A record settlement for failing to report “suspicious” drug orders also requires one of the country’s largest pharmaceutical distributors to temporarily suspend sales from a Florida distribution center.
McKesson Corp. agreed to pay a record $150 million civil penalty for alleged violations of the Controlled Substances Act (CSA), the U.S. Attorney’s office for the Middle District of Florida announced this week.
“Drug Enforcement Administration investigators determined that McKesson failed to report pharmacy orders at its Lakeland, Florida distribution center for hydromorphone that dramatically exceeded historical sales levels by the ordering pharmacies,” the release stated.
The release called the staged suspensions “among the most severe sanctions ever agreed to by a DEA registered distributor.”
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“This landmark $150 million settlement is the latest example of our ongoing efforts to fight prescription opioid abuse in the Middle District of Florida,” said United States Attorney A. Lee Bentley III in a release.
The settlement, not the first for McKesson, resolved claims regarding McKesson’s “monitoring and reporting of suspicious controlled substance orders,” a release from the company stated. More specifically, supplying pharmacies with “an increasing amount of oxycodone and hydrocodone pills from 2008 to 2013,” the U.S. Attorney’s Office release stated.
Out of 1.6 million orders processed in Colorado between June 2008 and May 2013, only 16 were reported as suspicious, all connected to one customer.
In addition to the monetary component, the settlement requires the company to “suspend sales of controlled substances from distribution centers” in Florida, Ohio, Michigan and Colorado for multiple years, according to the release.
McKesson noted enhanced compliance terms for the next five years along with “specific, rigorous staffing and organizational improvements; periodic auditing; and stipulated financial penalties for failing to adhere to the compliance terms.” McKesson is also required to assess compliance with an independent monitor and plan to meet with the DEA regularly over the next five years.
“Pharmaceutical distributors play an important role in identifying and combating prescription drug diversion and abuse. McKesson, as one of the nation’s largest distributors, takes our role seriously. We continue to significantly enhance the procedures and safeguards across our distribution network to help curtail prescription drug diversion while ensuring patient access to needed medications,” said John H. Hammergren, chairman and chief executive officer of McKesson said in a release posted to their website.
McKesson cited the “interest of moving beyond disagreements” about whether the company was complying with regulations for controlled substances as part of the reason behind the agreement.
The company also paid a $13.25 million civil penalty and administrative agreement in 2008, according to the release.
After the settlement for similar violations, a compliance program was designed, but the investigation found McKesson “did not fully implement or adhere to its own program.”