Holiday CVS, L.L.C., d/b/a CVS/Pharmacy Nos. 219 and 5195; Decision and Order

Federal RegisterOct 12, 2012

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DEPARTMENT OF JUSTICE

Drug Enforcement Administration

[Docket Nos. 12-37 and 12-38]

Holiday CVS, L.L.C., d/b/a CVS/Pharmacy Nos. 219 and 5195; Decision and Order

On June 8, 2012, Chief Administrative Law Judge (ALJ) John J. Mulrooney II, issued the attached Recommended Decision. Both parties filed Exceptions to the ALJ's decision.

Having considered the record in its entirety, including the parties' Exceptions, I have decided to adopt the ALJ's recommended rulings, findings of fact (except as discussed below), conclusions of law, and proposed sanction. A discussion of Respondents' Exceptions follows.

All citations to the ALJ's Recommended Decision are to the slip opinion as issued by him.

Respondents' Exceptions

Respondents raise numerous exceptions to the ALJ's Recommended Decision. Of their contentions, the most substantial, but ultimately still unpersuasive, are the following:

(1) That their conduct in dispensing controlled substance prescriptions issued by two physicians, whose DEA Registrations were “expired” and therefore invalid, “cannot serve as a basis for revocation,” Resp. Exceptions at 2-9;

(2) that the ALJ's findings that Respondents dispensed controlled substances pursuant to prescriptions, which raised red flags that a pharmacist could not resolve, and thus violated their corresponding responsibility under federal law, are not supported by substantial evidence,

id.

at 9-22; and

(3) that the ALJ failed to consider evidence of their acceptance of responsibility,

id.

at 22-25.

Exception One—Respondents' Dispensings of Controlled Substance Prescriptions Issued by Physicians Whose Registrations Were “Expired” Does Not Support the Revocation of Their Registrations

The evidence showed that both Respondents dispensed numerous prescriptions which were issued by two physicians, Dr. Anthony Wicks and Dr. Ronald Lynch, who no longer held their DEA registrations and thus could not lawfully prescribe controlled substances under federal law.

See

21 CFR 1306.03(a) (“A prescription for a controlled substance may be issued only by an individual practitioner who is * * * [e]ither registered or exempted from registration pursuant to §§ 1301.22(c) and 1301.23 of this chapter.”). More specifically, with respect to Dr. Wicks, the evidence showed that his registration expired on May 31, 2011. Yet, between June 6 and July 15, 2011, Respondent CVS #219 dispensed thirty-eight prescriptions issued by Dr. Wicks for oxycodone 30 mg. Likewise, between June 7 and July 14, 2011, Respondent CVS #5195 dispensed seventeen prescriptions issued by Wicks for oxycodone 30 mg.

While Respondent also characterizes Dr. Lynch's registration as “expired,” the record shows that Lynch's registration had, in fact, been revoked following a hearing under 21 U.S.C. 824(a). More specifically, on December 3, 2010, the Agency issued a Decision and Final Order, which revoked Dr. Lynch's registration with an effective date of January 18, 2011, based,

inter alia,

on findings that he violated 21 CFR 1306.04(a) by issuing controlled substance prescriptions outside of the usual course of professional practice and which lacked a legitimate medical purpose; this decision was published in the

Federal Register

on December 16, 2010. GX 31;

see also California

FERC,

329 F.3d 700, 707 (9th Cir. 2003) (“Publication in the

Federal Register

is legally sufficient notice to all interested or affected persons regardless of actual knowledge or hardship resulting from ignorance, except those who are legally entitled to personal notice.”).

In response to the testimony of an Agency's Investigator that at a December 2010 meeting with various CVS representatives regarding the diversion problem, she discussed how the pharmacies could check the status of DEA registrations through the Agency's Web site, Respondents elicited testimony from the Investigator that CVS's representatives told her that its pharmacies do not have internet access.

See

Tr. 73. However, surely someone in the CVS corporate hierarchy has internet access and the ability to check either the Agency's Web site (or that of the

Federal Register

) to determine whether the Agency has issued any recent Decisions and Orders revoking a practitioner's registration. That Respondents continued to fill Dr. Lynch's prescriptions for months after the revocation order became final also begs the question of what information the CVS Pharmacy Management Information System displayed regarding his registration.

So too, those who engage in a highly regulated industry are expected to keep informed of regulatory developments which affect their industry.

See United States

Southern Union Co.,

630 F.3d 17, 31 (1st Cir. 2010) (“[T]hose who manage companies in highly regulated industries are not unsophisticated * * *. It is part of [a company's] business to keep abreast of government regulation.”). Here, the Agency's publication of the revocation order in Lynch's case thus provided Respondents with reason to know that, effective January 18, 2011, Lynch would no longer be authorized to issue controlled substance prescriptions.

See Ralph J. Bertolino, d/b/a Ralph J.

Bertolino Pharmacy,

55 FR 4729, 4730 (1990).

Accordingly, Respondents' contention that the evidence does not establish that they (or their pharmacists) had actual knowledge of the revocation of Dr. Lynch's registration is wholly unavailing. Given that Respondents continued filling Lynch's unlawful prescriptions for more than six months after the Order became effective, and in the case of CVS #219 did so repeatedly, this conduct is sufficiently egregious to support the conclusion that Respondents committed acts which render their continued registrations “inconsistent with the public interest.” 21 U.S.C. 824(a)(4);

cf. United Prescription Services,

Inc.,

72 FR 50397, 50408-09 (2007) (“While filling a prescription issued by a practitioner whose registration had recently expired might be excusable, [pharmacy's] repeated filling of numerous prescriptions long after the expiration of [physician's] registration clearly was not appropriate and was unlawful.”).

By itself, this conduct is sufficient to conclude that the Government has made out a

prima facie

case for revocation. I therefore reject this exception.

That Dr. Lynch's registration had been revoked and had not simply expired, renders Respondents' conduct in filling the prescriptions even more egregious.

Exception Two—The ALJ's Findings That Respondents Dispensed Controlled Substances Pursuant to Prescriptions Which Raised Red Flags That Could Not Be Resolved and Thus Violated Their Corresponding Responsibility Under Federal Law Are Not Supported by Substantial Evidence

Respondents also contend that the record does not support the ALJ's findings that they violated their corresponding responsibility under federal law to dispense only those prescriptions, which have been “issued for a legitimate medical purpose by an individual practitioner acting in the usual course of his professional practice.” 21 CFR 1306.04(a). Respondents take exception to the ALJ findings because they “are based solely on the testimony of the Government's Expert * * * who stated that he found certain red flags on approximately fifty of the more than 25,000 prescriptions filled by Respondents to be ‘unresolvable.’ ” Resp. Exceptions, at 9. Respondents contend that “[n]o other witness, no case law, no Administrator decision, and no published DEA guidance supports [the Government Expert's] claims that certain red flags are `unresolvable' on their face.”

Id.

at 9-10. Respondents further argue that the testimony of the Government's Expert

“is unreliable and biased and cannot by itself provide sufficient evidence to satisfy the Government's burden of proof.”

Id.

at 10.

Finally, Respondents contend that “the Government's `unresolvable' red flag argument—adopted in full in the ALJ recommendation—improperly shifts the burden of proof to Respondents.”

Id.

At the hearing, the Government presented extensive evidence showing that numerous persons, including persons who were not Florida residents, obtained prescriptions for both oxycodone 30 mg and alprazolam 2 mg from various South Florida physicians, whose offices were typically located 200 miles or more from Respondents (s

GX 62), which they then presented to Respondents' pharmacists and which Respondents filled, notwithstanding that there are numerous pharmacies between South Florida and Sanford (where Respondents are located). The evidence included multiple spreadsheets showing each Respondent's dispensings of the oxycodone (and in some cases alprazolam) prescriptions issued by various physicians.

A principal component of the Government's evidence was the testimony of its expert witness, Professor Paul Doering, who reviewed various dispensings made by the Respondents and opined as to whether the Respondents had complied with their corresponding responsibility to dispense only lawful prescriptions. Professor Doering, who has been a registered pharmacist in the State of Florida since 1973, currently holds the title of Distinguished Service Professor of Pharmacy Practice, Emeritus, of the College of Pharmacy at the University of Florida, and has been on its faculty since 1976. GX 6, at 1-2. He has also published extensively and presented numerous papers at professional meetings.

See id.

at 4-29.

The ALJ found credible Professor Doering's testimony that controlled substances are “high alert drugs” and that among controlled substances, drugs such as “opioids, benzodiazepines, [and] other central nervous system depressant drugs” require “the highest level scrutiny” on the part of a pharmacist who is presented with prescriptions for these drugs. Tr. 692; ALJ at 28. Professor Doering testified that in pharmacy practice, there are various red flags, which create “a level of concern that might cause a pharmacist to either choose not to fill a prescription or take some other kind of actions,” and that “the more red flags there are, the stronger that suspicion is.” Tr. 694. Professor Doering testified that while some red flags might be resolvable by checking a patient's identification or calling the prescriber, there are also circumstances in which calling the prescriber will not resolve the red flags because the red flags indicate that the prescriber is collaborating with the patient to divert drugs.

Id.

at 697-700.

Professor Doering specifically identified such red flags as including that the patient is paying for controlled substance prescriptions with cash,

id.

at 703;

the respective locations of the patient and the prescriber,

id.

at 701-02;

that a prescriber writes for certain combinations or patterns of drugs,

id.

at 708;

and multiple patients presenting “prescriptions for the same drugs, the same quantities * * * from the same doctor without any kind of variability or change considering the different patients that come into the pharmacy,” thus suggesting that the physician prescribes in a “factory like manner.”

Id.

Professor Doering reviewed the various spreadsheets of the prescriptions dispensed by Respondents and testified regarding whether Respondents could have lawfully dispensed various prescriptions given the red flags they presented. For example, when questioned about Respondent CVS #219's dispensing of oxycodone 30 mg prescriptions,

which were issued by a Fort Lauderdale-based physician (P.G.) for persons whose addresses were in Kentucky and Tennessee and who paid cash, Professor Doering opined that the multiple red flags these prescriptions presented could not be resolved so that a reasonable pharmacist could dispense them consistent with his corresponding responsibility under federal law.

Tr. 722-23.

Professor Doering acknowledged that “the doses of these medications (oxycodone 30 mg) are within therapeutic guidelines or limits, but, number one, it's just extremely suspicious to me that these are always 30 milligram tablets, always in large quantities. * * * [P]eople come in all shapes, sizes and degrees of infirmity, and it just is an attention getter when I see the same drugs from the same doctors from similar places coming through in a nonstop sort of way.” Tr. 776.

The specific prescriptions were either for 180 or 210 tablets of oxycodone 30 mg. The evidence showed that on August 13, 2010, Respondent CVS #219 dispensed such prescriptions to a resident of Harrogate, Tennessee and a resident of Ingram, Kentucky; that on August 16, 2010, Respondent CVS #219 dispensed such prescriptions to another resident of Harrogate, Tennessee, as well as three residents of Middlesboro, Kentucky (one of whom received 56 tablets of OxyContin 80 mg), and a resident of Dayhoit, Kentucky; and that on September 24, 2010, it dispensed more oxycodone 30 mg prescriptions to three Kentucky residents, including two who had the same last name and town of residence (Middlesboro), as well as three residents of Tennessee.

See

GX 57, at 33. Each of these persons paid cash.

Id.

As the ALJ found, the Government elicited additional testimony from its Expert regarding the prescriptions issued by other doctors which was to similar effect. For example, the Government noted that on August 29 and 30, 2010, Respondent CVS #219 filled prescriptions for either 210 or 240 tablets of oxycodone 30 mg for four Kentucky residents, all of whom paid cash, which were issued by a physician (L.A.) whose office address was listed as either in Miami or Fort Lauderdale. GX 57, at 15. Two of these individuals were from Clay City; the other two were from Stanton.

