GenPhar building foreclosure allowed to move forward

The GenPhar building on South Morgan Point Road in Mount Pleasant has sat vacant for years. (Brad Nettles/

The foreclosure of a multimillion-dollar vacant building in Mount Pleasant will be able to proceed, according to a federal order.

The building that was to house the biotechnology company GenPhar has remained in legal limbo since the its founder was indicted on federal fraud charges more than two years ago.

John Dong has been awaiting trial on charges that accuse him of fleecing the government out of $3.6 million in grant money that was meant to fund research on vaccines against the deadly viruses Ebola and Marburg.

When Dong was indicted, his assets were frozen by the federal government through a restraining order. Recently, GenPhar attempted to use that order “as a shield to forestall the foreclosure proceedings now pending,” according to a filing by the prosecution.

Prosecutors asked District Judge Weston Houck to clarify or amend that order last month to show that the foreclosure should be able to move forward.

Houck issued that clarification last week, stating that the restraining order was not to affect or restrict the foreclosure of the property, a 50,000-square-foot facility behind The Market at Oakland shopping center on U.S. Highway 17.

The foreclosure case remains pending before another federal judge.

The building has been vacant for years and has been decreasing in value, according to a filing by federal prosecutors.

The 2.6 acres of land was valued last year at $938,000, according to Charleston County officials. It is unclear what the current value of the building is, but at one time it had an estimated value of $33 million.

Dong commissioned the three-story building to house the company’s 300 employees in 2010, but they never made the move into the building because federal authorities launched an investigation into Dong and GenPhar’s handling of federal grant money.

In March, Dong was convicted of making illegal campaign contributions to Sen. Lindsey Graham, who had been unaware of the violation. Prosecutors said Dong funneled money to the senator’s campaign in hope of cashing in on grant money awarded by Congress.

The building has gone through myriad problems since it was built. In early 2010, GenPhar’s expansion project hit the skids when the town slapped a stop-work order on the building over design and material issues.

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At the time, Dong said construction delays were costing GenPhar hundreds of millions of dollars in potential contracts. The project ground to a halt and GenPhar laid off 15 employees in June 2010. The rest of the company dissolved over time, and Dong is the only remaining employee, according to testimony, operating out of a Long Point Road office.

In May 2012 thieves broke into the building and stripped it of nearly $500,000 worth of copper wiring, according to Dong.

The property has been the target of vandalism as well, according to the federal filing.

Dong has not been sentenced for the conviction regarding the illegal campaign contributions he made. The trial for the charges involving the allegations of grant money theft was last scheduled for November.

Reach Natalie Caula at 937-5594 or