# Superior Pharmacy I and Superior Pharmacy II Decision and Order

> Briefs, arguments, decisions, and more.

URL: https://www.frixlaw.com/law-library/documents/fr%3A2016-11550

## Record

- **Collection:** Federal Register
- **Document type:** Notice
- **Published:** May 18, 2016
- **Citation:** 81 FR 31310

## Text

DEPARTMENT OF JUSTICE
Drug Enforcement Administration
[Docket Nos. 15-6 and 15-7]
Superior Pharmacy I and Superior Pharmacy II Decision and Order
This is a consolidated proceeding involving two pharmacies located in Tampa, Florida with common ownership. On October 8, 2014, the Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration issued an Order to Show Cause to Superior Pharmacy, L.L.C. (hereinafter, Superior II), which proposed the revocation of its DEA Certificate of Registration BS9699731, pursuant to which it is authorized to dispense controlled substances in schedules II through V as a retail pharmacy, at the registered location of 5416 Town `N' Country Blvd. ALJ Ex. 1, at 1 (No. 15-7). The next day, the Deputy Assistant Administrator issued an Order to Show Cause to Superior Pharmacy, L.L.C. (hereinafter, Superior I), which proposed the revocation of its DEA Certificate of Registration BS9255274, pursuant to which it is authorized to dispense controlled substances in schedules II through V as a retail pharmacy, at the registered location of 3007 W. Cypress Street, Suite 1. ALJ Ex. 1, at 1 (No. 15-6).

As grounds for the proposed actions (which also included the denial of any pending applications), the Show Cause Orders alleged that each pharmacy's “continued registration is inconsistent with the public interest, as that term is defined in 21 U.S.C. 823(f).”
Id.; see also
ALJ Ex. 1, at 1 (No. 15-7); 21 U.S.C. 824(a)(4). Specifically, with respect to each pharmacy, the Orders alleged that their “pharmacists repeatedly failed to exercise their corresponding responsibility to ensure that controlled substances they dispensed were dispensed pursuant to prescriptions issued for legitimate medical purposes by practitioners acting within the usual course of their professional practice” and that their “pharmacists ignored readily identifiable red flags that [the] controlled substances prescribed were being diverted and dispensed despite unresolved red flags.” ALJ Ex. 1, at 1 (No. 15-6); ALJ Ex. 1, at 1 (No. 15-7) (both citing 21 CFR 1306.04(a);
Holiday CVS. L.L.C., d/b/a CVS Pharmacy Nos. 219 and 5195,
77 FR 62315, 62319 (2012)).

The Show Cause Orders further alleged that each pharmacy's “pharmacists dispensed controlled substances when they knew or should have known that the prescriptions were not issued in the usual course of professional practice or for a legitimate medical purpose, including circumstances where the pharmacist knew or should have known that the controlled substances were abused and/or diverted by the customer.” ALJ Ex. 1, at 2 (No. 15-6); ALJ Ex. 1, at 2 (No. 15-7). Each Show Cause Order then listed various red flags which each Respondent's pharmacists allegedly failed to resolve before dispensing prescriptions, including: (1) “Multiple individuals presenting prescriptions for the same drugs in the same quantities from the same doctor”; (2) “individuals presenting prescriptions for controlled substances known to be highly abused, such as oxycodone and hydromorphone”; (3) “individuals paying . . . for controlled substances with cash”;
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and (4) “individuals residing long distances from the pharmacy.” ALJ Ex. 1, at 2 (No. 15-6); ALJ Ex. 1, at 2 (No. 15-7). Each Show Cause Order then set forth allegations of specific instances in which Respondents' pharmacists dispensed oxycodone 30 mg or hydromorphone 8 mg without resolving various red flags presented by the patients and/or the prescriptions; the Order further alleged that several of these prescriptions were facially invalid because they lacked the patient's address. ALJ Ex 1, at 2 (No. 15-6); ALJ Ex. 1, at 2 (No. 15-7).

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With respect to Superior I, the Show Cause Order stated the red flag as “individuals paying high prices for prescriptions for controlled substances with cash.” ALJ 1, at 2 (No. 15-6).