Id.

Regarding these prescriptions, Professor Doering testified that he could not “foresee any explanation for this set of red flags that would satisfy my professional obligation not to fill the scripts.” Tr. 754. When further questioned as to whether anything “could have been done to resolve the[] red flags” presented by these prescriptions, Professor Doering explained that “it's a conflagration or a combination of things that suggests to me that these prescriptions were not issued in the usual course of medical practice” and that nothing on the hard copy of the prescriptions “would change [his] opinion.”

Id.

at 757-58. And when asked by the ALJ if he was imposing a more stringent standard than the standard of a Florida pharmacist, Professor Doering testified that the standard he applied was “what they're taught in school,” and that in his “many conversations with similar pharmacies operating under similar circumstances * * * the feedback I get is universally consistent with my point of view.”

Id.

at 758.

The Government also noted that on August 19, 2010, Respondent CVS #219 filled four prescriptions for 180 tablets of oxycodone 30 mg for four Kentucky residents, which were issued by a physician (C.N.) whose address was listed as either being in Delray Beach or Deerfield Beach, two cities located in Palm Beach County. Tr. 759-64; GX 57, at 38. Here again, Professor Doering testified that the red flags could not be resolved and that no information on the hard copy of the prescriptions would lead him to change his opinion. Tr. 764.

Professor Doering likewise testified regarding dispensings that occurred at Respondent CVS #5195. More specifically, he addressed Respondent's dispensings on August 26, 2010, of several prescriptions for 180 tablets of oxycodone 30 mg written by a Dr. Jack

Danton

of Pompano Beach for three residents of Tennessee, two of whom shared the same last name and address in Knoxville, with the other being from the town of Mascot. GX 57, at 29. Professor Doering testified that the red flags associated with these prescriptions included that they were paid for with cash, the prescriptions were for “a high alert drug,” that the patients were “from out-of-state who apparently traveled a great distance to be seen in Pompano Beach,” and that the assigned prescription numbers were very close sequentially, suggesting that it was “most likely they were presented to the pharmacy within a very short time span.” Tr. 751.

While Professor Doering was not specifically asked whether the combination of red flags presented by the Danton prescriptions was resolvable, based on his earlier testimony that other prescriptions, which were issued for the same drug and in similar quantities to persons who had travelled from out-of-state to South Florida to obtain the prescriptions and then on to Sanford to fill them presented red flags which were not resolvable, I conclude that the red flags presented by these prescriptions were also not resolvable.

Dr. Danton's registration was subsequently revoked by the Agency following a hearing.

See Jack A. Danton,

76 FR 60,900, 60,922 (2011).

While the spreadsheet indicates that the prescriptions were subject to a “cash discount,” which apparently means that the patients were entitled to some type of group discount, I adopt the ALJ's finding that even if this red flag is eliminated from the factors which a pharmacist must consider, “the remaining red flags [we]re still unresolvable.” ALJ at 30-31n.54. So too, I adopt the ALJ's findings that while Professor Doering conceded that he did not know at what point the prescription numbers were assigned, the prescriptions at issue “were presented in proximity to one another.”

See id

at 31 n.55 (quoting Tr. 926-27).

Professor Doering further testified regarding Respondent CVS #5195's dispensings on August 11, 2010 of six oxycodone 30 mg prescriptions (all but one of which were for 180 tablets

), issued by a Dr. Carlos Gonzales of West Palm Beach to six Kentucky residents, all of whom paid cash.

GX 57, at 35. The evidence further showed that three of these persons lived in the same town (Stanton) and that two of them had the same last name and street address; another two were also from the same town (Danville).

Id.

When asked whether a reasonable and prudent pharmacist in Sanford would want to resolve the red flags presented by these prescriptions before dispensing them, Professor Doering answered: “If it's resolvable. I think I've testified already that there's no explanation that's going to resolve that in my mind.” Tr. 916.

The other prescription was for 150 tablets. GX 57, at 35.

Respondents argue that the ALJ improperly relied on three of the six controlled substance prescriptions that were issued by Dr. Gonzales and dispensed by Respondent CVS #5195 on August 11, 2010, because Professor Doering did not specifically address all six of them in his testimony. Resp. Exceptions, at 27. However, having identified those circumstances presenting red flags, which according Professor Doering could not be resolved, the ALJ could reasonably apply this testimony in assessing the lawfulness of Respondents' dispensings of other prescriptions that presented similar unresolvable red flags.

Professor Doering further testified that “Interstate 95 has been renamed the Oxycodone Express because of the brisk travel of people from Kentucky, Tennessee, [and] Ohio to South Florida to obtain medications.” Tr. 775. He also testified with respect to these dispensings that:

Well, once again this is a clinic that's at a distant site from someone living in Kentucky, and I don't think it's any secret that—I haven't used the term yet, I won't use the term—I'll call them pain management clinics that are known to be—what should I say—fairly easy to get controlled substance prescriptions from.

Id.

The Government also introduced an eighty-one page spreadsheet of the controlled substance prescriptions which were written by a Longwood, Florida physician and filled by both Respondents.

The spreadsheet documents numerous instances in which both Respondents filled two or more controlled substance prescriptions that the physician typically wrote for 168 tablets of oxycodone 30 mg and 56 tablets of alprazolam 2 mg; moreover, in many instances, the patients received a third prescription for 56 tablets of oxycodone 15 mg.

See

GX 55.

The spreadsheet was provided by CVS to a DEA Group Supervisor, who then provided it to an Agency Investigator. Tr. 485. While the Investigator subsequently removed the title of the original document, she did not change the substantive information.

Id.

The Government then asked Professor Doering for his opinion regarding the red flags that were presented by this doctor's prescriptions and directed his attention to several prescriptions that each Respondent filled on December 23, 2010. More specifically, the Government noted the prescriptions that Respondent CVS #219 filled for patients T.F. and A.T., each of whom received 168 tablets of oxycodone 30 mg, 56 tablets of oxycodone 15 mg, and 56 tablets of alprazolam 2 mg; s

GX 55, at 15, 47; as well as the prescriptions that Respondent CVS #5195 filled for patients C.H. and J.R., each of whom also received 168 tablets of oxycodone 30 mg, 56 tablets of oxycodone 15 mg, and 56 tablets of alprazolam 2 mg.

See id.

at 62, 74.

Nor were these the only patients who, on the same date, filled at Respondents, prescriptions for the same combination of drugs which they obtained from this physician.

See

Tr. 787-91 (discussing patients B.D., A.H., R.M., J.W., each of whom, on January 6, 2011, filled prescriptions at CVS #219 for 168 tablets of oxycodone 30 mg, 56 tablets of oxycodone 15 mg, and 56 tablets of alprazolam 2 mg).

Regarding these prescriptions, Professor Doering Expert testified that from the perspective of “a clinical pharmacist * * * that combination of drugs is * * * a red flag because [a]lprazolam and oxycodone are commonly diverted to nonmedical use.” Tr. 784. As for the two oxycodone prescriptions each person obtained, Professor Doering explained that while “one might speculate that the reason for that is that pain can vary throughout the day and it may be that the individual is suggested to take the 15 [mg tablets] when the pain is not so great and 30 [mg tablets] when it is so great,” the “30 milligram tablets are scored right down the middle, and it's quite easy to break them in half.”

Id.

Professor Doering thus explained that prescribing both fifteen and thirty milligram strengths of the drug “just doesn't make any sense.”

Id.

He also testified that pill cutters are widely available in pharmacies and that it is common for doctors to prescribe a stronger strength of a drug to save money and instruct their patients to cut the drug in half.

Id.

at 786.

Professor Doering further testified that the prescribing patterns of this physician “would suggest that the one size fits all concept was in the” physician's mind, and that this was “highly suspicious” because “you see the same drugs, the same quantities, the same patterns over and over again.”

Id.

at 784-85. Indeed, while the Government questioned Professor Doering about only a few of the prescriptions, the eighty-plus page spreadsheet manifests that this physician repeatedly engaged in the pattern prescribing of oxycodone with alprazolam and frequently provided these persons with prescriptions for both oxycodone 30 mg and 15 mg.

Moreover, this was not the only physician who engaged in the pattern prescribing of oxycodone and alprazolam and whose prescriptions

were filled by Respondents.

See, e.g.,

GX 35.

To counter the testimony of the Government's Expert, Respondent called one of their own, Professor Brushwood, who is also a member of the faculty at the University of Florida College of Pharmacy. The ALJ carefully reviewed Professor Brushwood's testimony and thoroughly explained why he did not find his testimony to be more persuasive than that of Professor Doering on the material issues of whether certain red flags presented by the prescriptions were unresolvable and whether Respondents' pharmacists dispensed controlled substance prescriptions when they had reason to know that the prescriptions lacked a legitimate medical purpose and were not issued in the usual course of professional practice.

See

ALJ at 42. Having reviewed the record and the ALJ's reasoning, I agree with the ALJ's discussion of the weight he gave the testimony of each party's expert.

Respondents take exception to the ALJ's reliance on Professor Doering's testimony. Resp. Exceptions, at 18-22. More specifically, they assert that Professor Doering's testimony is unreliable because he did not use a reliable methodology in formulating his opinions.

Id.

at 18-21. They also assert that Professor Doering's testimony is biased because he acknowledged having testified for the Government in “virtually all” of the cases in which he has testified as an expert.

Id.

at 21-22.

As for the claim of bias, Respondents' argument provides no reason to reject the ALJ's credibility determination. The mere fact that Professor Doering has consistently testified for the Government is not sufficient to prove bias.

As for the claim that Professor Doering's testimony was unreliable, Respondents contend this is so because he “spent insufficient time reviewing the dispensing data,” “failed to review (or to request) any hard-copy prescriptions,” “relied on data pre-selected by the Government instead of conducting an independent evaluation of all of the data available,” and that he “fundamentally misunderstood the data he reviewed.” Resp. Exceptions, at 20. Respondents' contentions are not persuasive.

As for the first assertion, Respondents note that “Professor Doering spent fewer than ten hours reviewing” the dispensing data.

Id.

at n.9. However, Respondents offer no explanation as to why this was insufficient to review the data.

With respect to the second assertion, given that much of Professor Doering's testimony centered on certain prescriptions that presented a collection of red flags that no reasonable and prudent pharmacist could resolve so as to lawfully fill the prescriptions, his failure to review the hard-copy prescriptions is of no consequence. As Professor Doering testified with respect to several of the prescriptions, the fact that he was not provided with the hard copy prescriptions did not affect his opinion because “[t]here's nothing that I could gain from that review that would change my opinion.” Tr. 758.

As for Respondents' claim that Professor Doering relied on data which was pre-selected by the Government rather than conduct an independent evaluation of all of the available data, Respondents cite to his testimony that the Government provided him with a spreadsheet that listed the cash-only transactions. Resp. Exceptions, at 20 n.11 (citing Tr. 849:8-852:18). Respondents' counsel then asked Professor Doering whether “when the Government provided that information to [him] they also consider[ed] cash discount to be the same thing as cash?” Tr. 851. Professor Doering answered that he could not “remember” and added that he did not do anything to look at the individual prescriptions and determine which ones were actually paid for with cash.

Id.

The evidence showed that the term “Cash Discount” referred to those transactions in which a patient presented a discount card such as from the AARP. It is not clear why a person's presentation of such a card would make the transaction any less suspicious if other red flags were present.

Respondents' argument gains no traction because Professor Doering subsequently explained that even if a patient presented a card entitling him to a cash discount, this would not address the other red flags which may have been present. Tr. 924. As Professor Doering further testified, “you have to look at it in totality of the issues that give you reason for concern.”

