Tag Archives: investigations

The DEA Attacks Legitimate Pharmaceutical Distributors, Starting with CVS Pharmacy and Cardinal Health

Earlier in February 2012, the DEA accused both CVS Pharmacy, one of the nation’s largest drug store chains, and Cardinal Health, one of the nation’s largest legitimate distributors of pharmaceuticals, of endangering the public by selling excessive amounts of oxycodone to four Florida pharmacies. For Cardinal Health, the charges came in an immediate suspension order served Feb. 3, 2012, when the DEA suspended Cardinal’s license to distribute controlled substances from its Lakeland, Florida location, which serves four states, according to USA Today. Lakeland is located between Orlando and Tampa.

Cardinal immediately challenged the suspension in federal court denying the charges. The DEA’s suspension was temporarily lifted and a hearing was scheduled in the federal district court in Washington, D.C. In preparation for the hearing, the DEA and Cardinal filed hundreds of pages of documents that provide a look into how prescription painkillers have infiltrated the black market. We are attempting to obtain copies of some of these so that we can share them with other interested attorneys and individuals.

As reported in various media sources, the investigation into Cardinal’s operation began after a Cardinal investigator became aware of a rumor that a local pharmacy was selling oxycodone by the pill for cash. This Florida pharmacy was reported to be one of Cardinal’s biggest customers.

Over the next two years, Cardinal employees allegedly visited the same pharmacy at least four more times. Each time, they noted the following suspicious signs: Customers paid cash, oxycodone was the top seller, and young people came into the pharmacy in groups to have their prescriptions filled. The pharmacy allegedly dispensed 462,776 oxycodone pills over a two month period — which is what the DEA states is approximately seven times what the average pharmacy dispenses in a year. Additionally the pharmacy allegedly asked Cardinal for more. Cardinal filled the order for more oxycodone but terminated the pharmacy as a customer.

By the time Cardinal cut the pharmacy off in October 2011, police had arrested at least three doctors who were associated with or had their patients’ prescriptions filled at the pharmacy.  Law enforcement officials charged them with trafficking in oxycodone, racketeering and over-prescribing narcotics.

Then, in early February 2012, the DEA reportedly suspended the DEA registrations (sometimes called “DEA numbers” or “DEA licenses”) of four of Cardinal’s largest Florida customers. These suspensions demonstrate the DEA’s strategy to combat the country’s prescription drug abuse problem at the highest levels, regardless of the size or reputation of the company. After years of attacking doctors who dispense drugs from pain clinics, DEA agents are now targeting the legitimate pharmaceutical distributers — the top of the legitimate drug supply chain.

The number of overdose deaths involving prescription pain medications allegedly now exceeds deaths from heroin and cocaine combined, which motivates state and federal agents to be more aggressive in fighting against misuse of drugs.

Under the federal Controlled Substances Act, the DEA regulates every link in the supply chain for controlled substances such as oxycodone and hydrocodone, including manufacturers, distributors, doctors and pharmacies. According to the DEA, approximately 1.4 million entities have DEA registrations to handle controlled pharmaceuticals. The law requires pharmaceutical distributors, like Cardinal Health, to have systems to detect suspicious orders, which must then be reported to the DEA.  Additionally, federal regulations require that any thefts, losses or shortages of controlled medications be reported to the DEA.

In court documents filed in response to Cardinal’s challenge, the DEA said Cardinal ignored “red flags” raised to detect suspicious orders. However, Cardinal argues that volume alone is not enough to determine whether a pharmacy is diverting the drugs, because it does not account for a pharmacy’s location, the age and health of the population, and the proximity to hospitals, nursing homes and cancer centers.

The DEA routinely cites the volumes of drugs a pharmacy fills or the numbers of tablets of a certain type of medication for which a doctor writes prescriptions.  This is also a factor the DEA uses in cases we have seen where it seeks to suspend or revoke the DEA registrations of physicians and pharmacies in administrative cases.  However, some judges have expressed a reluctance to admit such “bean counting” or naked numbers as being irrelevant, when not supported by testimony or evidence placing the numbers into context with other factors, such as the physician’s practice, patient mix, standards of treatment, severity of illness, etc.

In the federal court case now pending, Cardinal has stated in papers filed that it has a “robust” detection system and has cut off more than 330 pharmacies, including 140 pharmacies located in Florida, over the past four years that it decided posed an unreasonable risk of diversion.

In a news article posted late on February 29, 2012, the Associated Press advised that federal Judge Reggie Walton had ruled against Cardinal Health earlier in the day.  Apparently Cardinal Health had originally obtained a “stay” (sometimes referred to as a “temporary restraining order” or “temporary injunction”) against the DEA’s suspension order.  However, after a hearing held on February 29 in which Cardinal Health sought an injunction against the DEA’s enforcement of its suspension, Judge Walton announced a decision form the bench.  He reportedly refused to grant Cardinal Health an injunction against the DEA, apparently agreeing with the DEA’s position.

This battle between Cardinal Health and the DEA is an important one as it demonstrates the DEA continued efforts to attempt to exert more control over pain clinics, pain management physicians, pharmacists, pharmacies, and now, pharmaceutical distributors. If you believe that the DEA is investigating you, your facility, your company or if you want to learn more about the legal implications of pain management, visit our website to learn more.

Sources for this article included; the Orlando Sentinel, Boston Globe, Associated Press, USA Today and Florida Today.

Suspected Florida Pill Mills Continue to Attract Investigations

According to the Orlando Sentinel, some of the worst alleged pill mills in Florida are located in Orlando. At a small pain clinic near downtown Orlando and an affiliated office, one doctor prescribed more oxycodone during a three-month period in 2010 than all doctors in the state of California combined. Details about the clinic from former employees span a nearly 200-page affidavit filed in Orange County Circuit Court in the racketeering case against doctors and management of this pain clinic. The documents offer a rare glimpse inside the investigation.

In this case, agents examined bank records, Crimeline tips and records from the Medical Examiner’s Office. Additionally, FDLE and Metropolitan Bureau of Investigation agents gathered prescribing data from the U.S. Drug Enforcement Administration, pulled state corporation filings and viewed Department of Health records. Agents obtained the prescribing histories for 75 patients who got their drugs at Walgreens and found that 64 had criminal records. Of those, 42 have been arrested for drug-related crimes.

In addition to exploring paper trails, agents and investigators employed more-traditional law enforcement tactics, including undercover investigations. Posed as patients, undercover MBI agents were prescribed painkillers with little or no medical assessment. While waiting for their turns to see the doctors in the clinics, they overheard patients in the lobby talk about selling drugs.

Undercover agents said there were other indications that this pain clinic was a pill mill. There were long lines outside; armed security guards; and signs that warned patients they needed to bring empty pill bottles and posted what medications were available and a price list for the pills. The pain clinics were a cash business. Insurance was not accepted, and employees told agents the price per visit ranged from $160 to $350.

The original target of this investigation was one of the doctors at the pain clinic, but as agents gathered intelligence, it became clear they needed to learn more about the owners and management.

According to the investigation, the management recruited doctors to work at the clinics, but court documents show they had a problem retaining them. A man who used to work at a nearby business told agents that one of the owners complained to him that doctors were quitting and suggested he would hire the man to pretend to be a doctor at the clinic. 

The investigation of this pain clinic resulted in the arrest of the owners and doctor involved in allegedly overprescribing narcotics. As federal, state, and local agencies continue their mission to eradicate pill mills, more pain clinics will be involved in investigations.

If you are concerned about your pain clinic, or if you are a doctor practicing pain management at a pain clinic, please call us today at (407) 331-6620 or (850) 439-1001.