Each Show Cause Order further alleged that Respondents' pharmacists dispensed hydromorphone, notwithstanding that the “dosage amounts . . . if taken as directed, far exceeded the recommended dosages of hydromorphone that should be taken on a daily basis.” ALJ Ex. 1, at 2 (No. 15-6); ALJ Ex. 1, at 3 (No. 15-7). The Superior I Order also alleged that its pharmacists dispensed prescriptions, which were written by the same doctor on the same day, for “large and substantially similar quantities of” oxycodone 30 mg, “to two customers . . . both of whom resided at the same address,” in a town “located approximately [449 miles] from” the pharmacy. ALJ Ex. 1, at 2 (No. 15-6). Likewise, the Superior II order alleged that its “pharmacists dispensed large and substantially similar quantities of hydromorphone and oxycodone to two individuals with the same last name who received their prescriptions on the same day from doctors at the same clinic.” ALJ Ex. 1, at 3 (No. 15-7).

In addition, the Superior I Order alleged that the pharmacy “failed to create and maintain accurate [schedule II order forms] in violation of 21 U.S.C. 842(a)(5),” and that “[a]t least two [of its] pharmacists . . . shared a private key (password) for digitally signing” controlled substances orders, “in violation of 21 CFR 1311.30(a), (c), and (e).” ALJ Ex. 1, at 3-4 (No. 15-6). Finally, the Superior I Order alleged that a DEA audit for the period of May 2, 2011 through February 4, 2013 found,
inter alia,
that the pharmacy was short 15,560 dosage units (du) of oxycodone 30 mg; 11,951 du of hydromorphone 8 mg; 946 du of hydromorphone 4 mg; and 864 du of methadone 10 mg.
Id.
at 4.

The Superior II Order alleged that it had also failed to maintain accurate schedule II order forms and had failed to retain copy three of these forms as required by DEA regulations. ALJ Ex. 1, at 3 (No. 15-7) (citing 21 CFR 1305.13(a) & (e);
id.
§ 1305.17(a); 21 U.S.C. 827(b)). The Order further alleged that the pharmacy failed to create records of the quantity and date received for orders it placed using the Controlled Substances Ordering System (CSOS) and that it “also failed to electronically archive and link these records to the original order.”
Id.
at 4. Finally, the Superior II Order alleged that a DEA audit for the period of July 31, 2012 through February 4, 2013 found,
inter alia,
that the pharmacy had overages of 2,576 du of hydromorphone 8 mg; 1,189 du of oxycodone 30; and 896 du of methadone 10 mg.

The Show Cause Order issued to Superior I was served on October 17, 2014, and the Show Cause Order issued to Superior II was served on October 16, 2014.
See
ALJ Ex. 3 (No. 15-6); ALJ Ex. 4 (No. 15-7). On November 14, 2014, each pharmacy, through its counsel, requested a hearing on the allegations.
See
ALJ Ex. 2 (No. 15-6); ALJ Ex. 3 (No. 15-7). Each matter was placed on the docket of the Office of Administrative Law Judges and assigned to Administrative Law Judge (ALJ) Christopher B. McNeil.

The Prehearing Motions and Rulings

On December 3, 2014, the ALJ issued an Order for Prehearing Statements and Setting the Matter for Hearing (hereinafter, Prehearing Order) in each case.
See
ALJ Ex. 5 (No. 15-6); ALJ Ex. 6 (No. 15-7). In each Prehearing Order, the ALJ directed the Government to file its Pre-hearing Statement no later than 2 p.m. on December 22, 2014, and each Respondent to file its Prehearing Statement no later than 2 p.m. on January 5, 2015. ALJ Ex. 5, at 1 (No. 15-

6); ALJ Ex. 6, at 1 (No. 15-7). The Orders also directed the parties to “[p]rovide the names and current addresses of all witnesses whose testimony is to be presented,” and that “[i]f the Respondent's corporate representative intends to testify, the representative must be listed, and a summary of anticipated testimony as described below must be provided.” ALJ Ex. 5, at 2 (No. 15-6); ALJ Ex. 6, at 2 (No. 15-7). The ALJ's Orders provided the following instruction regarding the summaries of testimony:

Provide a brief summary of the testimony of each witness, with counsel for the Government to indicate clearly each and every act, omission or occurrence upon which it relies in seeking to revoke the Respondent's Certificate of Registration, and counsel for Respondent to indicate clearly each and every matter as to which Respondent intends to introduce evidence in opposition. The summaries are to state what the testimony will be, rather than merely listing the areas to be covered. The parties are reminded that testimony not disclosed in the prehearing statements or pursuant to subsequent rulings is likely to be excluded at the hearing.

ALJ Ex. 5, at 2 (No. 15-6); ALJ Ex. 6, at 2 (No. 15-7).

