McKesson Corporation, a pharmaceutical distributor and medical supply company based in San Francisco, CA, has agreed to pay a historical fine to settle an investigation into reports that the company violated their own compliance measures and did not report suspicious orders of painkillers.
The company agreed to pay $150 million civil penalty for their alleged violations. In 2008 the company paid $13.25 million in a similar settlement after allegations that the company did not have a system in place to detect and report suspicious orders of painkillers. Following that they created a compliance program, and according to the investigation they did not implement or stick to their own program. They continued to supply pharmacies with large or frequent orders of painkillers, specifically oxycodone and hydrocodone. Those drugs play an integral part in the ongoing opioid addiction crisis that the nation is facing.
In addition to the penalties they agreed to stop distributing these substances in Colorado, Ohio, Michigan and Florida for multiple years. In Colorado alone McKesson processed 1.6 million orders and flagged 16 as suspicious, less than one percent of all orders.
“In many instances, the suspicious orders placed by West Virginia pharmacies resulted in prescription narcotics being diverted for illegal use and abuse,” said Betsy Steinfeld Jividen, the acting U.S. attorney in northern West Virginia whose office was involved in the case.
The settlement also involves enhanced compliance measures for McKesson. They have agreed to strict staffing and organizational improvements, audits, and will face financial penalties if they fail to stick to the terms of their compliance measure. The company will have to utilize an independent monitor to assess their compliance. This is a measure that has never been taken before in a civil penalty settlement involving the Controlled Substances Act.
Many Drug Enforcement Agency (DEA) field divisions were involved in the investigation, and U.S. Attorneys’ Offices for the District of Colorado and the Northern District of West Virginia and the DEA Office of Chief Counsel and Diversion Control Division led the civil settlement negotiation.
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