The biolab in Reedley is owned by Prestige Biotech Inc., but a closer look into a complex network of companies and employees, including Prestige, all ultimately lead back to Jia Bei "Jesse" Zhu, a Chinese national with a Canadian passport.
Just hours after this article was published on Oct. 19, Mr. Zhu was arrested in California and charged with manufacturing and distributing misbranded medical devices and for making false statements to the FDA. A sealed indictment had been filed on Oct. 18.
Mr. Zhu faces a maximum of three years in prison for the misbranding charge and five years for the false statements charge according to the U.S. Attorney's office for the Eastern District of California.
According to court documents, between December 2020 and March 2023, Mr. Zhu and others allegedly manufactured, imported, sold, and distributed hundreds of thousands of COVID-19 and other test kits in the United States and China. They did so through the companies Universal Meditech Inc. and Prestige Biotech Inc. without proper authorization.
“As part of his scheme, the defendant changed his name, the names of his companies, and their locations,” said U.S. Attorney Philip A. Talbert.
The criminal complaint alleges that during the investigation, Mr. Zhu made several false statements to FDA officials, including using a false name and falsely representing his knowledge about the company's activities.
City of Reedley staff were told by Prestige Biotech president Yao Xiuqin that his company had taken over the warehouse—including the biological materials, samples, and lab mice—from Universal Meditech Inc. after the latter claimed bankruptcy, according to a court document filed on June 15.
Prestige Biotech is the main creditor of Universal Meditech.
Public records show that Prestige Biotech was first registered in Nevada to Wang Zhaolin (also known as Lynn Warner) on April 3, 2019, before current company president Mr. Yao, who’s based in China, took over on May 28, 2021.
Universal Meditech was established in Tulare, California, on Nov. 25, 2015, naming Mr. Zhu as CEO. The company obtained a California business license on March 20, 2019.
"Universal Meditech was started by a group of Canadian and Chinese investors and specializes in research, development and assembly of diagnostic test kits used in dairy cattle reproduction," said Paul Saldana, who was president and CEO of the Tulare County Economic and Development Center in 2015, according to Visalia Times Delta.
Shortly after the pandemic started in March 2020, Universal Meditech switched from a cattle reproduction-related business to producing pregnancy test kits and COVID-19 test kits.
In August 2020, a fire broke out at the company's Fresno location and a subsequent environmental health inspector’s visit found that Universal Meditech didn't have a hazardous materials plan for storing ethanol in the warehouse.
Current documents filed with the California secretary of state don't show Mr. Zhu as CEO of Universal Meditech anymore, instead naming Wang Xiaoxiao as CEO, chief financial officer, and secretary, with an address in south central Fresno.
Another name connected to Universal Meditech and many other similar companies is Wang Zhaoyan, who’s also known as Wang Yan. Ms. Wang is listed as president of Universal Meditech in an online business directory, and The Epoch Times obtained a plumbing permit issued to Ms. Wang of Universal Meditech from the City of Tulare in 2016. An FDA filings report for Universal Meditech also lists Ms. Wang as the "official correspondent."
Ms. Wang is also a principal in another California-based company, Superior Meditech Investments LLC, and an officer or managing member for three other related companies based in Nevada—PBI Diagnostic Laboratory LLC, Medi-Source LLC, and David Destiny Discovery LLC.
She’s also listed as executive director and general manager for a company in Qingdao, China, called Ai De Biopharmaceutical Industry (Qingdao) Co. Ltd.
The general manager for Ai De Biopharmaceutical is also the president for Prestige Biotech (the secret biolab in Reedley that bailed out Universal Meditech), according to California and Nevada business filings and a Chinese company directory.
All of the executives and all the companies eventually lead back to Mr. Zhu, the Chinese man with a Canadian passport.
Mr. Zhu and several of his companies have been mired in legal battles stretching from Canada to Hong Kong to the United States since 2008.
In September 2010, Mr. Zhu filed a proof of claim as "the owner" of Ai De Biopharmaceutical in a bankruptcy proceeding for yet another of his companies, JingJing Genetics Inc.
"The sole shareholder of Ai De is a British Virgin Island company (Unique Way Technology Limited) which, in turn, is owned by IND, which is owned by Zhu," according to a 2016 ruling by the Supreme Court of British Columbia in Canada.
Ai De Biopharmaceutical's street address in Qingdao is the same as other Chinese medical firms such as Qingdao Guangdi Packaging Material and Ai De Diagnostic. According to import records, most of these firms have shipped medical supplies to Universal Meditech and Prestige Biotech.
Mr. Zhu resigned from his positions of chairman of the board and general manager at Ai De Biopharmaceutical in November 2018, according to Chinese documents.
The Epoch Times called several numbers for Ai De Biopharmaceutical's headquarters in China, but the numbers have been disconnected or are no longer in service.
