Chiron fined for exports to Cuba

The U.S. Treasury Department reported that it has fined biotechnology firm Chiron Corp. $168,500 for illegally exporting goods to Cuba.

According to Chiron, from 1999 to 2002, the Emeryville-based company shipped five vaccines for infants and children to Cuba from its plants in Germany and Italy.

The company held a license to export one vaccine through UNICEF, the United Nations Children's Fund, but didn't have clearance to ship the other four. A routine audit in 2002 uncovered the oversight, said John Gallagher, Chiron's spokesman. Chiron voluntarily disclosed the error to the Treasury Department and negotiated a settlement, he said.

"We recognize that it was a violation, and it was our responsibility to bring it to the attention of the government," Gallagher said.

The company is now legally shipping all five vaccines, including polio, haemophilus influenza, flu, rabies and a vaccine for measles, mumps and rubella.

The fine is the second-largest civil penalty issued this year by the Treasury Department's Office of Foreign Assets Control, or OFAC. The department in April reported that it had fined Alpha Pharmaceutical Inc. $198,711 for illegally exporting goods from 1998 to 2003.

Federal regulations have tightly controlled the exportation of goods to Cuba since 1963. Under the regulations, sales of U.S. products, technology or services are not allowed. Shipments of medicine and medical equipment are legal, but only when companies or individuals have received appropriate clearance from OFAC.

Two years ago, Chiron might have gotten away with a much lighter penalty, said Dario Moreno, a professor of political science at Florida International University. But in recent years, the Treasury Department has clamped down, he said.

"It seems to me that a few years ago, something like this wouldn't have drawn attention," Moreno said. "They would have gotten a slap on the wrist and told to fill out the proper paperwork."