Medical regulators in New Jersey heard from health inspectors on Friday about unsanitary conditions in a doctor's office they suspect is the source of a hepatitis B outbreak, in which nearly 3,000 patients are being warned to get tested.

Five cancer patients of Dr. Parvez Dara have tested positive for hepatitis B, a disease that is transmitted through exposure to infected blood.

According to state health inspectors, some of the health code violations found in Dara's office include blood on the floor of a room where chemotherapy was administered, blood in a bin where blood vials were stored, open medication vials, and unsterile saline and gauze.

"This was not a one-time episode," Deputy Attorney General Siobhen Krier said of the conditions during her opening remarks to the state Board of Medical Examiners, which is considering whether to suspend Dara's medical license.

Krier told the board that Dara failed to train his staff and showed "a flagrant disregard of infection control norms, a lack of competence and a demonstrated lack medical judgment."

Two cases of hepatitis B were confirmed in late February as connected with the Dara, an oncologist with offices in Toms River and Manchester, near the Jersey Shore. Health officials recently learned of three more cases, all in Toms River, in which the patients were also under Dara's care and inspected Dara's office in response.

Dara told The Associated Press that all his procedures were performed using sterile supplies and equipment.

He also expressed sympathy for his patients: "This is hurting them so much more than it's hurting me."

Dara attorney Robert Conroy criticized the state investigation as sloppy, saying there is no direct evidence that the hepatitis cases were linked to Dara's office.

"This is nothing more than a three-card Monty game by the state," he told the board.

He argued that there are other factors that aren't being considered, such as the fact that all five patients were also seen at Community Medical Center in Toms River and three shared the same surgeon. One patient, he said, had been diagnosed with hepatitis B in 2005.

Dr. Barbara Montana, the lead investigator in the case for the state Health Department, said the hospital and surgeon were ruled out as a possible sources of the infection. She said the only treatment all five patients received during the disease's six-month incubation period was from Dr. Dara's office.

"Before you went into Dr. Dara's office, you already concluded that's where the outbreak occurred, correct?" Conroy asked Montana about the inspections.

"Absolutely not," she answered.

"We felt we had a reason to go in and investigate, and what we saw was consistent with blood-borne disease transmission," she added.

Dr. Montana said the state decided to warn Dara's patients following the inspections. She said all of Dara's patients dating back to 2002 were warned because Dara has infection control violations that go back that far, including violations of standards of the federal Occupational Safety and Health Administration, she said.

A March 28 letter was sent to patients warning them of the risk and suggesting they be tested for the liver diseases hepatitis B and hepatitis C and for HIV, the virus that causes AIDS.

Conroy is asking that Dara be allowed to at least perform exams and consultations until the state finishes its investigation. He said Dara has retained consultants to retrain his staff and to help ensure that he is in compliance with all health code regulations.

Dr. Montana said she didn't believe there was concern about disease transmission so long as there were no treatments involving needles or injectable medication allowed at Dara's office.