The ALJ's Orders also provided that “[a]ny requests for subpoena[s] are to be filed by 2:00 p.m. E.S.T. on January 12, 2015,” and that “[s]ubpoena requests that do not comply with these instructions will be returned to the requestor without further action.”
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ALJ Ex. 5, at 4 (No. 15-6); ALJ Ex. 6, at 4 (No. 15-7). The ALJ's Orders further provided that “[w]henever a party seeks to file any document, motion, exhibit or otherwise communicate in writing with the Administrative Law Judge, the party must provide a true copy of the same to the opposing party, using the contact information shown in the Certificate of Service below . . . [and] [t]he party making such a filing shall include a `Certificate of Service' stating that a true copy of the submission has been provided to the opposing party, and shall specify the means by which” this was accomplished. ALJ Ex. 5, at 5-6 (No. 15-6); ALJ Ex. 6, at 5-6 (No. 15-7).

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The Order further required that “[a]ny motion to quash a subpoena must be filed within three working days of receipt of the subpoena request and must be served on the opposing party.” ALJ Ex. 5, at 4-5 (No. 15-6); ALJ Ex. 6, at 4-5 (No. 15-7).

Finally, the ALJ's Orders directed the parties to file their proposed exhibits with his Office no later than 2:00 p.m. on January 12, 2015; it also directed that a copy of the exhibits be served on the opposing party. ALJ Ex. 5, at 2 (No. 15-6); ALJ Ex. 6, at 2 (No. 15-7). The ALJ's Orders further directed that “[w]hen any party seeks to . . . present proposed exhibits,” the party must “timely provid[e] the OALJ with a facsimile copy” and “must mail hard copy filings sufficiently in advance of the due date to assure timely receipt by the hearing clerk” as well as “that documents are to be filed in triplicate.” ALJ Ex. 5, at 5-6 (No. 15-6); ALJ Ex. 6, at 5-6 (No. 15-7).

In his Orders, the ALJ also noted that the cases appeared to “involve common questions of law or fact” and thus directed the parties to address whether they should be consolidated. ALJ Ex. 5, at 3 (No. 15-6); ALJ Ex. 6, at 3 (No. 15-7). Thereafter, the Government moved to consolidate the cases (as well as two other cases). Respondent opposed the Government's motion.

On December 22, 2014, the Government filed its Prehearing Statements with respect to each pharmacy. In each of these, the Government disclosed that it intended to elicit testimony from an expert regarding his review of “numerous controlled substance prescriptions filled by Respondent that contained one or more red flags for diversion which Respondent never resolved.” ALJ Ex. 6, at 3 (No. 15-6); ALJ Ex. 8, at 3-4 (No. 15-7). The Government then identified the same set of seven red flags. ALJ Ex. 6, at 3 (No. 15-6); ALJ Ex. 8, at 3-4 (No. 15-7). With respect to both pharmacies, the Government then set forth the expert's proposed testimony regarding various oxycodone 30 mg prescriptions and the red flags they presented, as well as his proposed testimony regarding the pharmacy's dispensing of large quantities of hydromorphone and the red flags they presented. ALJ Ex. 6, at 4 (No. 15-6); ALJ Ex. 8, at 3-4 (No. 15-7). And with respect to Superior I, the Government also disclosed that the expert “will also testify about a customer who willingly purchased a prescription for oxycodone . . . that costs 37% more than the same prescription four months earlier,” and “that this fact, combined with the fact that the prescription was facially invalid [as it contained] no patient address constituted a red flag for diversion.” ALJ Ex. 6, at 5 (No. 15-6).

The Government then noticed both Respondents that its expert “will testify that the facts surrounding the prescriptions listed above constituted red flags for diversion and that there is no evidence that any of the red flags were resolved prior to distributing the controlled substances to the customers.”
Id.
at 3 (No. 15-6). Finally, it noticed Respondents that its expert “will testify that . . . Respondent[s'] pharmacists failed to exercise their corresponding responsibility to ensure that prescriptions for controlled substances were issued for a legitimate medical purpose in the usual course of professional practice.” ALJ Ex. 6, at 3 (No. 15-6); ALJ Ex. 8, at 3-4 (No. 15-7).