Mr. Zhu was born in China in 1961 and obtained a Bachelor of Science degree from the Beijing University Medical Department in 1984 and a master's degree from the Peking Union Medical College Hospital in 1988. He went on to conduct bio research at the University of British Columbia in Canada, according to Sina Finance.
In 1991, Mr. Zhu established IND Dairytech Ltd in Vancouver and became chairman of the board.
In the late 1990s, Mr. Zhu flew a dozen Holstein cattle (a breed known for high milk production) from Quebec to Beijing to enhance milk production in China, where it was in great need.
A decade later, Mr. Zhu's focus switched to breeding technologies. Rather than transporting cattle to China, IND Dairytech began sending Holstein semen and embryos in an effort to develop cattle herds.
Primarily serving customers in Canada, IND Dairytech was listed on the Toronto Stock Exchange in 2008, delisted in 2011, and acquired shortly afterward by IND Lifetech, another company controlled by Mr. Zhu.
The Chinese characters of "Ai De" are also in the upper left corner of IND Lifetech's logo.
Not long after IND Lifetech acquired IND Dairytech, it changed its name to JingJing Genetics, still based in Canada and controlled by Mr. Zhu.
In 2008, JingJing Genetics was sued by XY LLC, a Colorado-based company that claimed damages for "conspiracy, deceit, breach of confidence, breach of contract, and inducing breach of contract."
XY had developed the technology to "choose the sex of the offspring using sexed semen or sexed embryos" for "non-human mammals, including cattle, horses, pigs, and endangered species," according to an online statement.
The company was "the master licensee in control of all sperm sorting in non-human mammals worldwide."
JingJing Genetics was allegedly stealing XY’s technology to manufacture and sell bovine sexed semen, but without the strict controls required from a licensee.
The case was decided in 2012, with the judge ruling against JingJing Genetics for violating intellectual property agreements.
JingJing’s three principals at the time—Mr. Zhu, Selen Cui Feng Zhou, and Jin Tang—were found liable for "civil fraud and conspiracy to cause economic injury" and were ordered to pay CA$8.5 million (US$6.2 million) to XY, according to a statement at the time.
Canadian Judge Stephen Kelleher also issued JingJing and its principals a permanent injunction from using the so-called cytometer technology that analyzes and sorts cells for choosing the sex of the offspring.
However, days after the judge's ruling, XY received information that Mr. Zhu had set up a new company, Fraser Biomedical Inc., "for the purpose of secretly producing sexed semen using XY’s technology," according to a report by the Canadian Broadcast Network.
Judge Kelleher subsequently found Mr. Zhu in contempt for nonpayment of the CA$8.5 million and in 2015 sentenced him to jail for six months. But Mr. Zhu had fled Canada in 2014, and The Epoch Times was unable to find evidence that he has ever returned.
While ruling in another British Columbia Supreme Court case involving Mr. Zhu and his many companies, Justice Shelley Fitzpatrick said, "Zhu’s counsel indicated to me that Zhu is afraid of setting foot in this jurisdiction for fear that he will be arrested," according to court documents.
In that case, Judge Fitzpatrick ruled in 2016 that Mr. Zhu and his employees were to pay an additional CA$330 million (US$242 million) to XY for continued conspiracy to obtain intellectual property and confidential information.
"It is difficult to express the degree and scope of Zhu's wrongdoing in relation to his concerted plan and actions to steal XY’s Confidential Information for his own financial ends," Judge Fitzpatrick wrote in her ruling.
Court documents show transcripts from messenger app WeChat between Mr. Zhu and Mr. Xu from 2014. The messages reveal that Mr. Zhu’s goal was "total bankruptcy" for XY.
"If the new system is swiftly marketed, causing the overall sexed semen production cost to fall by twice as much, how do you think they are going to live from now on? ... So I propose using about 3 years in making [XY] collapse or be acquired cheaply," Mr. Zhu wrote in a text to Mr. Xu in May 2014.
"At the most opportune time, to acquire [XY] using the best price should be our basic strategy. Before that, we shall engage in attrition with them, drag them on as much as possible, drag them down, to let them feel all the time the sword of Damocles is on their heads. For this, we have already designed a comprehensive operational scheme."
An email exchange from April 2011 was also highlighted in the 2016 ruling.
In an email to Mr. Tang and Mr. Zhu, Mr. Xu wrote, “Well it seems American imperialism is very cunning, suggest to make an imitation one,” clearly referring to XY.
Mr. Zhu replied, "The law is strong, but the outlaws are ten times stronger."
In her ruling, Judge Fitzpatrick said: "The evidence makes clear that all of these defendants each played a part in the overall plan to steal XY’s confidential information for their own use by various means.
"This was all done for the benefit of the IND Group.
"As an overarching comment, it is difficult to express the degree and scope of Zhu’s wrongdoing in relation to his concerted plan and actions to steal XY’s confidential information."