KANSAS CITY, Mo. — An Eli Lilly and Co. drug salesman had become suspicious more than a year ago about cancer drugs handled by a Kansas City pharmacist but the company did not notify authorities, The Kansas City Star reported Sunday.

Pharmacist Robert R. Courtney was indicted Thursday on federal charges alleging he diluted expensive cancer drugs so he could pocket the difference in prices.

Lilly salesman Darryl Ashley became suspicious in early 2000, more than a year before his talk with Kansas City oncologist Dr. Verda Hunter led Hunter to alert federal officials, the newspaper reported, citing court records and company officials.

The newspaper said it wasn't clear when Ashley notified his superiors, and the company would not provide a date.

A spokeswoman for the Indianapolis-based drug maker acknowledged that the company did not tell authorities. Judy Moore said the company's own investigation determined that problems with the cancer drug Gemzar did not originate at Lilly's plant.

Moore said Lilly "acted honorably" and is cooperating with the FBI's investigation.

"Lilly takes patient safety very, very seriously," she said.

Courtney, 48, is charged with eight counts of tampering with consumer products, six counts of adulteration of a drug and six counts of misbranding a drug.

Authorities say he saved hundreds of dollars per dose and was motivated by profit and $600,000 in looming tax bills.

This past May, Ashley told Hunter that he had noticed a discrepancy between the amount of Gemzar that Courtney ordered and the amount he was billing Hunter.

Hunter then ordered tests on medications supplied by Courtney, found the drugs had been diluted and notified federal officials. The FBI's investigation started July 27.

Court records say Hunter tried to get Lilly to test her samples, but the company didn't respond.

Lilly spokesman Jeff Newton said the company had no record of a letter Hunter sent.

Experts said Lilly had no legal obligation to pursue its concerns beyond its internal investigation, but ethicists said the company should have done more.

"If harm is continuing and you can stop it, you're obliged to stop it," said Joseph H. Reitz, co-director of the International Center for Ethics in Business at the University of Kansas. "Blowing a whistle is uncomfortable. ... If you can prevent serious harm from continuing, you ought to do it."

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Federal authorities say at least one patient who received drugs from Courtney has died.

The FBI says samples of drugs prepared by Courtney's Research Medical Tower Pharmacy contained generally less than half of the medication prescribed.

Prosecutors have said they have evidence of at least 150 instances of dilution, which could have affected hundreds of patients.

But Courtney's lawyer, Jean Paul Bradshaw II, has said Courtney's dilutions affected only about 30 to 35 patients. Bradshaw has said Courtney will plead innocent to the federal charges. Courtney is being held without bond.

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