On January 5, 2015, each Respondent filed a “Motion to Compel” and a “Motion for Enlargement of Time to File . . . Pre-hearing Statement,” as well as a Prehearing Statement. ALJ Exs. 9, 10, 11 (No. 15-6); ALJ Exs. 9, 10, 12 (No. 15-7). In their Motions to Compel, each Respondent noted that on February 4, 2013, DEA had executed an Administrative Inspection Warrant at it and sought an Order from the ALJ requiring the Government to disclose the documents and testimony submitted by DEA Investigators to the Federal Magistrate Judge in obtaining the Warrants. ALJ Ex. 10, at 2 (No.15-6); ALJ Ex 10, at 2 (No. 15-7). Each Respondent's Motion to Compel also sought to require the Government to: (1) Provide “full and complete copies of all computer data seized . . . during the execution of the” warrant; (2) identify “all DEA personnel involved in the preparation and execution of the [warrant] and the subsequent review and analysis of the information, records, and data seized”; and (3) provide “reports of, and the substance of, any statements made to DEA investigators by [Respondent's] staff.” ALJ Ex. 10, at 5 (No.15-6); ALJ Ex 10, at 5 (No. 15-7).

Each Respondent also sought an extension of the time to file its Prehearing Statement to the end of March 2015 and sought to reschedule the hearing “to no sooner than June 2015.” ALJ Ex. 11, at 3 (No. 15-6); ALJ Ex. 9 (No. 15-7). As support for the motions, Respondents argued that since the execution of the warrants, the Government had 20 months to review the records, and that “[d]uring this time, the information was not available to Respondent.” ALJ Ex. 11, at 3 (No. 15-6); ALJ Ex. 9, at 3 (No. 15-7). Respondents further argued “[w]hile a portion of the seized information, most notably the prescriptions, was provided to Respondent[s] in electronic format, the sheer volume of information coupled with the unreasonably short deadlines surrounding the holiday season make analysis of the information by [it] impossible.” ALJ Ex. 11, at 3 (No. 15-6); ALJ Ex. 9, at 3 (No. 15-7). Respondents further argued that “due process requires, and good cause exists, for a significant” extension of the time to file the Prehearing Statements and “to prepare for a lengthy hearing in” these

matters. ALJ Ex. 11, at 3 (No. 15-6); ALJ Ex. 9, at 3 (No. 15-7).

The Government opposed these motions. With respect to the Motions to Compel, the Government argued that in its Prehearing Statements, it had provided a summary of the testimony it intended to elicit as well as a list of the exhibits it intended to offer; the Government also noted that several weeks earlier, it had met with one of Respondents' counsels and that at no time then or since its motion, had Respondents' counsel “communicate[d] a need for, or request[ed] any” of the information it sought through the motions. ALJ Ex. 16, at 3 (No. 15-7). The Government further argued that it had fully complied with its disclosure obligations, and that to the extent Respondents were seeking discovery, “ `[t]here is . . . no general right to discovery under either the APA or DEA regulations, but rather only a limited right to receive in advance of the hearing the documentary evidence and summaries of the testimony which the Government intends to rely upon.' ” ALJ Ex. 16, at 4 (No. 15-7) (quoting
Roy E. Berkowitz,
74 FR 36758, 36760 (2009)). Finally, the Government argued that to the extent Respondents were asserting that they had a right to receive these materials as a matter of due process, “Respondent[s] ha[d] not even articulated how the requested materials might be relevant to this proceeding.” ALJ Ex. 16, at 5 (No. 15-7).

Each Respondent filed a Reply to [the] Government's Response to Motion to Compel. ALJ Ex. 27 (No. 15-6); ALJ Ex.18 (No. 15-7). Therein, Respondents contended that they were entitled to the documents as a matter of due process because the Government had represented that one of its proposed witnesses (a Diversion Investigator) would testify regarding his/her interviews with Respondents' staff and that they would be prejudiced if the Government did not provide the “same.” ALJ Ex. 27, at 2 (No. 15-6); ALJ Ex. 18, at 2 (No. 15-7). Respondents further asserted that the “information is essential,” because the Government intended to put on evidence that the prescriptions raised red flags and that “Respondent[s] fail[ed] to exercise [their] corresponding responsibility to resolve the `red flag[s],' ” and the Government “has not identified one patient or doctor related to the prescriptions allegedly containing unresolved red flags.” ALJ Ex. 27, at 2 (No. 15-6); ALJ Ex. 18, at 2 (No. 15-7).