Id.

at 924-25. And with respect to the prescriptions that he discussed during his direct examination, Professor Doering explained that even after eliminating the red flag of cash payments, there were still other red flags present which could not have been resolved so as to lawfully dispense the prescriptions.

Id.

at 925.

Respondents also note that Professor Doering acknowledged on cross-examination that he did not know how CVS assigns prescription numbers. Resp. Exceptions, at 20 & n.12. However, this does not provide reason to reject his testimony, because there were ample other red flags presented by the prescriptions, especially by those which were presented by persons who gave out-of-state addresses as their residences and yet had obtained their prescriptions from a doctor located in South Florida.

Thus, contrary to Respondents' contention, Professor Doering's testimony, coupled with the evidence he reviewed, is more than enough to satisfy the Government's burden of proof. Moreover, the Government elicited additional testimony that, while it did not address any specific prescriptions, provides further support for the conclusion that Respondents' pharmacists repeatedly dispensed prescriptions when they had reason to know that the prescriptions lacked a legitimate medical purpose and were issued outside of the usual course of professional practice. 21 CFR 1306.04(a).

More specifically, on October 18, 2011, DEA Investigators served Administrative Inspection Warrants at both Respondents and interviewed various employees of each store's pharmacy departments including their pharmacists-in-charge. At CVS #5195, a DEA Investigator (DI) interviewed Ms. Jessica Merrill, its pharmacist-in-charge. Tr. 227. Ms. Merrill stated that “she could fill oxycodone * * * prescriptions all day long, but rather than doing that, she had decided to set a limit * * * each morning” on the number of prescriptions the store would fill for oxycodone (as well as alprazolam), which was based on the available inventory of oxycodone and the amount of staff on hand.

Id.

at 229-30. Ms. Merrill stated that “once the limit [wa]s reached,” customers who then presented oxycodone prescriptions were told the store was out-of-stock even when it still had stock on hand.

Id.

at 230. Ms. Merrill further stated that “the limit [was] basically based upon a first-come, first-served system” and that as a result, “customers would start staggering in at 8:02 a.m. to present their prescriptions.”

Id.

at 230-31.

At approximately 10:30 a.m. on the day the IAW was served, the DI encountered a person in a massage chair, who related that he had come to the store to fill an oxycodone prescription only to be told by a pharmacy technician that the pharmacy was out of stock. Tr. 221. However, because the Investigators had counted the stock of oxycodone, the DI knew this was not true.

Id.

at 222-23. Upon asking the pharmacy technician why she had told the person this, the technician explained that the store placed a limit each morning on the number of oxycodone prescriptions it would fill that day.

Id.

at 223-24.

When asked by the DI why she was limiting the number of prescriptions the store would fill as the store still had oxycodone in inventory, Ms. Merrill replied that “she had to keep a certain amount of oxycodone on hand to fill prescriptions * * * for her real pain patients.”

Id.

at 231-32. According to the DI, she then asked Ms. Merrill why she would fill prescriptions “from these not-real pain patients.”

Id.

at 233-34. Ms. Merrill replied that “as a pharmacist she was stuck between a rock and a hard place, and that basically * * * she had not been trained to diagnose,” and that if she or her staff were “able to confirm that a prescription had been issued by a physician who was licensed by the state, and had a DEA license, then . . . [the pharmacy] should be able to trust that that prescription—or that physician is legitimate, and that the doctor * * * ha[d] given the correct diagnosis.”

Id.

at 234.

Ms. Merrill further acknowledged that patients were presenting patterns of prescriptions that included oxycodone, an anti-anxiety medication, and a muscle relaxant; she also admitted that “a lot of these customers were paying for their prescriptions in cash.”

Id.

at 238. When questioned by the DI as to why the patients were using cash

instead of insurance, Ms. Merrill stated “most of them are unemployed.”

Id.

When the DI then asked how the patients could afford to pay for hundreds of dollars-worth of prescriptions if they were unemployed, Ms. Merrill stated that she did not know.

Id.

However, when the DI suggested that the patients might be selling their pills, Ms. Merrill said: “I know.”

Id.

The DI further testified that she had obtained the prescriptions that the pharmacy had accepted for filling that day,

id.

at 226, and that upon reviewing them, observed that “[t]he prescriptions from one particular physician's office basically appeared to be all for the same quantity and the same combination of drugs.”

Id.

at 239. However, when she discussed this with Ms. Merrill, the latter “basically stated that * * * as a pharmacist, she is not trained to diagnose, and it's up to the doctor to determine whether or not they need a prescription.”

Id.

The DI also observed that some of the prescriptions were issued by a physician located near or in Orlando for a patient from Daytona Beach.

Id.

at 240. The DI then asked Ms. Merrill whether she found it “a little odd” that the patients had presented their prescriptions in Sanford,

given that there are CVSs all over central Florida and that the patients “obviously passed multiple CVSs coming from the doctor.”

Id.

Ms. Merrill, however, did not “know why they did that.”

Id.

The DI testified that the distance between Orlando and Sanford was “a little less” than 30 miles. She further testified that in her experience patients fill their prescription at pharmacies located either near their doctor's office or near their residence.

On October 28, 2011, the DI also participated in an interview of other employees of the Respondents at the local DEA field office, including Mr. Paras Priyadarshi, the pharmacist-in-charge at Respondent CVS #219.

Id.

at 244-45.

According to the DI, the prescription records for CVS #219 showed that it was “basically filling prescriptions for the same type of cocktail prescribing pattern that CVS #5195 had been dispensing,” namely combinations of oxycodone, alprazolam, and carisoprodol.

Id.

at 247. When asked whether he found it “odd that all of these practitioners in the area” that the pharmacy was “filling for,” were writing prescriptions for the same combination of drugs “to all these different patients,” Mr. Priyadarshi answered that he did not find it odd and that this was the combination of drugs these doctors prescribed.

Id.

at 248.

Nor did Mr. Priyadarshi find it odd that when “prescriptions came from a specific doctor, every single patient had the same ailment.”

Id.

at 250. And when asked whether the patients asked for a certain brand of drugs, Mr. Priyadarshi stated that the patients “would come in and ask for the `Ms' or the `blues',” which are street slang references to the thirty milligram oxycodone tablets manufactured by Mallinckrodt.

Id.; see also id.

at 254 (testimony regarding statements of Susan Masso, another pharmacist who worked at Store #219). However, Mr. Priyadarshi did not find it suspicious that patients would use street slang to ask for thirty milligram oxycodone.

Id.

at 256, 264.

At the time of the interview carisoprodol was not a controlled substance under federal law. On December 12, 2011, DEA issued a final rule placing carisoprodol in schedule IV of the Controlled Substances Act, effective January 11, 2012.

See Schedules of Controlled Substances: Placement of Carisoprodol Into Schedule IV,

76 FR 77,330 (2011). However, during the relevant period, carisoprodol was a controlled substance under Florida law.

See

Fla. Stat. § 893.03(4)(jjj) (2010). Moreover, several Agency decisions had discussed the abuse of carisoprodol when taken as part of a drug cocktail which includes oxycodone and alprazolam.

See East Main Street Pharmacy,

75 FR 66,149, 66,158 (2010) (noting expert's testimony that “[i]t is well known in the pharmacy profession [that] the combination of a benzodiazepine, narcotic pain killer, and Soma [the branded version of carisoprodol] [is] being used by patients abusing prescriptions drugs”);

Paul J. Volkman,

73 FR 30,630, 30,637-38 (2008)(discussing expert's testimony regarding abuse of drug cocktails of oxycodone, alprazolam, and carisoprodol).

On direct examination, the DI did not identify the specific doctor she was referring to. However, on cross-examination, the DI identified by name a Longwood, Florida physician who “writes the same prescriptions, the same combinations of drugs, to all of his patients.” Tr. 274. This is the same physician whose prescriptions are listed in the eighty-one page spreadsheet which is GX 55.

The DI further noted that while this physician “may vary the quantity” of oxycodone from patient to patient, “the majority of the prescriptions are for the combination of oxycodone, alprazolam, and carisoprodol or Soma.”

Id.

The record also contains a number of oxycodone prescriptions which were written by this physician, most of which contain the same DX Code.

See

GX 67 (of nine prescriptions issued by physician on April 26, 2011, eight list DX code of 724.2); GX 68 (of eighteen prescriptions issued by physician on May 19, 2011, sixteen list DX Code of 724.2).

Here too, the ALJ found the testimony of the Agency's Investigators regarding the statements made by these employees to be credible.

See

ALJ at 24, 66-68. And while the statements are hearsay, they are inherently reliable as statements against interest.

Cf.

Fed. R. Evid. R. 804(b)(3).

The statements of Respondents' employees thus manifest a complete abdication of their responsibility “to exercise professional judgment” before dispensing prescriptions for highly abused controlled substances.

Ralph J. Bertolino, d/b/a/Ralph J. Bertolino Pharmacy,

55 FR 4,729, 4,730 (1990). This evidence provides further support for the conclusions that each Respondent dispensed numerous prescriptions when their pharmacists either knew or had reason to know that the prescriptions lacked a legitimate medical purpose and were issued outside of the usual course of professional practice and thus violated the CSA.

See

21 CFR 1306.04(a).

Respondents nonetheless contend that the ALJ improperly shifted the burden of proof from the Government to them. Resp. Exceptions, 15-18. More specifically, Respondents note that in a pre-hearing order, the ALJ held that to prove a violation of 21 CFR 1306.04(a), the Government was required to prove the following elements: (1) That “the Respondent dispensed a controlled substance”; (2) that “a red flag was or should have been recognized at or before the time the controlled substances was dispensed”; and (3) that “the red flag was not resolved conclusively prior to the dispensing of the controlled substance.” ALJ Ex. 28, at 11-12;

see also,

Gov't Ex. 32 at 3-12. Although Dr. Lynch's COR was revoked, DI Langston explained that the DEA Web site would reflect that his registration was “expired.” Tr. 74-75.

On cross-examination DI Langston testified that, unlike the case of a revocation, in situations where a COR expires by its own terms, there is a thirty-day window between the expiration date and the date the number associated with the COR is retired. Tr. 78-79. This grace period is designed to address inadvertent lapses or other unintentional delays. If a registrant submits an application for renewal after the expiration date, but during the grace period, then the registrant will maintain his or her dispensing privileges. Tr. 78-79. A pharmacist who encounters an “expired” signal may resolve the red flag by calling the DEA and inquiring about the status of the application or registration. Tr. 102-03.

The testimony presented by DI Langston was sufficiently detailed, consistent, and plausible to be fully credited in this recommended decision.

The Government also presented the testimony of DI Stephanie Orr. DI Orr testified that she has been employed by the DEA since July of 2009, and that she currently is stationed in the DEA's Boston Office. Tr. 335-36.

DI Orr testified that she participated in the execution of an administrative inspection warrant on Respondent 219 on October 18, 2011, and that her role in that evolution was “to gather the records of inventories and prescription records and dispensing records.” Tr. 337-38. Upon entering the store, DI Orr enlisted the assistance of CVS lead technician Keyla Perry in gathering records at the pharmacy Tr. 337-40. Through Ms. Perry, DI Orr collected an inventory taken in September of 2011, and another taken in October of 2010.

Tr. 339. Orr also requested and received hard copy “prescriptions for the controlled substances for Schedule 2s * * * for that time period.” Tr. 339-40. The prescription records, which were produced in small boxes, were photocopied by the DEA, and then returned Respondent 219. Tr. 340-41. DI Orr also obtained the dispensing binders

for oxycodone 30 mg for the relevant time period. Tr. 341-42. As with the hard copies of the prescriptions, the dispensing labels were taken into DEA evidence, scanned, and returned. Tr. 342.

DI Orr explained that she “gathered two sets of inventories because [she] wanted to make sure that it went over at least a year.” Tr. 339.

