For the first time ever, the U.S. DEA targeted a prescription drug manufacturer for their role in black market opioids and damages incurred. Mallinckrodt Pharmaceuticals, one of the largest national manufacturers of the highly addictive generic painkiller oxycodone, one of the leading drugs responsible for the more than 15,000 overdose deaths in 2015, was accused of shirking its responsibility to report suspicious drug orders.
Who’s to Blame For The Opioid Epidemic?
Shirking Responsibilities?
Under federal law and DEA policy, pharmaceutical companies are required to “know their customers,” monitoring amounts, frequencies, and patterns of drug orders, immediately notifying the DEA of suspicious activity – or risk losing their license to manufacture and sell controlled substances, as well as civil and criminal penalties. Though Mallinckrodt maintained publicly the company has worked hard to fight drug diversion, internal case summaries prepared by federal prosecutors indicated Mallinckrodt’s response was that ‘everyone knew what was going on in Florida but they had no duty to report it.’ Sources familiar with settlement talks indicated Mallinckrodt acknowledged its responsibility to report suspiciously large orders, but contended the DEA did not require manufacturers to know about (or be responsible for) ‘their customers’ customers,’ further pointing to conflicting DEA advice as to legal responsibilities. Prosecutors considered a whopping 43,991 unreported orders from distributors and retailers suspicious.
Uncharted Waters
Appalled by the rising opioid death toll, the DEA’s push to hold drug manufacturers accountable was hoped to be a wake-up call, putting the industry on notice for its responsibilities in the diversion of drugs to the black market. Instead, after years of industry investigations spanning five states to build the massive case, the results mirrored the DEAs previous attempt to hold wholesale distributors accountable. The case stalled. Fierce company resistance and intense lobbying efforts may have played a role in the lack of legal action pursued. The case settled for $35 million in fines and no admission of wrongdoing.
Small Potatoes
The proposed settlement, a mere fraction of the 44,000 federal violations pointed to in the investigation which could have cost the company $2.3 billion in fines, amounts to small potatoes for a company that posted $3.4 billion in revenue and $489 million in profit in 2016. In a later February 2017 SEC filing, Mallinckrodt even noted the investigation “will not have a material adverse effect on its financial condition” because it had set aside the funds.
About the Author: Anthony Sambucini is a founding principal and the Chief Executive Officer of ANS Solutions. Anthony specializes in bridging the goals of clinical innovation and business strategy that have helped propel ANS Solutions into a national leader in Pharmacotherapy Review Services for workers’ comp insurers and ANS Pharmacotherapy Review Program is the most advanced, results-oriented drug utilization review program in the industry. As a consultant to insurance carriers and attorneys, Anthony customizes services based on the particular needs of the client and oversees all activities related to business development and company operations. For more information about ANS Solutions visit http://ans-solutions.com/.
SOURCES:
https://www.washingtonpost.com/graphics/investigations/dea-mallinckrodt/?_hsenc=p2ANqtz-9DxkF3wbuslmavvDf3o8CSw_0KLDObRAx7Ah4JgQ2Vi7_84yvAVhoUcmcpQyMQ-LDuL7935zGFyhc7J8njQ-cALSVCEg&_hsmi=51277531&utm_campaign=Rx%20Summit&utm_content=51277531&utm_medium=&utm_source=hs_email&utm_term=.ebaec91ff136
http://www.reuters.com/article/us-mallinckrodt-settlement-idUSKBN1751JM
https://www.opensecrets.org/lobby/clientsum.php?id=D000022900
Original content posted on http://ans-solutions.com/government-struggles-to-hold-opioid-manufacturers-accountable/