The Government also opposed Respondents' Motions for Enlargement of Time. ALJ Ex. 16, at 6 (No. 15-7). The Government argued that the Show Cause Orders and Prehearing Statements had “specifically outlined” the allegations, “as well as the approximate number of documents it intend[ed] to introduce into evidence.”
Id.
The Government further argued that it was “patently specious” for Respondents “[t]o characterize this matter as something much more voluminous and complicated than what it is and, as a result, argue that further delay is necessary.”
Id.
The Government also contended that to the extent Respondents were seeking an extension to review records and prescriptions beyond those referenced in the Show Cause Orders and its Prehearing Statements, those documents were not “material to the allegation that he [sic] unlawfully dispensed to customers identified in the OTSC and Government's Prehearing Statement.”
Id.
at 6-7.

On January 5, 2015, the ALJ denied Respondents' Motions for Enlargement. ALJ Ex. 11, at 3 (No. 15-7); ALJ Ex. 12, at 4 (No. 15-6). The ALJ specifically noted “that since at least October 16, 2014, Respondent[s] ha[ve] been informed of the nature of the charges presented in the Order to Show Cause,” and that in their motions, Respondents had acknowledged that the Government had provided them with the prescriptions. ALJ Ex. 11, at 3 (No. 15-7); ALJ Ex. 12, at 3 (No. 15-6). The ALJ explained that neither Respondent had “established that it has been prevented from evaluating those prescriptions identified in the Order to Show Cause [or] that it has been prevented from preparing its prehearing statement.” ALJ Ex. 11, at 3 (No. 15-7); ALJ Ex. 12, at 3 (No. 15-6). The ALJ also explained that Respondents had known since the issuance of his Prehearing Orders that they were required “to object to any term of that Order by not later than December 10, 2014,” and that they failed to object to the orders until the day their Prehearing Statements were due. ALJ Ex. 11, at 3 (No. 15-7); ALJ Ex. 12, at 3 (No. 15-6). The ALJ thus concluded that:

I am compelled to consider the nature of the allegations, which if proved suggest Respondent[s'] ability to fill controlled substance prescriptions would be inconsistent with the public interest. I am further compelled to consider Respondent[s'] own role in attempting to delay th[ese] proceeding[s], given that [they] failed to timely object to the deadlines set forth in the Order[s]. I am further compelled to consider fairness to all parties, and the convenience of witnesses now identified by the Government in its timely prehearing statement[s]. I am further compelled to consider the need for orderly and prompt administration of justice. All of these considerations compel my finding that good cause has not been shown for either enlarging the time for Respondent[s] to file [their] prehearing statement[s], or for continuing the hearing now set to being on January 27, 2015.

ALJ Ex. 11, at 3 (No. 15-7); ALJ Ex. 12, at 3 (No. 15-6).

The same day (according to OALJ date stamps), each Respondent filed its Prehearing Statement. ALJ Ex. 9 (No. 15-6); ALJ Ex. 12 (No. 15-7). Each Respondent proposed as witnesses “[a]ny and all patients whose prescriptions were seized . . . pursuant to the Administrative Inspection Warrant executed [on] February 4, 2013 or whose prescriptions for controlled substances were dispensed between January 1, 2011 and February 4, 2013.” ALJ Ex. 9, at 3 (No. 15-6); ALJ Ex. 12, at 3 (No. 15-7). Respondent Superior I further attached a list of 2,355 purported patients, ALJ Ex. 9, at Attachment A (No. 15-6); and Respondent Superior II attached a list of 2,253 purported patients. ALJ Ex. 12, at Attachment A (No. 15-7). As for the required summary of anticipated testimony, each Respondent proposed that:

These patients will each be asked to provide testimony regarding their medical history, injuries and related pathology, interactions with treating physicians and dispensing pharmacists, effectiveness of the prescribed controlled substances, continuity of treatment, their reasons for patronage of Superior Pharmacy, LLC . . . such other testimony relevant to the Government's allegation that any of these prescriptions raised `red flags' which should have caused pharmacists to refuse to dispense the prescribed controlled substances.

ALJ Ex. 9, at 4 (No. 15-6); ALJ Ex. 12, at 4 (No. 15-7).

