchester include Joseph Sarcinella, 78, Greenburgh, charged with RICO conspiracy; Pasquale Carbone Sr., 70, White Plains, mail and wire fraud conspiracy; Robert Franco, 50, Hartsdale, interstate transportation of stolen property; Mario Velez, 44, Peekskill, extortion conspiracy; Pasquale P. Cartalemi Jr., 50, Cortlandt Manor, extortion conspiracy and extortion; Pasquale L. Cartalemi, 27, Cortlandt Manor, extortion conspiracy and extortion; and Andrew McGuire, 29, Hawthorne, extortion conspiracy. A 20-year state police veteran, Velez reportedly retired in October during the investigation. He reportedly worked with two other defendants, Cartalemi Jr. and his son, at their AAA Carting and Rubbish Removal business in Peekskill. Velez and the Cartalemis reportedly forced another carter, the owner of Capital Waste Service in Hawthorne, to turn over his business to them. McGuire, the Hawthorne resident charged with conspiring in the extortion, reportedly is listed in state records as Capital Waste’s president. Federal officers described Sarcinella, who has a Scarsdale mailing address, as a soldier in the Genovese crime family who headed a family faction that at times controlled a waste hauling company incorporated by a cooperating witness. An 82-year-old Mahopac resident, Dominic “Pepe” Pietranico, also was charged with racketeering as an alleged Genovese soldier who led a family faction with Sarcinella. In Rockland County, Dominick Rao, 76, of Suffern, was charged with loan-sharking and Stephen Moscatello, 52, of Piermont, with stealing trash dumpsters from competitors and transporting them across state lines. Bharara said the Mafia families exerted control of the waste disposal industry “throughout a vast swath of counties in New York and New Jersey, and the tactics they used to exert and maintain their control come right out of the Mafia playbook – extortion, intimidation, and threats of violence. … Organized crime has many victims – in this case, small business owners who pay for waste removal, potential competitors and the communities infected by this corruption and its cost.” Westchester County Public Safety Commissioner George N. Longworth said the long-term partnership between the county police department and federal law enforcement “is an important means of combating organized crime and ensuring
that businesses in Westchester are free to operate without fear of extortion or undue influence.”
County to bond for Playland repairs
Westchester County is moving forward with plans to issue bonds to fund repairs at Rye Playland, which sustained more than $12 million in damage from Hurricane Sandy. The county Board of Legislators’ budget and appropriations committee unanimously approved two bonds last week and approval from the full board is expected Jan. 28. A $4,925,000 bond will fund repairs to the Playland Ice Casino, which sustained extensive damage. The facility’s roof requires major repairs before it can be reopened. Two doors were also blown off the building during the storm and a flood in the basement damaged the boilers. A $7,575,000 bond will go toward repairing Playland’s heavily damaged boardwalk. Portions of the structure were washed away due to the high winds and storm surge. The boardwalk has been closed to the public since the storm. The county expects to have about 70 percent of repair costs reimbursed by the Federal Emergency Management Agency (FEMA). Insurance will also pick up some of the tab. Legislator Catherine Borgia said it’s important that Playland opens in time for the summer season. “Playland is an iconic asset for Westchester,” Borgia said. “It creates a lot of economic opportunity; it creates a lot of jobs for young people.” Legislators also announced that the government operations committee will evaluate the four proposals for the revitalization of Playland in the committee meeting on Jan. 28. The Board of Legislators has claimed that County Executive Robert P. Astorino’s choice of the Sustainable Playland proposal from the original 12 proposals is illegal, because the board never voted to approve the county’s agreement with Sustainable Playland to revamp the park. Astorino claims the management agreement his administration signed with Sustainable Playland is not a lease, and as such, does not require the approval of the board. The board decided to unilaterally review each of the proposals, and has selected the Sustainable Playland, Central Amusements, Standard Amusements and LegoLand plans as finalists. — Sam Barron, Tarice L.S. Gray and John Golden These news briefs are a sampling of what the Westchester County Business Journal brings to you every day on the web. Sign up for our daily “News at Noon” e-newsletter at westfaironline.com.