DI Orr explained that “when a prescription is printed out [Respondent 219] put a sticker on the back of the prescription and then that [sticker] has like a label and they put that in a binder.” Tr. 341.

While Ms. Perry assisted with the collection of records, she and DI Orr discussed Perry's employment at CVS. Tr. 343. Orr described Perry's demeanor during this conversation as “normal” and “relaxed.” Tr. 343. Ms. Perry stated that she had worked for CVS for seven years, and Respondent 219 for the past three years. Tr. 343. Ms. Perry also told DI Orr that Respondent 219 filled approximately a thousand prescriptions per day, the majority of which were for controlled substances. Tr. 344.

As to the filling of oxycodone 30 mg prescriptions, Ms. Perry indicated that Drs. Pyko, Namone, Moyer, Pizza, Scolaro, Namone, Moyer and Zelkowitz “were some of the top prescribing doctors” for oxycodone 30 mg at Respondent 219. Tr. 344. Ms. Perry also set forth Respondent 219's procedure for verifying Schedule II controlled substances presented to the pharmacy. Tr. 345. Specifically, Ms. Perry “stated that when a prescription was presented she'll get an ID from the patient, write down their driver's license number on the prescription, and then call the doctor to verify and write down who they spoke to, the date, along with * * * the diagnosis code.” Tr. 345.

After the AIW inspection, DI Orr received a CD that contained a Microsoft Excel spreadsheet (CVS Dispensing Data)

that was provided by CVS and contained the dispensing records for the Respondent pharmacies from January 1, 2010, up until October 16, 2010.

Tr. 347. DI Orr also received “one scrip that was labeled 10/17/11.” Tr. 348. Orr narrated her understanding of the information provided in the spreadsheet provided by CVS. In addition to the drug type and strength, the CVS Dispensing Data set forth culled information regarding individual controlled substance dispensing events. The document included the method of payment (listed under “agency type”), the National Drug Code and schedule classification for each drug, the pharmacy number (219 or 5195), the prescription number assigned by the Respondents to specific dispesnsings, the dispensing date and quantity, as well as the name and address of each patient and prescriber. Tr. 353-56; Gov't Ex. 30. DI Orr invested considerable testimony into detailed explanations of her efforts to process the data provided by CVS into multiple spreadsheets to facilitate an analysis of the Respondents' dispensing.

The spreadsheet from CVS was admitted into evidence as Government Exhibit 30.

Though the data on the spreadsheet came from CVS, DI Orr testified that it was her understanding that the data was sent via email to another DI who burned the data onto a CD. Tr. 348. Although the DEA had only requested the dispensing records for only oxycodone 30 mg, the spreadsheet provided by CVS also contained other controlled substances, such as Oxycontin 80 mg and Oxycontin 20 mg. Tr. 350.

Sometime after receiving the CVS Dispensing Data, DI Orr “was sent an email from [Group Supervisor] Carter [containing] about 22 different spreadsheets for different doctors that [were] provided to her from CVS.” Tr. 365. These individual spreadsheets showed the controlled substances dispensed pursuant to prescriptions of certain practitioners.

Id.

DI Orr was asked “to analyze [all the spreadsheets], look through [them], and create several spreadsheets for different physicians and addresses, and then sort it by drugs.” Tr. 350. In this regard, Orr explained that she utilized specialized training she had received at DEA regarding the handling and preparing of spreadsheets. Tr. 535.

Though the spreadsheets purport to reflect the dispensing records of the Respondents, DI Orr conceded that the “actual”

dispensing records are the hard copies of the prescriptions, and that the overall reliability of the spreadsheets provided was dependent on the reliability of the pharmacy technicians entering the dispensing data. Tr. 542-43. To ensure the accuracy of the data provided, DI Orr compared the hard copies of “more than one-hundred” prescriptions to the corresponding data reflected in the CVS Dispensing Data. Tr. 537-38. Of the hard copy prescriptions she checked against the CVS Dispensing Data, DI Orr identified “several” errors. Tr. 544. When queried why she would check only one-hundred prescriptions in a document with approximately 25,000 records of dispensing, DI Orr testified that she did not have time to perform a more thorough analysis. Tr. 555.

DI Orr explained that “they typically have three kind[s of dispensing records], the hard copies, the electronic copy, and then also the binder that has the other stickers.” Tr. 544. DI Orr “found missing prescriptions,” where a copy or record would not have a corresponding entry in another location. Tr. 544.

A spreadsheet of common addresses (Common Address Spreadsheet) was created by DI Orr by culling address information from the CVS Dispensing Data Tr. 358-60; Gov't Ex. 22. Orr explained that the filtering process utilized to create the Common Address Spreadsheet involved a manual survey of only approximately one-fourth of the CVS Dispensing Data. Tr. 360-61. From this manual view, DI Orr identified dispensing events for “multiple people living at the [same] address, the same household * * *.” Tr. 362. The dispensing events for common addresses were then populated into the Common Address Spreadsheet, which was received into evidence. Gov't Ex. 22.

DI Orr also created a spreadsheet from the CVS Dispensing Data wherein she culled out oxycodone 30 mg dispensing events grouped by thirteen individual Florida prescribers. Tr. 367-68. From the prescriber-culled data, DI Orr created “pivot tables”

for each practitioner, showing the sum of oxycodone 30 mg prescribing, and in some cases the sum of Roxicodone 30 mg prescribing.

See

Tr. 368. The combined by-prescriber data and pivot tables (By-Prescriber Chart A) were received into evidence. Gov't Ex. 57.

A pivot table is “a tool through Excel that “breaks * * * up [data] more specifically.” Tr. 368.

The By-Prescriber Spreadsheet was, in turn, used by DI Orr to create a pivot table setting forth the total oxycodone 30 mg dispensed by the Respondent pharmacies pursuant to prescriptions written by the thirteen South Florida doctors organized by patients residing in specific cities and states (Prescriber & Patient Address Chart). Tr. 381; Gov't Ex. 58. When creating the categories for the locations, DI Orr aggregated addresses she believed to be the same, explaining that “[a]n example might be Altamonte Springs and they might put ALT Springs but you know it was Altamonte Springs.” Tr. 383. As with the By-Prescriber Spreadsheet,

the source of the data used in Prescriber & Patient Address Chart was the individual prescriber spreadsheets provided to the DEA by CVS. Tr. 384.

Gov't Ex. 57.

Orr also created a document which combined spreadsheets and pivot tables to demonstrate the dispensing of oxycodone 30 mgs by Respondent pharmacies pursuant to prescriptions written by four specific South Florida practitioners (By-Prescriber Chart B). Tr. 439-40; Gov't Ex. 59. To create By-Prescriber Chart B, DI Orr extracted from the CVS Dispensing Data, dispensing events for oxycodone 30 mg, Roxycodone 30 mg, and Oxycontin 30 dispensed pursuant to prescriptions written by the four South Florida doctors. Tr. 440, 445. The extracted data was then separated into four spreadsheets, with each spreadsheet representing the oxycodone 30 mg, Roxycodone 30 mg, and Oxycontin 30 mg dispensing for a particular doctor. Tr. 440-41. DI Orr then created pivot tables for each spreadsheet representing the total amount of oxycodone 30 mg dispensed, and the total amount of oxycodone 30 mg dispensed to specific United States cities. Tr. 439-444.

In response to a request from DEA, CVS generated and provided to the DEA a spreadsheet that culled out controlled substance dispensing events by the Respondent pharmacies pursuant to prescriptions written by Dr. Ronald Lynch.

Gov't Ex. 32. Orr removed the header from the CVS spreadsheet, but otherwise did nothing to change the document, which was received into evidence (Lynch Dispensing Chart). Tr. 454; Gov't Ex. 32.

The information was provided to another DI and forwarded to Orr. Tr. 453.

Orr generated two pivot tables from the Lynch Dispensing Chart: one table showing the total amount of specific controlled substances dispensed by the Respondent pharmacies pursuant to prescriptions written by Dr. Lynch (Lynch By-Medication Table) and the other table showing the total amount of controlled substances prescribed by Dr. Lynch and dispensed by Respondent pharmacies to patients, organized by the address cities of the patients (Lynch By-Patient City Table). Tr. 457-58; Gov't Ex. 33 at 1-3.

DI Orr explained that she was aware that Dr. Lynch's DEA registration was revoked on January 18, 2011,

and that she searched the Lynch Dispensing Chart

for controlled substance dispensing events occurring after the January 18, 2011, revocation date. Tr. 460-61. DI Orr found three instances where Schedule II controlled substances were dispensed for a patient named T.N. after January 18, 2011, and obtained the corresponding hard copies and dispensing labels. Tr. 461-62; Gov't Ex 33 at 4-9; Gov't Ex. 32 at 9. The three prescriptions were written for T.N. for sixty tablets of 10/650 mg Percocet. For all three prescriptions, the prescribing physician is listed as Ronald Lynch, M.D., of Lake Mary, Florida. Gov't Ex. 33, at 4, 6, 8. The earliest of these bares the issuance date of February 2, 2011. Gov't Ex. 33, at 4. The corresponding dispensing label for that prescription reflects that on February 2, 2011, at 7:04 p.m., sixty tablets of 10-650 mg Endocet were dispensed for patient T.N.

Id.

at 5. Another prescription written by Dr. Lynch for T.N. is dated February 25, 2011. Gov't Ex. 33, at 6. The corresponding dispensing label indicates that on February 25, 2011, at 2:02 p.m., sixty tablets of oxycodone-Acetaminophen 10-650 were dispensed.

Id.

at 7. A third prescription is dated March 24, 2011.

Id.

at 8. The

corresponding dispensing label for this prescription reflects that on March 24, 2011, at 12:42 p.m., sixty tablets of oxycodone-Acetaminophen 10-650 were dispensed.

Id.

at 9. All three controlled substance dispensing events occurred after Dr. Lynch's January 18, 2011, revocation date, when Lynch had no authority to prescribe controlled substances. All three dispensing events occurred at Respondent 219. Gov't Ex. 32 at 9. Further, the Lynch Dispensing Chart reflects that Respondent 219 dispensed controlled substances pursuant to prescriptions written by Dr. Lynch no fewer than twenty-seven (27) times after Dr. Lynch's COR was revoked. Gov't Ex. 32. Of these twenty-seven prescriptions, seven were dispensed later than June of 2011. Gov't Ex. 32, at 5, 7. Similarly, Respondent 5195 filled four prescriptions after the January 18, 2011, revocation, one of which fell in June. Gov't Ex. 32, at 12. Thus, the Respondent pharmacies were dispensing controlled substances on Dr. Lynch's prescriptions approximately six months after he had lost his authority to prescribe them.

As set forth above, the record evidence establishes that on December 3, 2010, DEA issued a revocation order, effective January 18, 2011. Gov't Ex. 31 at 3-12;

Ronald Lynch M.D.,

75 FR 78745 (2010). In the order revoking the COR, the Agency found that Dr. Lynch had engaged in the unauthorized practice of medicine and had issued prescriptions which “lacked a legitimate medical purpose.”

Lynch,

75 FR at 78753.

DI Orr limited her search to Schedule II controlled substances because she “had only requested Schedule II hard copy prescriptions * * * so anything else I wasn't able to verify hard copies.” Tr. 462.