Respondents further proposed as witnesses “[a]ny and all physicians who issued the prescriptions seized . . . pursuant to the Administrative Inspection Warrant[s] . . . or whose prescriptions for controlled substances were dispensed at [them] between January 1, 2011 and February 4, 2013,” as well as “[a]ny and all physicians who issued prescriptions for controlled substances to the patients identified . . . above after February 4, 2013.” ALJ Ex. 9, at 3 (No. 15-6); ALJ Ex. 12, at 3 (No. 15-7). Each Respondent attached a list of several hundred physicians who had purportedly issued the controlled substance prescriptions dispensed by them. ALJ Ex. 9, at Attachment B (No. 15-6); ALJ Ex. 12, at Attachment B (No. 15-7). As for the anticipated testimony of the physicians, Respondents represented that:

These physicians will confirm they performed adequate and appropriate physical examinations of the patients to whom they

issued prescriptions for controlled substances, communication with the dispensing pharmacies regarding such prescriptions, the reasonableness and necessity of the prescriptions to control the pain or other complaints of their patients as required by the standard of care and Florida statutes.

ALJ Ex. 9, at 4 (No. 15-6); ALJ Ex. 12, at 4 (No. 15-7).

Next, Respondents proposed as witnesses “[a]ny and all pharmacists who dispensed prescriptions for controlled substances to the patients identified . . . above
after
February 4, 2013.” ALJ Ex. 9, at 3 (No. 15-6); ALJ Ex. 12, at 3 (No. 15-7) (emphasis added). As for their anticipated testimony, Respondents represented that “[t]hese pharmacists will describe the information they obtained from the patients, physicians and other sources in order to resolve `red flags,' if any, raised by the described prescriptions for controlled substances.” ALJ Ex. 9, at 5 (No. 15-6); ALJ Ex. 12, at 5 (No. 15-7). Respondent did not, however, provide the names of any of the pharmacists. ALJ Ex. 9, at 3 (No. 15-6); ALJ Ex. 12, at 3 (No. 15-7).

Respondents also proposed as a witness Mr. Sam Badawi, a pharmacist and attorney. ALJ Ex. 9, at 3 (No. 15-6); ALJ Ex. 12, at 3 (No. 15-7). As for Mr. Badawi's anticipated testimony, Respondents represented that he:

will testify regarding his qualifications as an expert in the field of pharmacy and the legal and ethical responsibilities of the pharmacists dispensing prescriptions at [each Respondent], the procedures used at [each Respondent] to consider and resolve `red flags,' inventory, ordering and CSOS compliance issues. Mr. Badawi will further testify that he had reviewed the prescriptions at issue, the relevant inventory and ordering records and prepared summaries of the prescription dispensing activity at [each pharmacy] during 2011 and 2012, and identified significant errors in the inventory performed by the DEA.

ALJ Ex. 9, at 6 (No. 15-6); ALJ Ex. 12, at 6 (No. 15-7).

Respondents further proposed as a witness Mr. Jack Crowley of Gates Healthcare Associates. Respondents represented that Mr. Crowley:

will testify regarding his knowledge and experience in the investigation, preparation and execution of Administrative Inspection Warrants and the subsequent investigation required. [He] will testify regarding errors in the audits performed by the agents/investigators involved in the investigation of [Respondents]. [He] reviewed the prescriptions, inventory and CSOS records of [Respondents]. [He] will further testify regarding [Respondents'] procedure[s] for resolving potential `red flag' issues and compliance with recordkeeping requirements related to inventory records, DEA-222 order forms and CSOS issues.

ALJ Ex. 9, at 5 (No. 15-6); ALJ Ex. 12, at 5 (No. 15-7).
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3
Respondents also proposed as witnesses each person “who participated in the preparation of the application for the Administrative Inspection Warrant[s],” as well as each person “who participated in the execution of the Administrative Inspection Warrant[s].” ALJ Ex. 9, at 3-4 (No. 15-6); ALJ Ex. 12, at 3-4 (No. 15-7).

On January 9, 2012, each Respondent filed a motion to enlarge the time for filing its proposed exhibits or to alternatively provide its proposed exhibits electronically, as well as a motion to enlarge the time to file its requests for subpoenas. ALJ Ex. 22 (No. 15-6); ALJ Ex. 23 (No. 15-7). In its motion, Superior I explained that its “Prehearing Statement identifies four categories of proposed exhibits which consist of 23,032 documents,” of which “20,925 pages represent the documents seized, and provided to Respondent electronically, by the DEA.” ALJ Ex. 22, at 2 (No. 15-6). Superior I explained that to comply with the ALJ's Pre-hearing Order, which required that three copies of each exhibit be filed with the OALJ and one copy be filed with opposing counsel, this would require more than 92,000 pages and “approximately nineteen standard boxes of paper, which is approximately 950 pounds.”
Id.
Superior I further explained that because of the volume of copying needed to comply with the Pre-hearing Order, the documents would have to be sent “to a third party for reproduction” and “the reproduction cannot be completed in the allotted time.”
Id.
at 3. As for its subpoena requests, Superior I contended that the ALJ's Prehearing Order was ambiguous “as to whether the requests and completed subpoenas are to be filed in triplicate with the Hearing Clerk,” and because it was seeking to subpoena 2,861 witnesses, it “cannot complete the . . . requests . . . with the completed subpoenas using the required template in the allotted time.”
Id.

