The opioid's potency has transformed the global trafficking — and policing — of narcotics.
Among the 5,000 apartments, on a high-rise’s 20th floor, lives Yan Xiaobing, a chemicals distributor with short, spiky hair. His wife, Hu Qi, operates an English tutoring business. Their social-media feed shows the couple and their two young children under blue skies at the beach and posing at landmarks in Europe and Japan. One photo shows Yan reading to pupils in a classroom.
In half-frame glasses, blue plastic house slippers and button-down shirt, Yan could have passed as an ordinary office worker when Bloomberg News reporters found him late last year. Filling the apartment doorway with his 6-foot frame, he expressed soft-spoken bafflement at the portrait the U.S. Justice Department paints of him: not a modest businessman, but a new type of international drug dealer. “This is horrifying,” he said. “Their investigation must have gone wrong.”
Federal prosecutors in Mississippi charged Yan, 41, in September with leading an empire built on the manufacture and sale of drugs related to fentanyl, one of the world’s deadliest and most profitable narcotics. So strong that it’s been studied as a chemical weapon, the drug has saturated American streets with breathtaking speed: It kills more people than any other opioid, including prescription pills and heroin, because it’s so easy to overdose. Authorities say they have linked Yan and his 9W Technology Co. to more than 100 distributors across the U.S. and at least 20 other countries. Investigators expect scores of arrests as they dismantle his alleged network.
A month after the indictment, Deputy Attorney General Rod Rosenstein held a Washington news conference to shine a spotlight on Yan and another man, Zhang Jian, 39, who’s accused of a similar scheme. Their indictments, Rosenstein told reporters, marked “a major milestone in our battle to stop deadly fentanyl from reaching the United States.”
Yan is the first Chinese national the U.S. has ever added to its “consolidated priority organization target” list of individuals thought to command the world’s most prolific drug-trafficking and money-laundering networks. Investigators say his strategy was to offer fentanyl-like compounds called analogues — which differ slightly on a molecular level but produce similar effects — in order to exploit discrepancies between the laws in the U.S. and China. Rosenstein expressed optimism that his Chinese counterparts would hold Yan accountable.
But if Yan doesn’t resemble a stereotypical drug lord, neither is fentanyl your average drug. It has upended how traffickers conduct business and how such activity gets policed. Bloomberg News examined hundreds of pages of court documents and government reports and interviewed drug dealers and law officers, retracing a byzantine path that took investigators from a Mississippi parking lot all the way to Wuhan.
Fentanyl’s astronomical profit margins have driven its rapid spread. When Gibbons and Metcalf went undercover, they bought a kilogram from China for $3,800, which, when turned into tablet form, could fetch on the street up to $30 million. Compare that with a kilo of heroin, which wholesales for about $50,000 in Gulfport and generates a profit of just $200,000.
“Fentanyl is a smuggler’s dream,” said Scott Stewart, a former U.S. State Department special agent who’s a vice president at Stratfor, a global intelligence firm. “It’s compact. It’s valuable. It’s fantastic for the smugglers and it’s terrible for law enforcement.”
There’s no need to grow vast fields of opium poppies, which must be defended against weather, competitors and government eyes. Raw materials and equipment are cheap. Synthesis takes about a week and requires neither heat nor skills more sophisticated than following a recipe. And in recent years, rogue chemists have unearthed instructions for analogues that researchers discovered decades ago but never put into legitimate use. Sellers offer these variations before governments can outlaw them. Potency and purity vary: One dose may produce a euphoric high, while another kills immediately.
Most fentanyl on America’s streets isn’t made for pharmaceutical use and then diverted. According to the DEA, it’s illicitly manufactured in overseas laboratories. Mexican cartels play an increasingly prominent role, using networks established for heroin and methamphetamine. But U.S. officials say most originates in China, one of the world’s top manufacturers and exporters of raw pharmaceutical ingredients.