Pill salesman told police of concerns

Xiao-Zhong Chen has pleaded not guilty to seven counts. Picture / Paul Estcourt

The man who arranged the sale of decongestant tablets to an Auckland heart surgeon had doubts but proceeded because of the doctor's good reputation.

Pharmaceutical company business manager Andrew Baker told the Auckland District Court he was suspicious when doctor Xiao-Zhong Chen contacted him in July 2003 wanting to buy Telfast tablets to export to China.

The suspicion was because of the large quantity and the fact they were the only product the company supplied that contained the vital methamphetamine-making ingredient, pseudoephedrine.

The Crown alleges Chen bought 22,000 packets of Telfast Decongestant during a nine-month period and onsold it knowing it could be made into up to $13 million worth of the illegal drug methamphetamine.

Chen accepts buying and onselling the tablets but says he really believed they were being exported to a pharmaceutical company in China, as he told his suppliers.

Mr Baker said he contacted police with his concerns about Chen straight away.

He also made his own inquiries, which included confirming Chen was a heart surgeon at Green Lane Hospital and speaking with other doctors.

He found Chen had a good reputation within the medical profession and that, combined with the fact he really was a heart surgeon, played a big role in his decision to continue with the sale.

Mr Baker said he emailed police saying he would proceed with the Telfast sale if he didn't hear back from them.

Police did not call back and Mr Baker proceeded, putting the sale through Anspec, a company that had a licence to export Telfast to China.

When asked by defence lawyer Paul Davison, QC, if he warned Anspec of his initial concern about selling to Chen, Mr Baker replied: "I told them I had been in contact with the police and had voiced my concerns. From the lack of any information coming back from the police on the contrary, I felt confident selling Mr Chen Telfast."

Mr Baker said he believed Anspec would be responsible for exporting the tablets to China. That was why he referred the sale to the company.

Anspec business manager Stephen Tree told the court he also had reservations about selling the large quantity of tablets to Chen but was reassured in part by Mr Baker's investigations.

He spoke to his Sydney-based boss who decided to proceed with the sale, on the basis Anspec was not responsible for the exportation.

Mr Tree told Chen he would have to arrange exportation and that he would need to pay with a bank cheque or cash because of his lack of history with the company.

Chen collected his first order of 300 boxes of tablets in October, after spending a day in surgery.

After that purchase and a request for more Telfast, Mr Tree asked Chen for proof of who he represented and what was happening to the tablets.

A few weeks later Chen provided this proof - written documentation which the Crown claimed in its opening address on Tuesday was false.

Over the next nine months Chen made another seven orders, altogether buying 22,000 packets of Telfast at $12 a box. Each time he paid cash, then sold them to a man called Yang for $25 a box.

Chen's last purchase was in August 2004, when he was caught in a police sting operation.