DI Orr also queried the CVS Dispensing Data for prescriptions for controlled substances dispensed pursuant to prescriptions written by Dr. Anthony Wicks, a physician with offices located in Winter Springs, Florida. These prescriptions were targeted because Orr was aware that Dr. Wicks' DEA COR expired on May 11, 2011. Tr. 468. DI Orr created a chart setting forth oxycodone 30 mg dispensing events from Respondent 219 (Wicks 219 Dispensing Chart) and Respondent 5195 (Wicks 5195 Dispensing Chart), as well as a chart reflecting combined dispensing events from both pharmacies regarding those prescriptions from Dr. Wicks. (Wicks Combined Dispensing Chart). Tr. 464-70; Gov't Exs. 10, 27 at 1-8, 28 at 1-7. DI Orr also compared the Wicks dispensing events reflected in the two charts with hard-copy prescription scrips of the medications dispensed at those pharmacies. Gov't Exs. 27 at 9-58, 28 at 8-37. An analysis of the data revealed thirty-eight (38) dispensing events where Respondent 219 dispensed controlled substances for Wicks prescriptions after his DEA COR expired on May 31, 2011. Tr. 468. Respondent 5195 dispensed controlled substances seventeen (17) times pursuant to Wicks' prescriptions after Wicks' COR expired. Tr. 469. Thus, the two Respondent pharmacies filled a total of fifty-five (55) oxycodone prescriptions written by Dr. Wicks after his COR was expired and he was without authority to write controlled substance prescriptions. Respondent 5195 filled Dr. Wicks' oxycodone prescriptions as late as July 14, 2011, and Respondent 219 dispensed Wicks' oxycodone prescriptions as late as July 15, 2011. Gov't Ex. 10 at 6.

The record also establishes that even prior to the expiration of his COR, Dr. Wicks had a COR-registered address, not in Florida, but in California. Gov't Ex. 26; Tr. 580. Notwithstanding that reality, and the legal requirement to have a COR-registered address in the state where a prescriber is prescribing,

from December 17, 2010, through May 31, 2011, Respondent 219 dispensed 117 controlled substance prescriptions on prescriptions issued by Wicks. Gov't Ex. 27. Respondent 5195 dispensed 125 controlled substance prescriptions on Wicks' California-address COR during the same period. Gov't Ex. 28.

21 CFR 1301.12.

At DEA's request, CVS supplied dispensing data on an Orlando, Florida prescribing physician, named Dr. Riyaz Jummani (Jumamani Dispensing Chart).

Gov't Ex. 35; Tr. 472-74. Using the data in the Jummani Dispensing Chart, DI Orr created two pivot tables: a table showing the total amount of specific types of drugs dispensed by the Respondent Pharmacies pursuant to prescriptions written by Dr. Jummanni (Jummani By-Medication Table);

and a table organizing Dr. Jummani dispensing events at the Respondent pharmacies by patient address city/state (Jummani By-Patient Location Table). Gov't Ex. 36 at 2-4.

This data was provided to another DI and forwarded to Orr. Tr. 473.

Gov't Ex. 36 at 1.

On cross-examination DI Orr admitted that two pages that the Government had initially included as part of Government Exhibit 36 actually depicted prescription scrips from a different prescriber which were not problematic. Tr. 476. The Government withdrew these two pages and the Respondents offered it to show a lack of Government infallibility, and handwritten markings on the scrip to establish that their pharmacists were conducting some measure of due diligence in an effort to resolve potential red flags. Tr. 549; Resp't Ex. 94.

At DEA's request, CVS supplied dispensing data from the Respondent pharmacies on a Palm Coast, Florida, prescriber named Dr. Ralph Chambers (Chambers Dispensing Chart).

Gov't Ex. 44; Tr. 478-79. Using the data from the Chambers Dispensing Chart, DI Orr created two pivot tables. The first table shows “the [types of] drugs that [Dr. Chambers] prescribed that were dispensed at CVS 5195 and 219” (Chambers By-Medication Table). Gov't Ex. 45 at 1. The second table shows “Dr. Chambers' dispensing records per city and state and quantity” (Chambers By-Patient Location Table). Gov't Ex. 45 at 2-3; Tr. 481.

This data was provided to another DI and forwarded to Orr. Tr. 478-79.

At DEA's request, CVS supplied dispensing data from the Respondent pharmacies on a Winter Park, Florida, prescriber named Dr. Michael Moyer (Moyer Dispensing Chart). Gov't Ex. 48. The spreadsheet was sent by CVS to Investigator Carter, who then forwarded it to DI Orr. Tr. 482-84. Using data from the Moyer Dispensing Chart, DI Orr created a pivot table showing total amount of specific types of drugs dispensed by the Respondent pharmacies pursuant to prescriptions written by Dr. Moyer (Moyer By-Medication Table).

Gov't Ex. 49; Tr. 482.

This data was provided to another DI and forwarded to Orr. Tr. 482-83.

At DEA's request, CVS supplied dispensing data from the Respondent pharmacies on a Longwood, Florida, prescriber named Dr. James Pizza (Pizza Dispensing Chart).

Gov't Ex. 55; Tr. 485-88. From the Pizza Dispensing Chart, DI Orr generated a pivot table and pie chart setting forth aggregate numbers of three oxycodone medications (oxycodone HCL 15 MG, oxycodone HCL 40 mg, Roxicodone 15 mg or Roxicodone 30 mg) reflected in dispensing events from the Respondent pharmacies from July 19, 2010, through October 17, 2011 (Pizza Pie Chart and Table). Gov't Ex. 56 at 1. Orr also used the Pizza Dispensing Chart to generate a table organizing Dr. Pizza dispensing events at the Respondent pharmacies by patient address city/state (Pizza By-Patient Location Table). Gov't Ex. 56 at 2-4; Tr. 487-89.

This data was provided to another DI and forwarded to Orr. Tr. 485.

The dispensing records contained in the CVS Dispensing Data only went through October 16, 2011. Tr. 502. At some point after the October 18, 2011, AIW, CVS provided the dispensing data for October 17, 2011, to a DI who forwarded the data to DI Orr. Tr. 502-03.

The testimony presented by DI Orr was sufficiently detailed, consistent, and plausible to be fully credited in this recommended decision.

The Government also presented the testimony of GS Kyle Wright. Tr. 309. GS Wright testified that he began his employment with the DEA in 1995, and served as a DI, and held various supervisory positions in the agency prior to his current assignment as the Unit Chief of DEA's Targeting and Analysis section, also known as ARCOS. Tr. 309-11.

GS Wright explained that distributors and manufacturers of Schedule I through III controlled substances are required by law to report “[a]ny transaction involving those controlled substances.” Tr. 311. The ARCOS section compiles the reports of the distributors and manufacturers and uses this data to fulfill internal requests from the DEA and internal requests from organizations like the United Nations, newspapers, and State attorney general offices. Tr. 312.

In his capacity as Unit Chief of ARCOS, Mr. Wright was asked to provide an overhead map of the Respondents' pharmacy locations and “other pharmacies within the immediate area.” Tr. 313. Mr. Wright testified that Government Exhibit 19, which shows the location of the Respondent Pharmacies, as well as other pharmacies in the area, was created using Google Maps. Tr. 313. Also using Google maps, Mr. Wright's unit produced a “clean” map of Central Florida. Tr. 316-17. The clean map was admitted as Government Exhibit 63.

Mr. Wright testified to the creation of Government Exhibit 62. Tr. 317-18. Government Exhibit 62 is a map which marks the city of Sanford, and “the other townships or cities located in southern Florida, in which prescribing doctors resided or operated their offices at,

but whose prescriptions were being filled in Sanford.” Tr. 318. The map shows the “relative distance” between the cities of the prescribing physicians and the city of Sanford, where the Respondent pharmacies are located. Tr. 317-18. Government Exhibit 62 does not differentiate between the number of prescriptions filled, the dates prescriptions were filled, or whether the prescriptions

were filled at Respondent 219 or Respondent 5195. Tr. 329.

The locations of the prescribing physicians were provided to Mr. Wright by another component of DEA. Tr. 319.

ARCOS personnel also used Google Maps to create a map of central Florida, showing the CVS pharmacies located “within the Orlando and Daytona Beach, Florida area.” Tr. 321. The map of the other CVS pharmacies, which was admitted as Government Exhibit 17, contains a key which matches the marks on the map to specific CVS pharmacies. Tr. 321. ARCOS personnel obtained the locations of the CVS pharmacies marked in Government Exhibit 17 from the DEA's CSA database, which is a database of information provided to the DEA by DEA registrants. Tr. 322. Specifically, ARCOS personnel queried the CSA database for all pharmacies in Florida, and then selected pharmacies named “CVS” with specific zip codes. Tr. 322-24. The key associated with Government Exhibit 17 was downloaded directly from the CSA database. Tr. 324.

Government Exhibit 64 was created by the ARCOS section to show the locations of the Respondent Pharmacies “relative” to the locations of other CVS pharmacies and to the “practitioners * * * identified as having prescriptions filled at one of [the Respondent] pharmacies.” Tr. 325-26. Put differently, Government Exhibit 64 shows three classes of information: (1) the location of the Respondent Pharmacies (marked in green); (2) the location of other CVS pharmacies in the Sanford area (marked in blue); and (3) the location of practitioners whose prescriptions were filled at the Respondent Pharmacies (marked in red).

Id.

As with Government Exhibit 17, the locations of the CVS pharmacies were taken from the CSA database. Tr. 327. The locations of the prescribing practitioners were provided by DEA's Chief Counsel's Office. Tr. 327. As with Government Exhibit 62, Government Exhibit 64 does not differentiate between the number of prescriptions filled, the dates prescriptions were filled, or whether the prescriptions were filled at Respondent 219 or Respondent 5195. Tr. 329-30.

The testimony presented by GS Wright was sufficiently detailed, consistent, and plausible to be fully credited in this recommended decision.

The Government also presented the testimony of Heather Wehrle, a DI with the Nashville District Office. Tr. 163. DI Wehrle has been employed by the DEA for over eight years, and has attended various in-house DEA training evolutions. Tr. 164-65.

DI Wehrle was a part of the group that served the AIW on Respondent 5195 on October 18, 2011. Tr. 165-66. According to Wehrle, she arrived at Respondent 5195 in support of the AIW at approximately 10:30 a.m., and two hours thereafter, conducted an interview with Marcus Badley, a pharmacy technician who was on duty. Tr. 166-68. At some point during the interview, Badley walked “in the direction of the drive-through window” and retrieved a 3

1/2

by 5 inch handwritten piece of paper. Tr. 174-75. The paper had the words “do not fill” written across the top, and the names of four doctors written (in different handwriting) below.

Tr. 174-75. The four names listed on the document were: (1) Dr. Pizza; (2) Dr. Moyer; (3) Dr. Mammone; and (4) Dr. Jummani. Tr. 174. Mr. Badley stated that the names on the list were doctors that the pharmacy “look[ed] out for that have been in trouble.” Tr. 204. DI Wehrle did not learn when the list was created. Tr. 198. Also during the interview Mr. Badley stated that Respondent 5195 only would fill prescriptions in the “Central Florida area.” Tr. 175.

DI Wehrle wrote the names of the doctors on the “dot not fill” list down in her notes; but she did not take the list itself. Tr. 196-97.

DI Wehrle also interviewed five or six customers present at the store at the time of the AIW. Tr. 176. Two of the customers had prescriptions written by Dr. Pizza. Tr. 177-78. One customer had dilated pupils and difficulty concentrating. Tr. 177-78. However, there is no evidence that any of the customers DI Wehrle interviewed had prescriptions filled at Respondent 5195 that day. Tr. 178.

Ten days after the AIW inspection, on October 28, 2011, DI Wehrle interviewed a Respondent 5195 pharmacist named Mark Mascitelli. Tr. 178-80. The interview was conducted at the DEA Office in Orlando, and was attended by DEA GS Ruth Carter, and CVS attorneys John Gilbert, Esq. and Meredith Young, Esq. Tr. 178-79. Pharmacist Mascitelli stated that he had been employed by CVS since of August of 2009, and that he had been employed as a full time employee at Respondent 5195 since May of 2010. Tr. 180.

