U.S. authorities arrested John Thomas Howard, treasurer and a director of Canadian prescription company CANARX, on Sunday on smuggling and conspiracy charges, according to court records filed Tuesday, CNBC reported¹.

An arrest warrant also listed charges of introducing misbranded drugs into interstate commerce and illegal drug importation, CNBC said, citing the records¹. No plea has been filed¹.

Bob Howard, his brother and CANARX's president and a director, is wanted in the same federal investigation and has not been taken into custody, according to an affidavit by Dustin Dobbs, a special agent with the Food and Drug Administration's Office of Criminal Investigations, as described by CNBC¹.

CANARX, founded in 2002 and based in Windsor, Ontario, describes itself on its website as an international prescription provider for U.S. patients, sourcing medicines from Canada, the United Kingdom, Australia and New Zealand, CNBC reported¹.

The FDA affidavit said there is probable cause to believe CANARX illegally imported or caused the illegal importation of prescription drugs into the United States, CNBC reported¹. The affidavit does not specify which medications, and the criminal complaint covers Feb. 22, 2017, through April 15, 2026¹.

Joseph Morris, the company's general counsel, told CNBC: "The Howards deny all the charges against them, will defend vigorously, and expect to be vindicated in court"¹.

CNBC said CANARX has faced FDA scrutiny for years, including a 2019 warning letter that said the company was substituting unapproved drugs for FDA-approved prescriptions, and a 2023 seizure of medication the agency said was potentially misbranded and counterfeit¹. Morris previously told CNBC the company operated legally and sourced from highly regulated countries¹.

CNBC said alternative funding programs often obtain medicines overseas and ship them to U.S. patients, a practice federal authorities have said is illegal and poses safety risks¹. An FDA spokesperson told CNBC last year that in most circumstances a person cannot import prescription drugs from other countries as substitutes for FDA-approved drugs¹.

Separately, Gilead Sciences has a pending civil lawsuit accusing CANARX and other companies of illegally importing Biktarvy, its HIV medication, CNBC reported¹. A Gilead spokesperson told CNBC the company has taken legal action to protect the U.S. medicines supply chain and welcomed government efforts to hold people accountable whose conduct may put patients at risk¹. CNBC said CANARX has not responded to that lawsuit¹.