Superior II made similar assertions to Superior I, noting that its proposed exhibits “consist of 32,123 documents,” of which “30,441 pages represent the documents seized, and provided to [it] electronically, by the DEA,” and that to comply with the ALJ's Prehearing Order, it would have to provide more than 128,000 pages of documents, and require “approximately 1,300 pounds” of paper. ALJ Ex. 23, at 2 (No. 15-7). As did Superior I, Superior II asserted that it would have to use a third-party to perform the necessary copying, which could not “be completed in the allotted time.”
Id.
at 3. Superior II also asserted that it could not complete the 2,549 subpoena requests for its proposed witnesses on time.
Id.

On January 12, 2015, each Respondent submitted a letter (dated Jan. 9) to the Hearing Clerk along with thumb drives which contained “the images of each of the exhibits in [its] Prehearing Statement.” ALJ Ex. 24 (No. 15-6); ALJ Ex. 24 (No. 15-7). Each Respondent's letter also advised that the paper copies of the subpoena requests would be hand delivered on Monday, January 12, 2015, and on that date, the ALJ “received more than 3,000 written requests for the issuance of subpoenas in the[] two cases.” Tr. 18;
see also
ALJ Ex. 24 (No. 15-6); ALJ Ex. 24 (No. 15-7). According to the ALJ, neither Respondent provided “a certificate of service establishing that [they] ha[d] provided the Government with a true copy of these requests.” Tr. 18.

The same day, the ALJ's Law Clerk sent a letter under his own signature to each Respondent's Counsel noting that the OALJ had received the thumb drives. ALJ Ex. 28 (No. 15-6); ALJ Ex. 28 (No. 15-7). The Law Clerk then explained that he was returning the thumb drives to each Respondent's counsel because “[t]he submission of the thumb drive does not adhere to the” ALJ's Prehearing Order of December 3, 2014. ALJ Ex. 28 (No. 15-6); ALJ Ex. 28 (No. 15-7).

On January 12, the ALJ denied each Respondent's Motion to Compel. The ALJ noted that in the case of
Edge Pharmacy
(Docket No. 15-3), the respondent had sought to compel the disclosure of much of the same material as sought by Superiors I and II. ALJ Ex. 29, at 4 (No. 15-6); ALJ Ex. 29, at 4 (No. 15-7). The ALJ further noted that in
Edge,
the Chief Administrative Law Judge (CALJ) had denied the motion of the respondent on the ground that it did “not comport with the narrowly-focused grant of authority in 21 CFR 1316.52(d),” and that the respondent did “not seek to compel . . . the class of documents discoverable under the [Administrative Procedure Act] or subject to inspection under DEA regulations.” ALJ Ex. 29, at 4 (No. 15-6); ALJ Ex. 29, at 4 (No. 15-7). As for the reports and the substance of any statements made by Respondents' staff to the Agency's Investigators, the ALJ also found that the CALJ's reasoning applied to these materials. ALJ Ex. 29, at 4 (No. 15-6); ALJ Ex. 29, at 4 (No. 15-7). The ALJ thus concluded that each Respondent had failed to establish its entitlement to the documents. ALJ Ex. 29, at 4 (No. 15-6); ALJ Ex. 29, at 4 (No. 15-7).

The same day, in the Superior I matter, the Government submitted its request for the issuance of subpoenas for four witnesses, and in the Superior II matter, the Government submitted its request for the issuance of subpoenas for five witnesses, all of whom had been previously identified in the respective Prehearing Statement.
4

ALJ Ex. 25, at 1-2 (No. 15-6); ALJ Ex. 25, at 1-2 (No. 15-7). The Government also submitted its proposed exhibits in each matter. Docket Sheet, at 2 (No. 15-6); Docket Sheet, at 2 (No. 15-7).

4
The Government also served a copy of both subpoena requests on each Respondent. ALJ Ex. 25, at 2 (No. 15-6); ALJ Ex. 25, at 2 (No. 15-7).

