Federal prosecutors charged John Thomas Howard, treasurer and director of Canadian prescription drug importer CanaRx, with smuggling and conspiracy following his arrest on November 8. The criminal complaint covers conduct from February 22, 2017 through April 15, 2026, according to CNBC. No plea is on file.

The arrest warrant adds two further counts: placing misbranded medications into interstate commerce and importing drugs unlawfully. The affidavit does not identify which medications the government believes CanaRx imported illegally.

Howard's brother, Bob Howard, serves as CanaRx's president and as a director. He is sought as part of the federal probe and remains at large, CNBC reported.

What do the allegations say?

FDA special agent Dustin Dobbs wrote in an affidavit that "there is probable cause to believe that (CanaRx) illegally imported or caused the illegal importation of prescription drugs into the United States." The sworn statement anchors the government's case to a nine-year window ending in April 2026.

CanaRx is based in Windsor, Ontario. On its website, the company states that it sources medications from Canada, the United Kingdom, Australia and New Zealand.

CanaRx general counsel Joseph Morris responded in a statement. "The Howards deny all the charges against them, will defend vigorously, and expect to be vindicated in court," Morris told CNBC.

How long has the FDA pursued CanaRx?

The FDA has scrutinized the company for several years. In 2019, the agency sent CanaRx a warning letter stating that the company was replacing medicines U.S. clinicians had prescribed and the FDA had approved with unapproved versions. Morris countered that CanaRx was not deceiving patients, though the company consented to end imports of medications requiring administration by a physician.

In 2023, the FDA confiscated a CanaRx shipment of medication that the agency said might have been mislabeled and fake. The agency based that assessment on an email a patient received, which CNBC obtained.

What is an alternative funding program?

CanaRx belongs to a group of businesses known as alternative funding programs, which supply high-cost specialty drugs to employers at reduced prices. These programs frequently purchase drugs abroad and ship them directly to patients, a practice federal authorities have described as unlawful and a safety hazard. The FDA permits Americans to bring in drugs for personal use under certain circumstances, provided no domestic supply exists.

Is there related litigation?

Gilead Sciences has a pending civil lawsuit naming CanaRx among several firms it alleges unlawfully brought Biktarvy, its HIV drug, into the United States. CanaRx has not responded to that suit.

A Gilead spokesperson told CNBC on Wednesday that the company welcomes "the government's efforts to hold accountable those whose conduct may put patients at risk." Gilead trades on Nasdaq under the ticker GILD.

What happens next?

The federal case now proceeds against John Thomas Howard, while authorities pursue Bob Howard. The complaint's 2026 end date indicates the government views the alleged scheme as ongoing. CanaRx's defense, per Morris, rests on full denial of all charges and an expectation of vindication in court.