Concussion drug Prevacus founder pleads guilty in Mississippi welfare scandal case

A former research scientist and drug company CEO in Florida, whose work on a nasal spray to treat concussions was at one time touted across the nation, pleaded guilty Wednesday in federal court to wire fraud in connection with the Mississippi welfare scandal.

Jacob Vanlandingham appeared before U.S. District Judge Carlton Reeves at Thad Cochran Federal Courthouse in Jackson, where he admitted to using money he received through his company Prevacus for personal use, including gambling and paying off personal debt, according to court records.

"The purpose of the scheme and artifice to defraud was for VanLandingham to unlawfully enrich himself by making materially false and fraudulent representations that he would use certain funds, including funds obtained from MDHS through MCEC, to develop a pharmaceutical treatment for concussions," the government said.

The fraud began on or about Jan. 19, 2019, when VanLandingham, through Prevacus, entered into an agreement with the Mississippi Community Education Center, a charitable organization operated by Nancy New, who also pleaded guilty in the welfare fraud.

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Under the agreement, Prevacus would receive $1.7 million to go toward development of the nasal spray. But Prevacus received more than double that amount in the six months following, some of which came from Temporary Assistance for Needy Families (TANF) funds from the Mississippi Department of Human Services, court documents show.

The wire fraud took place in July 2019, when VanLandingham participated in the interstate transfer of about $400,000 from an MCEC bank account to a Prevacus account.

VanLandingham formerly worked with the Florida State University Medical School before starting Prevacus, which was headquartered in Tallahassee. Former NFL Hall of Famer Brett Favre , who lives in Hattiesburg, was an investor in Prevacus . Favre has not been charged with any crime in this case, but he remains a defendant in a related civil case filed in Hinds County.

VanLandingham faces up to 20 years in prison and up to $250,000 in fines.

He will remain free on a $10,000 unsecured bond until his sentencing, which will be scheduled at a later date.

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Also charged:

• New pleaded guilty to state and federal charges connected with her role in the fraud. She and her son agreed to testify against others in the case.
• John Davis, former director of MDHS, pleaded guilty to federal charges of conspiracy and fraud. He was indicted on state charges, which were dropped after he pleaded guilty in federal court.
• New's son, Zachary New , also pleaded guilty to state and federal charges in the case.
• Former MCEC accountant Anne McGrew pleaded guilty to state charges connected with the fraud.
• Former pro wrestler Brett DiBiase pleaded guilty to federal charges.
• DiBiase's brother Ted DiBiase Jr. , also a former wrestler, was indicted on federal charges but pleaded not guilty. He is scheduled for trial in January.
• Latimer Smith, who worked at MDHS, was indicted but later entered a pretrial diversion program, allowing him to avoid prosecution if he completes the terms of the program. His court records are not publicly available.

Contact Lici Beveridge at lbeveridge@gannett.com . Follow her on X  @licibev or Facebook at facebook.com/licibeveridge .

This article originally appeared on Hattiesburg American: Concussion drug Prevacus founder pleads guilty in Mississippi welfare scandal case