A Martinez man on supervised release for a 2015 conviction for manufacturing and selling pills designed to look like Xanax was charged with producing counterfeit drugs containing the same active ingredient as Xanax out of a Concord warehouse, the U.S. Department of Justice said in a news release.
Jeremy Donagal, 41, also known as the Xanax King, or XK, was charged Friday with selling the counterfeit pills on the dark web — a segment of the internet that requires specialized software to access and which can grant users greater anonymity. He was arrested Wednesday inside his Concord warehouse, authorities said.
Donagal had signed a lease in December 2018 for the warehouse on Solano Avenue, where he allegedly had ” multiple pill presses, plastic trays with punches and dies in them, thousands of pressed tablets, packaging and shipping materials, and other equipment consistent with a mail-order business,” according to the news release.
Donagal was allegedly manufacturing and selling generic alprazolam pills, which contain the same active ingredient as Xanax, an anti-anxiety medication. He took care to make his pills look identical to the real thing, prosecutors said.
“At its height, (Donagal’s) operation manufactured and distributed well over 1,000,000 alprazolam tablets in a single week, and Defendant sold these tablets for between $.50 and $1.00 per pill, depending on the quantity of the order,” Assistant U.S. Attorney Kevin Barry wrote in a 2015 sentencing memo.
According to the criminal complaint, Donagal was manufacturing the alprazolam pills and using the same markings as Sandoz Inc., one of the largest drug makers in the country, which recently agreed to plead guilty in an anti-trust and price-fixing scheme.
Donagal was sentenced to 70 months in federal prison for his 2015 conviction, but was released in 2018. The sentence included three years of supervised release.
Before he was sentenced, Donagal wrote a letter to the court in which he apologized for his conduct. He said his criminal life started after a series of personal tragedies, including the death of his mother and being diagnosed with cancer, which led to a pain medication addiction. He had “great remorse,” he wrote.
“Through this experience, and from this moment forward, I have made a commitment to myself; a commitment to not only be a smart man, but through lessons and life experience to develop, transform, and transcend to a wise man,” Donagal wrote.
On Friday, the government also filed a motion to revoke his release, saying he began setting up a counterfeit drug manufacturing operation almost as soon as he was released from prison.
“He set up a laboratory and pill press operation to manufacture the counterfeit pills, and he established a dark web vendor site to sell the pills nationwide,” the motion reads. “He also established vendor pages on dark web criminal marketplaces like Samsara and Empire.”
In 2014, Donagal and five others were arrested in Contra Costa County and accused of manufacturing counterfeit Xanax, a trademark of the pharmaceutical company Pfizer Inc., as well as other charges including money laundering for wire transfers he allegedly sent to China — charges that could have lead to up to 50 years in federal prison.
Donagal made his first federal court appearance on Friday. He faces up to four years in prison and one year of supervised release for the charge of possessing equipment to produce counterfeit drugs, and three years in prison and one year of supervised release for the charge of counterfeit drug manufacturing and sale.
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