Pharmacist Mascitelli told DI Wehrle that, although the pharmacy opens at 8:00 a.m., customers “start showing up early.” Tr. 180-81. He also told the DEA investigators that “he could fill oxycodone prescriptions all day long if he had the manpower and the inventory.” Tr. 181. However, Mascitelli stated that “whoever opens in the morning * * * has to set limits on how many oxycodone prescriptions are filled for the day due to inventory. Tr. 182. Pharmacist Mascitelli said that Respondent 5195 would not fill prescriptions for Dr. Pizza, Dr. Mammone, Dr. Chambers or Dr. Scolero because of actions taken against the doctors' licenses. Tr. 183. DI Wehrle did not inquire what steps were taken when a prescription from one of these doctors was presented; or when Mascitelli developed his concerns about the physicians. Tr. 199.

Mr. Mascitelli explained that approximately two weeks prior to the serving of the AIW, CVS supervisor Jennifer Lalani told him and Jessica Merrill—the Pharmacist in Charge (“PIC”) at Respondent 5195—that they “were to identify more filters

to put in place for oxycodone prescriptions.” Tr. 185. In response to this directive, Pharmacist Mascitelli and PIC Merrill, “decided [to] no longer accept new customers of oxycodone prescriptions * * * that they needed to look for signs of abuse or impairment [and that t]hey needed to do more verifications on the customers.” Tr. 186. The pharmacy also decided to limit filling prescriptions for only those patients within the Deland to Orlando, Florida, area. Tr. 201.

DI Wehrle testified that she understood “filters” to mean procedures “[t]o catch bad stuff, bad things going through the pharmacy.” Tr. 186.

That same day, DI Wehrle conducted an interview with Marie Morrell, the lead pharmacy technician at Respondent 5195. Tr. 186-87. Like the interview with Pharmacist Mascitelli, GS Carter, and CVS attorneys John Gilbert Esq. and Meredith Young, Esq. were also present during the discussion. Tr. 187. Ms. Morrell testified it was part of her responsibility to receive prescription scrips from Respondent 5195's pharmacy customers. Tr. 187. All Schedule II controlled substance scrips would be taken directly to the pharmacist. Tr. 187-88. If the pharmacist determined that the medication would be dispensed, “then the customer [was] told * * * that it would be five to six hours before their prescription [was] filled.”

Tr. 188. Based “on inventory and man hours” limits would be placed on the number of oxycodone prescriptions which could be filled for one day.” Tr. 188-89. The limit would be satisfied “on a first-come, first-served basis.” Tr. 189. According to Morrell, the limit was sometimes reached between 10:00 a.m. and noon; but the limit could be reached as early as 8:30 a.m. (i.e., 30 minutes after the pharmacy opens). Tr. 189. In addition to the foregoing duties, Ms. Morrell also engaged in “customer verifications.” Tr. 187-88. In this regard, Morrell related that:

If the prescription was for a Schedule III through Schedule V drug, then Ms. Morrell would prepare the bottles and labels for the prescription to be filled. Tr. 187-88.

“she normally * * * w[ould] call the doctor's office [and] verif[y] the diagnosis code if there is one on the prescription. If there is not one, she w[ould] get one from the doctor and put it on there. If the customer has seen multiple doctors, she may call [the] other doctors' offices * * * She w[ould also] establish from the doctor how long that person has been a patient of the doctor's.”

Tr. 188. As to the behavior of the customers, Morrell told Wehrle that she looked “for any signs of rude behavior, rude language, inconsistencies in stories [and] hat and sunglasses.” Tr. 190.

On November 3, 2011, DI Wehrle interviewed a CVS pharmacist named Randy Dwight. Tr. 190. Mr. Dwight told DI Wehrle that he was a “floater pharmacist” for CVS and that he covered twenty stores in two districts. Tr. 191. He worked at Respondent 5195 once, and worked at Respondent 219 “every other weekend.” Tr. 191-92. Mr. Dwight explained that these two pharmacies did not fill controlled substances on nights or weekends “because they cannot contact the doctor's office.” Tr. 191-92.

The testimony presented by DI Wehrle was sufficiently detailed, consistent, and plausible to be fully credited in this recommended decision.

The Government also presented the testimony of GS Ruth Carter. Tr. 213-14. GS Carter, a 23-year veteran of DEA, currently serves as the Group Supervisor for DEA's Seattle Field Division. Tr. 214.

Carter testified that she became involved with the investigation into the Respondent Pharmacies in October of 2011, when she was assigned as the case agent in a case involving Cardinal Health, a distributor of controlled substances to CVS. Tr. 216. In connection with the Cardinal Health investigation, GS Carter reviewed the

controlled substance ordering data for CVS stores supplied by Cardinal. Tr. 217. Carter testified that, while reviewing the data, she became “very concern[ed]” about the quantity of oxycodone ordered by the Respondent Pharmacies. Tr. 217. It was based on Carter's discomfiture that DEA prepared administrative inspection warrants for the Respondent Pharmacies. Tr. 217. The AIWs were executed at both Respondent pharmacies on October 18, 2011, and GS Carter participated on scene at Respondent 5195. Tr. 218.

During the execution of the AIW at Respondent 5195, GS Carter interviewed employees and examined records. Tr. 218. GS Carter testified that she arrived at Respondent 5195 sometime between 10:00 a.m. and 10:30 a.m. Tr. 219. Upon arriving at Respondent 5195, a special agent presented the AIW to PIC Jessica Merrill. Tr. 219. While the AIW was presented to PIC Merill, GS Carter observed two individuals sitting in the waiting area next to the pharmacy counter. Tr. 219. One of the individuals volunteered that he had driven “far” to get his prescription for oxycodone filled, but that he had been told by pharmacy technician Arlene Picccerilli that the store was out of stock. Tr. 220-21.

GS Carter then interviewed Ms. Piccerilli, who said that she had been employed at Respondent 5195 for approximately thirty months. Tr. 222. She also admitted that the pharmacy was not out of oxycodone. Tr. 224-25. When GS Carter inquired why Ms. Piccerrilli had just told a customer that the store was out of oxycodone,

Piccerilli replied that “the pharmacist on duty sets a limit of how many oxycodone prescriptions can be filled each day.” Tr. 223. On October 18, 2011, Ms. Piccerilli had been “told how many prescriptions she could accept to be filled that day for the oxycodone and the other prescriptions. The combination [of] the [a]lprazolam and the Soma, those prescriptions.” Tr. 223-24. Ms. Piccerilli explained to Carter that, on that day, the limit had been reached by the time the customers in the waiting area had presented their prescriptions. Tr. 224.

GS Carter knew that this was untrue because she had observed DEA agents counting oxycodone tablets at the time of the AIW and knew that the store was not out of stock. Tr. 221-22.

GS Carter also asked Ms. Piccerilli to show her the prescriptions that had been accepted for filling for that day. Tr. 226. When Ms. Piccerilli showed GS Carter the prescriptions, GS Carter asked her “What is your opinion as a pharmacy technician of these prescriptions? They're all for the same drugs, pretty much the same amounts.” Tr. 226. Ms. Piccerilli responded that “as a pharmacy, we cannot judge whether a prescription is valid. That's up for the doctor to decide.” Tr. 226. In response to a question about whether the pharmacy filled prescriptions for out-of-state customers, Piccerilli stated that when she had started at Respondent 5195 they had “accepted prescriptions from other states, but that sometime in the last year or so, the policy had changed, and now they only accepted prescriptions for oxycodone for local customers and local doctors.” Tr. 226. Ms. Piccerilli explained that “local” meant “somewhere around Daytona Beach or Deltona Beach to Orlando.” Tr. 226-27. It was GS Carter's recollection that Ms. Piccerilli was cooperative throughout their encounter. Tr. 225.

Approximately an hour after her conversation with Ms. Piccerrili, GS Carter conversed with PIC Merrill behind the shelves of the pharmacy. Tr. 227. During this conversation, DI Wehrle and another DI were “in and out.” Tr. 227-28. It was Carter's impression that Merrill was cooperative throughout the conversation. Tr. 228. In her conversation with GS Carter, PIC Merrill made the following representations:

(1) She was hired by CVS in 2009, and a few months later she was promoted to the Respondent 5195 PIC position. Tr. 228.

(2) She could fill “these oxycodone prescriptions * * * all day long, but that rather than doing that,” she, or the pharmacist on duty, sets the limit. The daily limit is determined based on “the inventory that they had on hand that morning, and also the amount of staff that they had on hand because * * * it was very time consuming * * * to call the doctors' offices and verify each prescription.” Tr. 229-30. If a prescription could not be verified, it would not be filled. Tr. 279.

(3) When the limit fixed by the PIC was reached, subsequent customers were told that the pharmacy is out of stock.

(4) The customers were aware that the limit system is first-come-first-served, so customers would start to “stagger” in at 8:02 a.m. Tr. 230-231.

(5) If a prescription for oxycodone, alprazolam and a muscle relaxant was accepted for filling, the customer would be told to return in five hours. Tr. 230, 232.

(6) When setting the daily limit of oxycodone prescriptions, she would make sure to keep some oxycodone on hand to fill prescriptions for her “real pain patients.” Tr. 231, 232. She would dispense the prescriptions to customers she classified as other than “real pain patients” because “if she or her staff was able to confirm that a prescription had been issued by a physician who was licensed by the state, and had a DEA license, then as a pharmacy, they should be able to trust that prescription * * * is legitimate.” Tr. 234.

(7) Before filling prescriptions for oxycodone, the employees at Respondent 5195 would conduct “very stringent due diligence.” The steps taken to verify a prescription were: (i) obtain a Florida ID or a Florida driver's license and record the number on the front of the prescription; (ii) call the prescribing physician to confirm the physician had written the prescription, whether any additional prescriptions had been issued and whether a urinalysis test had been performed; (iii) “sometimes” call other pharmacies in the area to determine whether the patient was engaging in doctor shopping; (iv) “sometimes” call a prior practitioner, if the patient's profile

showed that a prior practitioner had prescribed “anything” to the patient; and (v) confirm the diagnosis code, if one was absent; (vi) “sometimes” check with the state licensing boards regarding the status of the prescribing physician's license; and (vii) use their computer system to verify the prescriber's DEA registration. Tr. 235-36.

GS Carter explained that “at pharmacies that * * * use[] electronic systems, there usually is a profile [that] will have the patient name and address, and it will show the prior prescriptions that they have had filled at that pharmacy. And in the case of chains, most of them show the prescriptions filled at all the other chains as well.” Tr. 237.

When looking through the prescriptions which the store had accepted for filling, GS Carter noticed that “generally” the prescriptions accepted for filling would be an oxycodone 30 mg prescription for 180 tablets, paired with a prescription for alprazolam and a prescription for Ibuprofen or carisoprodol.

Tr. 237-38. GS Carter also observed that for a particular physician, the prescriptions “appeared to be all for the same quantity and the same combination of drugs.” Tr. 239. In this regard, PIC Merrill admitted to GS Carter that she saw the patterns of prescribing in the three drugs, that she noticed that “a lot” of the customers with the cocktail were paying for their prescriptions with cash

and that “most of them” were unemployed. Tr. 238. GS Carter testified that when she suggested to Merrill that the customers may be selling their pills, Merrill simply replied “I know.” Tr. 238.

“The generic name of a medicinal substance used as a muscle relaxant.” 1-C Attorneys' Dictionary of Medicine C-20783.

GS Carter testified that, while cash would be paid at the time of pickup, and thus after a determination of validity had been made, she felt that CVS's computer system would have notified the pharmacist that previous prescriptions had been paid for with cash. Tr. 303-04.

GS Carter also observed that “some” of the prescriptions which had been accepted for filling were for customers with IDs from other states but with prescriptions doctors with offices in Florida, far away from Sanford. Tr. 240. Carter recalled that this struck her as odd because “my experience has been that normally a patient will either fill a prescription by the doctor's office or by their residence. They don't usually stop somewhere in between.” Tr. 240. PIC Merrill had no explanation for the distances traveled by the patients to fill their prescriptions. Tr. 240.

