Insider Speaks Out On Meningitis Outbreak That Impacted Californians

(CBS News) -- A pharmacy called New England Compounding Center is under criminal investigation. Last fall, it shipped 17,000 vials of a contaminated steroid to 23 states, including California. Hundreds of people are still fighting horrific infections caused by the drug, and patients continue to die -- the most recent just 10 days ago.

We've never heard from anyone inside New England Compounding until now. A "60 Minutes" investigation has discovered how a pharmacy -- not supervised by the FDA -- came to ship toxic drugs across the country to unsuspecting patients.

"I've been in the hospital seven times, total of 75 days," says Julie Otto, one of the injured patients we met at St. Joseph Mercy Hospital outside Detroit. "I've missed Thanksgiving and Christmas and my son's birthday."

These patients were injected with the steroid to relieve chronic pain. Now, a fungus is inside them. The drug was produced by New England Compounding, known as NECC, outside Boston. Joe Connolly, a lab technician there, is the first to speak out about what happened.

This is the fungus inside patients who were injected with tainted steroids made by NECC. This sample was grown from the spinal fluid of a patient.

"The underlying factor is that the company got greedy and overextended and we got sloppy, and something happened," he says.

NECC was one of thousands of so-called compounding pharmacies. Congress exempted them from FDA oversight because, by law, they are allowed to make custom drugs just one patient at a time. But Connolly says, over a few years, NECC went national. He told us that quantities of drugs increased by a factor of 1,000.

"We became a manufacturer overnight," Connolly says. "So we were basically trying to have the best of both worlds. It was trying to manufacture without the oversight of a manufacturer. And it was just -- we all got over-taxed and everything."

A month before the first steroid death, Connolly says he warned his supervisor.

"Something's gonna happen, something's gonna get missed and we're gonna get shut down," Connolly recalls saying. "We were gonna hurt a patient. We were just thinking hurt a patient. We weren't compounding anymore, we were manufacturing."

When he went to his supervisor and expressed his concerns, Connolly says he shrugged.

"That's verbatim. He shrugged," Connolly says. "That was his response for a lot of our questions or comments or concerns, was a shrug."

Connolly says he interpreted the response as "just do it."

"He'd -- either he didn't care, or he was powerless to change it," Connolly says.

As Joe Connelly predicted, NECC was shut down by the authorities. The president of the company is Barry Cadden, and when subpoenaed by Congress, he pleaded the Fifth. Cadden declined to be interviewed for our story. On Thursday, his lawyer told us Cadden does not know how the contamination happened.

The state of Massachusetts examined NECC's lab in 2011 and found it satisfactory, but on Friday's broadcast of the "CBS Evening News," another company insider will tell us how NECC concealed its true operations from inspectors.

The full investigation can be seen this Sunday on "60 Minutes" at 7 p.m. ET.

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