Print edition: 
TOPEKA — Tom Wiggans, a Democratic candidate for Kansas governor, said Friday that he will remain in the race after allegations surfaced that his former pharmaceutical company misled investors about a skin product.
Wiggans was CEO at California-based Connetics Corp. when a group of investors accused it of concealing test results suggesting its new acne treatment caused tumors in mice. The investors, led by the Oklahoma teachers' pension fund, filed a class-action suit which Connetics later settled for $12.75 million.
Wiggans, a native Kansan and political newcomer who returned to the state this year, wasn't available for comment Friday, according to his spokeswoman, Amy Jordan Wooden.
But Wooden said Wiggans didn't do anything improper at Connetics and helped steer the company through a difficult time.
"Anyone who has owned or run a business knows that, unfortunately, legal matters are one of the challenges any business will face from time-to-time," Wooden said in a written statement. "Tom was able to lead Connetics through this situation, with no findings of wrongdoing, and come out stronger on the other side."
However, the campaign of his Republican opponent, U.S. Sen. Sam Brownback, cited a Securities and Exchange Commission investigation and the class-action settlement as proof that Wiggans isn't fit to serve.
"Tom Wiggans is a fraud," said Brownback campaign manager David Kensinger. "His candidacy is a fraud and the Democratic Party is attempting to perpetrate a fraud on the people of Kansas."
Wiggans, 57, joined Connetics
in 1994 as the startup's ninth employee. It grew into a publicly traded, 400-employee company focusing on dermatology. According to court documents, Connetics hoped the acne gel Velac would become its best-selling product.
During lab trials in 2004, the company discovered that 56 percent of the lab mice exposed to Velac developed skin tumors, according to the suit and SEC records.
After the Food and Drug Administration rejected Velac in 2005, Wiggans said his company would keep trying.
"We remain committed to bringing Velac to market," Wiggans said in a news release announcing the FDA decision.
After the announcement, Connetics' stock price fell 27 percent. Unhappy investors later filed a class-action suit alleging that Connetics executives misled investors about Velac's chances with the FDA. The suit also alleged that Connetics inflated sales numbers to boost its stock price.
The SEC investigated and filed a complaint against a company vice president, alleging that he sold stock in Connetics the day he learned about the FDA's concerns. The executive also alerted a friend to sell his stock, according to SEC documents. The executive agreed to pay a fine of more than $700,000 to settle the SEC complaint.
Connetics fired the executive, according to Wooden. She noted that the SEC scrutinized Wiggans, too, and didn't file a complaint.
In response to the Brownback campaign's statement, Wooden said: "Sam Brownback's campaign calling someone else a 'fraud' is like Britney Spears criticizing someone's parenting skills."
Leading Democrats are standing behind Wiggans. State Party Chairman Larry Gates said Wiggans told him about the lawsuit before announcing his candidacy. Gates said he considers Wiggans' business background a strength.
"We're pleased to have a person (as a candidate) that created jobs," Gates said. "I would contrast that with Brownback, who has created one job in his life — his own."
But the allegations could hurt Wiggans' chances, according to a Washburn University political scientist, particularly because Wiggans isn't well-known around the state.
"The challenge for Tom Wiggans is to not let Sam Brownback define Tom Wiggans to the voters," said professor Bob Beatty. "He's lost stage one. His hurdles are now a little bit higher."
Wiggans faces Democrat Herbert West of Paola in the August primary.