Carter testified that following her interactions with PIC Merrill and the other members of the Respondent 5195 pharmacy team, she concluded that

the general attitude was that [the Respondent 5195 pharmacy staff are] not going to question whether the prescription is valid. If the doctor says it's valid, and they do the other verifications, then they fill it. It doesn't matter if they all come in from the same doctor, the same way, or if they suspect that the prescription is not valid. They are going to fill it because the doctor said it was valid.

Tr. 299-300.

As GS Carter was preparing to leave the store, PIC Merrill asked her whether she should fill the prescriptions which had already been accepted that day. Tr. 242-43. When GS Carter asked Merrill whether she felt that the scrips should be filled, Merrill

responded that she felt she should fill them because they had been filled before. Tr. 242-43. When GS Carter pressed PIC Merrill on this issue, Ms. Lalani, who was also present, stated that none of the prescriptions would be filled. Tr. 243.

On October 28, 2011, GS Carter interviewed Paras Priyadarshi—the PIC at Respondent 219—at the DEA facility in Westland, Florida. Tr. 244-45. Also present were GS Carter, DI Wehrle, John Gilbert, Esq., and Meredith Young, Esq. Tr. 244-45. It was Carter's impression that PIC Priyadarshi appeared cooperative during the interview. Tr. 245. During their conversation, PIC Priyadarshi made the following statements:

(1) He had been employed by CVS for approximately thirteen years, and had been the PIC at Respondent 219 for approximately five years. Tr. 246.

(2) For oxycodone, alprazolam, carisoprodol prescriptions,

Respondent 219 would take the following verification steps: (i) examine the prescriptions for alterations; (ii) if there was no diagnosis code on a prescription, then the store would call the physician to verify the prescription. Tr. 246.

DEA inquired about these three drugs “[b]ecause in looking at the prescribing records that we had obtained from CVS, we * * * observe[d] that the CVS 219 was basically filling prescriptions for the same type of cocktail prescribing pattern that CVS 5195 had been dispensing.” Tr. 247.

(3) If a prescription was presented with a diagnosis code by a patient who had filled at Respondent 219 before, then the store would not call the physician. Tr. 246. Similarly, if a person came in with a patient who had filled at Respondent 219 before, he would not feel the need to verify the prescription. Tr. 251.

(4) Sometime in the previous year, CVS corporate had put out guidelines that the stores should only fill prescriptions for “local” doctors and customers, and that the stores should obtain ID for all controlled substance prescriptions. Tr. 246-47. In response to this directive, Respondent 219 had stopped filling out-of-state prescriptions sometimes toward the end of 2010. Tr. 270.

(5) He found nothing odd about the fact that Respondent 219 was filling a like combination of three controlled substances (oxycodone, alprazolam, and carisoprodol), for a high number of prescribing physicians. Tr. 247-48.

(6) For Schedule II controlled substances Respondent 219 dispensed more oxycodone than any other controlled substance. For Schedule III controlled substances Respondent 219 dispensed more hydrocodone than any other substance. For Schedule IVs, Respondent 219 dispensed more alprazolam than any other controlled substance. And for non-controlled substances, Respondent 219 dispensed more Soma or carisoprodol than any other substance. Tr. 248-49.

(7) The oxycodone prescriptions would only be filled by Respondent 219 during the day shift on weekdays. Tr. 249. This was so the store could verify the prescriptions. Tr. 277.

(8) He found nothing odd about a high number of like-ailment diagnosis codes

emanating from individual prescribers. Tr. 249-50.

DEA had observed “that a lot of the prescriptions [had] the same diagnosis code.” GS Carter specifically mentioned the “L4, L5” code. Tr. 250.

(9) Customers would ask for “the Ms” or “the blues,” which were slang terms for the Mallinckrodt brand of oxycodone 30 mg tablets; but that he would not find such requests suspicious. Tr. 250, 256, 264.

(10) If a customer asked for a particular brand name, he would fill the prescription with that brand name if the pharmacy had the brand in stock. Tr. 263-64.

(11) Respondent 219 would see “a lot” of oxycodone prescriptions from Drs. Zelkowitz, Mammone, Salinas, Hannah and Pizza. Tr. 251.

(12) He would not fill prescriptions written by Dr. Pyko or Dr. Chambers because “they had prior action taken against them.” Tr. 252, 933.

That same day (October 28, 2011), GS Carter also conducted an interview with Respondent 219 Pharmacist Susan Masso. Tr. 253. As with the interview with Mr. Priyadarshi, the interview with Ms. Masso was conducted at the Westland field office, with DI Wehrle, attorneys Gilbert, and Young also present. Tr. 253. During the interview Ms. Masso made the following representations:

(1) She had been employed by Respondent 219 since June of 2011, and that for the year before that she had worked as a floater pharmacist for CVS stores in Florida. Tr. 253. Before moving to Florida she had worked as a pharmacist in New York. Tr. 253-54.

(2) Respondent 219 would verify oxycodone prescriptions by calling the physician's office and verifying the diagnosis codes. Tr. 254.

(3) She did not know why a customer who lived in one location, would travel to a second location to see a physician, and then a third location to fill the prescription. Tr. 254.

(4) Customers would request “blues.” Tr. 254.

(5) She understood that oxycodone 30 mg was for pain, oxycodone 15 mg was for “breakthrough” pain, alprazolam was for anxiety, and Soma was for muscle aches. Tr. 255.

(6) She would see oxycodone prescriptions from Dr. Pizza and Dr. Mammone. Tr. 257.

The testimony presented by GS Carter was sufficiently detailed, consistent, and plausible to be fully credited in this recommended decision.

The Government also presented the testimony of DI Gayle Lane. Tr. 108-09. GS Lane testified that she has been with DEA for thirty-five years, and currently serves as a Group Supervisor at the Miami-Weston field division. Tr. 108-09.

GS Lane testified about two meetings she attended with CVS officials. She testified that she was present at the December 2010 CVS Meeting with DI Langston and CVS representative. Tr. 110. Lane also recalled that investigators from the Florida Department of Health were also present, and that “there was a discussion about the oxycodone situation in south Florida, especially in light of the new Florida state law that doctors were limited in their dispensing.” Tr. 110-11.

The substance of this meeting has been set forth at length above.

On August 12, 2011, GS Lane organized a second meeting between DEA and CVS officials (August 2011 CVS Meeting). Tr. 111-12. GS Lane explained that in 2005 the Weston DEA Office “decided to interview all new pharmacy applicants and also treat all new pharmacy applications the same, and alert the chains. So when there was a new pharmacy opening up, I would contact them and they would come in for a discussion of the situation.” Tr. 111. The August 2011 CVS Meeting was conducted in response to a CVS application for a new pharmacy in Hollywood, Florida. Tr. 133. The meeting was attended by DI Lenny Levin and twenty-four CVS pharmacy supervisors, including Jennifer Lalani.

Tr. 112-13. The purpose of the meeting was to share indicators of diversion (i.e., red flags) “to help [the stores] make decisions about whether a prescription was legitimate or not, and [to address] the continued high purchases of [the Respondent Pharmacies].” Tr. 139.

Ms. Lalani attended the meeting even though she was not required to because the Hollywood pharmacy was not within her area of supervision. Tr. 149-50.

Prior to the meeting, GS Lane created an outline of discussion points.

Tr. 113. During the meeting, she told the CVS representatives that “in the environment that we're in it's not enough to call the doctor to verify and also to get a picture ID.” Tr. 113. GS Lane also “cautioned * * * to be leery of Florida ID cards because they are fairly easy to get.” Tr. 113. As to the red flags

of diversion, GS Lane mentioned: (1) “doctors * * * writing * * * the same cocktail of drugs which was oxycodone 30 milligrams, oxycodone 15 [mg], generic Xanax 2 [mg], Soma, and * * * lately * * * a noncontrolled substance like flexural,” Tr. 114, 116.; (2) doctors without a specialty in pain management writing “large quantities” of prescriptions, Tr. 115; (3) doctors giving the same diagnosis code, “usually L-4, L-5 lower back pain,” Tr. 115; (4) patients between the ages of 25 and 40 with cash, Tr. 117; and (5) evidence of doctor shopping,

Tr. 118. GS Lane also identified “sponsor” arrangements in which “people from * * * mostly * * * the mountain states * * * come down in buses and vans * * * and drive to the pharmacy” to fill oxycodone prescriptions. Tr. 117-18. Under this arrangement, the driver of the van would be

the “sponsor.” Tr. 118. The sponsor would normally be paid in drugs.

Tr. 118.

GS Lane did not provide a copy of the talking points to the CVS Representatives. Tr. 160.

GS Lane's outline referred to “suspicious activity.” However, she testified that she would have used the term “red flag” during the meeting. Tr. 137.

GS Lane explained “doctor shopping” as customers “spend[ing] their entire day trying to find doctors to write [oxycodone] prescriptions.” Tr. 118. The customers will collect multiple prescriptions at once, and then fill the prescriptions at various pharmacies. Tr. 138. During the August 2011CVS Meeting, GS Lane told the CVS representatives that the State of Florida planned to implement a prescription drug monitoring program to combat doctor shopping. Tr. 118.

GS Lane was not aware of any instances where either of the Respondent Pharmacies filled prescriptions for these “sponsor” groups. Tr. 139.

A summary Lane prepared at the request of the DEA Chief Counsel's Office sometime after the October 2011 meeting did not contain references to the red flags that she described in her testimony. Tr. 154-156; Resp'ts Ex. 91. Also during her testimony, GS Lane explained that the red flags discussed at the meeting were “just a snapshot of what [was] going on at that time.” Tr. 161. By Lane's account, it was her intention to provide red flag guidance to CVS “in general terms.” Tr. 161. No written list of red flags was provided to CVS by Lane at the meeting.

Id.

Distance traveled by the customer was also identified by GS Lane as a potential red flag of diversion. Tr. 119. In particular, Lane told the CVS officials that either the doctor or the patient should be “nearby” the pharmacy. Tr. 119. GS Lane suggested that, if a pharmacist has a question regarding the distance traveled by a customer, the pharmacist should “ask why [the patient is] coming to my pharmacy.” Tr. 119. GS Lane also demonstrated how to use the Web sites of the DEA and the Florida Department of Health. Tr. 119. In this regard, she showed the CVS representatives the proper login procedures

for the DEA Web site, as well as the manner in which to check a doctor's DEA registration. Tr. 121. GS Lane testified that if a registration was invalid, the DEA Web site would show the registration to be “expired.” Tr. 122-23. “If it's a valid DEA number, [the Web site] shows the expiration date, the DEA registered location, and the schedules.” Tr. 124. She also informed the CVS representatives that the Web site was available free of charge and provided real time data.

Tr. 120.

To log into the DEA Web site, a registrant needs their registration and tax ID information associated with their DEA registration. Tr. 123.

Though GS Lane recommended that CVS use the DEA Web site, she conceded that it was “not uncommon” for large chains to use third-party systems for checking registrations. Tr. 147.

When demonstrating the Florida Department of Health Web site, GS Lane “explained * * * you can click on [the] link to discipline and get all the details of what happened.” Tr. 122. GS Lane testified that she believed the Department of Health Web site was updated in real time. Tr. 122.

