drug-company-criminally-charged-opioid-epidemic

Major Drug Distribution Company Criminally Charged – What Does This Mean?

News broke late April about Rochester Drug Co-Operative, and its former chief executive and another top executive being criminally charged with conspiracy to violate narcotics laws, conspiracy to defraud the U.S., and willfully failing to file suspicious order reports. The major drug company criminally charged is being investigated further in New York.

What we know:

  • Both former executives face life in prison for failing to file suspicious order with the Drug Enforcement Administration.
  • This prosecution is the first of its kind – that is, “executives of a pharmaceutical distributor and the distributor itself have been charged with drug trafficking (and) trafficking the same drugs that are fueling the opioid epidemic.”*
  • Between 2012 and 2016 the drug company was accused of distributing tens of millions of doses of oxycodone, fentanyl and other opioids that their own compliance department flagged for the pharmacies having no legitimate need for them.
  • Prosecutors said what lead to this was practitioners working for the company acted outside of the scope of their medical practices, which they are now under investigation for.
  • The drug company purposely hid the red flags from the DEA to prevent pharmacy investigations and from potentially losing clients.
  • The company identified more than 8,000 potential orders of interest, either by size, frequency or pattern, however only one was reported.
  • During this 4-year period, RDC’s oxycodone sales grew from 4.7 million to 42.2 million, and fentanyl sales grew from 63,000 to 1.3 million.
  • Due to the growth, the former chief executive’s compensation rose to $1.5 million a year.
  • A spokesperson for RDC said the major downfall leading to these charges was not having adequate systems in place nor were there compliance team and practices rigorous enough to provide controls and oversight over the increased demand for narcotic drugs.

So now what?

Many times we see others thinking they’ll be the next drug company criminally charged because they don’t understand the regulations put in place by the DEA. And often, we see many smaller manufacturer, distributor and other pharmaceutical companies who don’t have the resources for a robust compliance team. So, what can keep companies on track is a robust software that monitors and tracks order data, and immediately reports anything marker suspicious. Not allowing any orders to slip by, or only having one person manage the system. If an order was flagged in an SOM software, it would have immediately been suspended from fulfillment and someone would have to go in, approve, adjust or completely reject the order, leaving an explanation as to why. They also would have been able to utilize previous order data from the permanent repository to gauge past, present and future orders to help make safe operating decisions.

Lately, so many investigations and compliance issues are due to human-error or lack of clear step-by-step protocols to follow when issues like this arise. This can be reduced when multiple users have access to the “order of interest” software workflow.

“Software that can help pharmaceutical companies identify, locate, suspend and investigate orders of interest in an easy-to-use environment is a key component to staying off of the DEA’s radar,” says e-SupplyLink CEO, Todd LaBonte. “DEA regulations can be an intimidating field to maneuver alone and, even more, a costly industry if operating without safety precautions.”

We have been helping companies operate safely within the scope of DEA regulations for more than 10 years. Our solution gives our clients the ability to select which administrators have access to the dashboard so profit doesn’t get ahead of ethics and safety. Having a robust software with customization capabilities would have protected this manufacturer. SOM software is all about supporting the compliance team or individual and giving them the control. We’ve worked with several users to understand their needs and worries, and apply order testing based on those discussions. We make order processing a team effort and ensure everyone using SOMLink is fully trained to maximize the investment. SOMLink has proven to be universally applicable, yet locally adaptable and continues to be a reliable source for identify orders of interest.

 

Keep reading: Pharmaceutical Ethics – Where Modern Day Practices Stand.

 

*Read the full NBC investigation article here.

dea-regulations-folder-jpg

Pharmaceutical Ethics – Where Modern Day Practices Stand

Lately, when looking at pharmaceutical ethics, many organizations focus on quantity and not quality of orders. Attempting to fill as many as possible in the spirit of competition; which leads to companies mismanaging orders and wrong orders being filled. An article in the latest Pharmaceutical Technology magazine provoked the question: Whose responsibility is it to regulate the quality and legitimacy of drug orders?

This question has 15 different responses: is it the DEA, pharmaceutical manufacturing manager, supply chain laborers, or the end customer? The unknown is troubling to the pharmaceutical industry. There is no role of agreement when it comes to regualtions. So, how will the DEA’s code of federal regulations be followed by drug manufacturers? When companies encounter an issue with an order, they mainly work to solve the individual citation, but fail to look at the what’s potentially causing it. Allowing the chance for it to happen again. The most effective solution for quality assurance and compliance strategies begins with robust internal procedures. And that could be as simple as dedicating part of the manufacturing and distributing process to monitoring activity of their customers.

“People complain that quality costs money, but if they really want to see how expensive things can be, they should try a consent decree.” – Chris Moreton, FinnBrit Consulting

The Problem:

With the opioid epidemic growing exponentially, the DEA instituted a federal regulation that all manufacturers and distributors must check their client has the agency’s authorization to possess controlled substances. This mandate opens a need for supply chain monitoring personnel, as a result, requires minor adjustments throughout supply chain procedures. Processes and procedures are not carved into stone, and need to be continually adapted to industrial needs and requirements. A combination of strong personnel training, keeping tools and equipment updated, having a strong quality unit, and developing a quality company culture at all levels allow for a smooth adoption of change. Similarly, there should be on-the-job training and oversight on a continual basis to reduce companies’ risk.

Consequently, one of the biggest difficulties in maintaining good manufacturing practices is complacency. “Once a process or procedure is established and functional, there does not seem to be the impetus to update and revise it,” says Susan Schniepp, executive vice president of Post-Approval Pharmaceuticals. General practices that have been in place at a company for a good length of time are hard to revise. One option companies use to update their GMPs is establishing a policy that ties failure to follow procedures with an internal audit and detect improper performance. A better option to explore is upgrading company tools and equipment, especially computer-driven programs, to monitor manufacturing practices. New technologies and new product types may necessitate an update to procedures.

Where The Responsibility Lies:

The DEA planted regulations on all prescription drug manufacturers and distributors. It doesn’t verify incoming orders, rather the agency investigates orders that come across as suspicious. It has tasked the manufacturers and distributors with complying with the regulations, or face several large fines for supplying illegitimate customers. Repeat mistakes, often caused by tunnel vision, stem from a lack of monitoring orders and from “know your customer” protocols. Today, a pharmaceutical supply chain has to be in constant communication with every department. Applying vertical and horizontal communication principles passes information from the DEA, to company administrators, on down through the company. Through fostering communication between employees on several levels helps ensure the supply chain is a smooth operation.

Developing and Maintaining New Procedures:

Change is inevitable, especially when the industry is facing unheard of fines on the horizon of an epidemic. One way to incorporate new policies and procedures is to involve all parties in the process of developing them. What new protocols need followed when fulfilling orders? One way to combat an overwhelming change is to seek the help of professionals because the concept of suspicious order monitoring is new for companies and the fine print in the regulations can be intimidating. The first step is having a solid understanding of where your current order-manufacturing process is at. Having the knowledge of your employees’ abilities is crucial before incorporating new software because it informs management of the best way to introduce and train staff on suspicious order monitoring software.

At e-SupplyLink, we are those professionals your company requires. We work with DEA agents to ensure our suspicious order monitoring software complies with the federal regulations for controlled substances. Which means less work for your company. SOMLink has been on the market for eight years and continues to be a leader in suspicious order monitoring. To keep procedural alterations to a minimum, we integrate our software into existing EDI translators and ERP management systems.