At the end of the August 12, 2011, meeting, GS Lane gave the CVS representatives a list of the top thirty-four CVS pharmacies that ordered oxycodone in 2010. Tr. 125-26. On the list, GS Lane specifically noted that Respondents 219 and 5195 ranked approximately 23rd and 37th, respectively, in the nation for oxycodone ordering in 2010. Tr. 127. GS Lane inquired what steps had been taken in the wake of the December meeting to address the concerns raised in that meeting regarding Respondents 219 and 5195. Tr. 128. However, since the stores were not within Lane's area of jurisdiction, she “just asked some questions at the meeting, and that was it.” Tr. 128. At the close of the October 2011 meeting, Ms. Lalani stated that she had looked into the stores and discovered that “one was [a] 24 hour store, and they were both very busy stores off of the I-4 corridor.” Tr. 130.

The testimony presented by GS Lane was sufficiently detailed, consistent, and plausible to be fully credited in this recommended decision.

The Government's Expert

The Government presented the testimony of Professor Paul L. Doering, a retired professor of Pharmacy

at the University of Florida's College of Pharmacy, who was accepted as an expert in the practice of pharmacy and the filling and dispensing of controlled substances, as it relates to the practice of pharmacy. Tr. 685. Over the course of his thirty-five-year career, Professor Doering has published many scholarly articles, and although his experience has been largely invested in research and academia, he also testified that he is a certified consulting pharmacist,

has served as co-director of the Florida Drug Information and Pharmacy Resource Center, and that he had some limited, part-time experience as a practicing pharmacist while in graduate school at the nascent stages of his career.

Tr. 667, 673, 678, 682. He testified that he has presented expert testimony approximately seventy-five times; having been presented as a witness for the Government on every occasion. Tr. 794.

Professor Doering testified that he is a “distinguished service professor emeritus.” Tr. 662.

Professor Doering testified that he has served as a consultant pharmacist at a penal institution. Tr. 684.

Professor Doering's CV was received into the record without objection. Gov't Ex. 6; Tr. 666.

Professor Doering testified that, when presented with a prescription for a medication, a pharmacist's

[p]rofessional responsibilities include reviewing that prescription to see whether or not the doses are appropriate for that patient, looking at other medications that individual may be taking to see whether there's interactions. If there are problems, phoning the prescriber or other individual to resolve those problems, [] in a nutshell, certifying that that prescription is ready for transfer from the possession of the pharmacist to the ultimate end user [and counseling] the ultimate end user . . . about any information that might be necessary for the safe and effective use of that drug.

Tr. 690. Doering further explained that controlled substances fall within a category of what he terms “high alert drugs,” where there is an enhanced potential for problems stemming from incorrect use. Tr. 691. Special care, in Doering's view, must be exercised by a pharmacist dispensing high alert drugs, and particular scrutiny must by leveled at opioids, benzodiazepines, and barbiturates. Tr. 690-92. Although Professor Doering consistently presented his testimony in terms of how

would exercise

his

professional judgment, he made it clear that in his opinion, he was presenting the standard for pharmacy registrants in Florida, in his words, “[i]t's what they're taught in school.” Tr. 758.

Professor Doering testified that there are there are circumstances surrounding the presentation of a prescription to a pharmacist, i.e., “red flags,” that can create an obligation on the part of a reasonable pharmacist to decline to fill, or to take other action in the exercise of the pharmacist's professional judgment. Tr. 693-97. According to Professor Doering, red flags create in a pharmacist the obligation to assure him or herself that the presented prescription may be filled properly. Tr. 843. In Doering's view, the steps taken to address a red flag necessarily are dependent upon the nature of the concern raised by that flag, and are not amenable to the mechanical application of a fixed checklist. Tr. 697-98. For example, requiring identification from the presenter of the scrip can be utilized to ensure that the presenter of the scrip is who he or she claims to be, and can also facilitate the re-contacting of the person if necessary.

Id.

In a similar fashion, contacting the prescriber who drafted the scrip can be helpful in resolving some red flags, but where the red flag (or flags) suggests that the prescriber is “working collaboratively with patients to divert drugs,” contacting that physician provides no real assurance of the

bona fides

of the prescription. Tr. 699. Professor Doering indicated that a practice has developed among pharmacists to contact the prescriber in an attempt by some in the profession to create a form of contrived, unfounded absolution for inadequate controlled substance dispensing. In Doering's words, “over the years there has been a perceived value to the pharmacist that [`]it's out of my hands because I called and I got some voice on the other end that said yeah, that's a good scrip.['] But it's my firm opinion * * * that's inadequate to verify the authenticity or appropriateness of that prescription.” Tr. 699-701. Professor Doering acknowledged that Section 64B of the Florida Administrative Code contains some applicable standards, but testified that this provision is not an exhaustive compilation, and that “[t]he standards of care . . . are not always determined by law, by statute, by rule. They're determined, in fact, by what pharmacists do under like, or similar circumstances.” Tr. 921.

Doering also testified that in exercising independent dispensing judgment, the pharmacist will consider and compare the address of the patient on the scrip and the address of the prescriber who drafted it. Tr. 702.

The method of payment is also, in Doering's opinion, a potential red flag of diversion. According to Doering, “typically, people who may be diverting or otherwise misusing their drugs will pay cash.” Tr. 703. However, Professor Doering conceded that standing alone, the fact that a controlled substance prescription was purchased in cash would have “very little” impact on the decision by a reasonable pharmacist to dispense or decline to dispense. Tr. 705.

Another red flag proposed by Professor Doering is the observation, by a pharmacist, that a particular prescriber is writing “in a factory-like manner, prescriptions for the same drugs, the same quantities . . . without any kind of variability or change considering the different patients that come into that pharmacy.” Tr. 708.

Over the course of his testimony, Professor Doering was asked about individual and groups of dispensing events presented on spreadsheets

that were derived from dispensing data furnished to the DEA by the Respondents. For example, Professor Doering discussed eight controlled substance dispensing events that took place on August 16, 2010, at Respondent 219. Gov't Ex. 57 at 33; Tr. 710-23. Doering testified that the data reflected numerous shared red flags for the eight events, to include that cash was the method of payment, like varieties and strengths of medications were dispensed for all but one patient, all medications were dispensed to patients where an out-of-Florida address was provided, and the common prescriber for all eight patients had a listed practice address in Fort Lauderdale, Florida. Tr. 722-23. In Professor Doering's expert opinion, the combination of these red flags in these prescriptions would not be resolvable to a point where a reasonable pharmacist, exercising his or her corresponding responsibility, could dispense the prescribed controlled substances.

Id.

In explaining his conclusion, Doering reiterated his misgivings regarding the efficacy of a pharmacist limiting the inquiry to checking patient identification and telephonic communication with the prescriber (common to all eight patients), who, by his estimation, in view of the nature of the transactions, were likely complicit in diversion.

Id.

On January 9, 2012, Professor Doering received the spreadsheets from the DEA Investigator Hamilton. Tr. 799. At this time, Investigator Hamilton explained to Professor Doering how to access each file and what the data in the file represented. Tr. 800. Professor Doering spent approximately twelve to fourteen hours with the spreadsheets. Tr. 812. One spreadsheet, Government Exhibit 22, was sent to Professor Doering with the highlights reflected in the exhibit. Tr. 809-10.

Professor Doering made like observations and a like conclusion regarding the resolvability of four similar controlled substance dispensing events which occurred on September 24, 2010, at Respondent 219. Gov't Ex. 57 at 33; Tr. 723-25. Doering concluded that the confluence of these out-of-Florida patients on a single day receiving the same medications in the same quantities from the same in-Florida prescriber, was “highly, highly unlikely.” Tr. 725. Based on this conclusion, Professor Doering testified that, he is “simply not going to fill those prescriptions,” and that nothing could be presented in a hard copy of the prescription scrips that could alter his opinion on the matter with respect to either the August 16 or September 24 dispensing events. Tr. 739-41.

According to Professor Doering, four dispensing events at Respondent 219 which occurred between August 29-30, 2010, presented similarly unresolvable red flags. Gov't Ex. 57 at 15; Tr. 752-58. Doering testified that “it's the conflagration or a combination of things that suggest to me that these prescriptions were not issued in the usual course of medical practice.” Tr. 757-58. Similar testimony was elicited regarding four controlled dispensing events regarding the same Respondent (219) on August 19, 2010. Gov't Ex. 57 at 38; Tr. 759-64. Again, these red flags, in Doering's view, were not resolvable when examined collectively. Tr. 763-64.

Additional dispensing events which occurred at Respondent 219 on August 16, 2010, were also addressed by Professor Doering. Tr. 917-20; Gov't Ex 57 at 33. Of eight oxycodone 30 mg prescriptions dispensed that date issued by a particular Fort Lauderdale physician, only two had patient addresses in Florida. Tr. 919-20. Doering testified that a reasonable and prudent pharmacist would need to resolve this anomaly prior to filling the prescriptions. Tr. 920.

In similar fashion, Professor Doering addressed four controlled substance dispensing events that occurred at Respondent 5195 on August 26, 2010. Gov't Ex. 57 at 29; Tr. 741-51. Doering found unresolvable red flags based upon the combination of the cash-discount

method of payments, the out-of-Florida addresses of the presenting patients, the distance between the patients' home addresses and the Pompano Beach, Florida prescriber, the “high alert” nature of the dispensed controlled substances, and the close sequential nature of the transaction numbers, which suggested to him that the medications were dispensed in close temporal proximity.

Tr. 751. Like red flags, which according to Professor Doering, presented unresolvable impediments to dispensing within the standard, were identified regarding six (6) controlled-substance dispensing events which occurred at Respondent 5195 on August 11, 2010, regarding prescriptions emanating from the same West Palm Beach, Florida prescriber. Gov't Ex. 57 at 35; Tr. 764-76. Doering testified that the West Palm Beach provider is “roughly” 200 miles from Respondent 5195. Tr. 915. Among that group, Professor Doering testified that two of the patients, who had the same last name, lived in the same out-of-Florida address,

and received the same quantity of the same controlled substances from the same Pompano Beach physician, were sufficiently questionable that he characterized the confluence of red flags as “an attention getter.” Tr. 776. Doering characterized the aggregate of the red flags present as not amenable to sufficient resolution to warrant dispensing. Tr. 916.

As discussed,

infra,

Joseph Abbott, CVS Vice President of Pharmacy Operations, testified that “cash discount” on the CVS-furnished spreadsheets denotes that, although, like the “cash” designation, full payment was made at the time of the transaction, some manner of group discount (e.g., AARP) was utilized at the time of payment and these transactions may include both cash and credit card payments. Tr. 1234-35. It seems clear from the record that these are transactions where the customers did

not

have the benefit of health insurance assistance. Professor Doering conceded that if “cash discount” merely denoted that the patients utilized an AAA discount at the time of purchase that this aspect would lose its potency as a red flag. Tr. 847. However, according to Professor Doering, even if the “cash discount” red flag aspect were eliminated from the equation, the remaining red flags are still unresolvable. Tr. 924-25.

Professor Doering did concede, however, that he was not aware at what point a prescription number is assigned to a dispensing event at CVS stores, Tr. 832-33, 876, but testified that he “would bet a dime to a Dunkin' Donut that [the events with close prescription numbers] were presented in proximity to one another * * *.”

Id.

at 926-27.

Professor Doering testified that the single in-Florida oxycodone dispensing event entry on that day reflected a patient address in Pompano Beach, Florida, over 200 miles from Respondent 5195. Tr. 915-16.

Professor Doering also highlighted prescribing red flags relative to medications dispensed to four patients on prescriptions issued by one Longwood, Florida physician on December 23, 2010. On that date, at each of the two Respondent pharmacies, two patients were provided identical quantities of oxycodone 30 mg, oxycodone 15 mg, and alprazolam 2 mg. Stated differently, all four patients received exactly the same quantities of the same medications in the same strength. Gov't Ex. 55 at 15, 47 (Respondent 219) and 62, 74 (Respondent 5195); Tr. 784-86. Professor Doering explained the red flags he identified as follows:

Well, from a clinical pharmacist perspective that combination of

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