The Government's Motions To Consolidate

On January 13, 2015, the Government moved to consolidate the cases, along with a third matter (Jet Pharmacy). ALJ Ex. 31 (No. 15-6); ALJ Ex. 31 (No. 15-7). In its motions, the Government argued that there were common issues of law and fact with respect to the pharmacies, noting that it intended to call the same expert in each of the cases and each Respondent had stated that it intended to call the same two experts. ALJ Ex. 31, at 2-3 (No. 15-6); ALJ Ex. 31, at 2-3 (No. 15-7). The Government further argued that the expert's testimony would “account for the bulk of the Government's and likely the Respondents' cases in terms of length of testimony,” and that consolidation would “result in a tremendous conservation of time and resources by allowing the Government to present its expert's testimony in one proceeding rather than in three separate proceedings.” ALJ Ex. 31, at 5 (No. 15-6); ALJ Ex. 31, at 5 (No. 15-7).

The Government also argued that, although “each of the Respondent pharmacies is a separate business entity, there are also strong indications of common ownership, management, and/or control between the Respondents,” and that Superior I and II “are both owned and operated by Victor Obi-Anadiume.”
5

ALJ Ex. 31, at 3 (No. 15-6); ALJ Ex. 31, at 3 (No. 15-7). As support for this assertion, the Government attached to its motions various documents it obtained from the Florida Department of Heath showing that Victor Obi owned both Superior I and II. The Government thus maintained that consolidation was warranted “because the conduct of one Respondent may be imputed to other Respondents if it can be shown that the same individuals responsible for misconduct at one pharmacy also managed and/or controlled other pharmacies.” ALJ Ex. 31, at 5 (No. 15-6); ALJ Ex. 31, at 5 (No. 15-7).

5
Mr. Obi-Anadiume is also referred to as Mr. Obi throughout this decision.

Each Respondent filed identical oppositions to the Government's motions.
See
ALJ Ex. 30 (No. 15-6); ALJ Ex. 32 (No. 15-7). Therein, Respondents argued that “it is not . . . sufficient for two (2) actions to have a common defendant or one common issue of law” and that “other considerations are necessary such as whether maintaining separate actions would lead to inconsistent rulings on similar issues of fact and law and to ensure that the same standard is applied to the determination of such issues as they arise in each case.” ALJ Ex. 30, at 3-4 (No. 15-6); ALJ Ex. 32, at 3-4 (No. 15-7) (citation omitted). Respondents also argued that consolidation of the cases “may cause unnecessary confusion for the fact finder and prejudice to the parties.” ALJ Ex. 30, at 4 (No. 15-6); ALJ Ex. 32, at 4 (No. 15-7) (citation omitted).

Respondents then maintained that “because each prescription represents a different pattern of facts, it appears there is no overlapping factual issue between the two matters,” and “[a]s such, there is no risk of inconsistent results” which would support consolidation. ALJ Ex. 30, at 5 (No. 15-6); ALJ Ex. 32, at 5 (No. 15-7). Respondents further maintained that “there is a high risk that one defendant could be prejudiced by evidence relating to another defendant.” ALJ Ex. 30, at 5 (No. 15-6); ALJ Ex. 32, at 5 (No. 15-7). Respondents also asserted that consolidation would not promote judicial economy “[b]ecause of the large number . . . and limited overlap of” the witnesses and because “the time necessary to complete the hearing as to both parties could exceed ninety (90) days.” ALJ Ex. 30, at 6 (No. 15-6); ALJ Ex. 32, at 6 (No. 15-7).

On January 15, 2015, each Respondent filed a further pleading, which appear to be identical, on the issue of consolidation. ALJ Ex. 40 (No. 15-6); ALJ Ex. 40 (No. 15-7). In addition to the arguments they previously raised, Respondents contended that “[t]o the extent the government seeks to rely on a single expert to prove its case in all three matters, it heightens the risk of confusion or attempts to conflate issues between three distinct defendants.” ALJ Ex. 40, at 6 (No. 15-6); ALJ Ex. 40, at 6 (No. 15-7). They also argued that “although Respondent[s] share Mr. Obi as a common owner, [he] is not responsible for the day-to-day operations or the implementation of policies and procedures at these separate businesses” as each pharmacy had a “different pharmacy manager[ ].” ALJ Ex. 40, at 7 (No. 15-6); ALJ Ex. 40, at 7 (No. 15-7). Respondents further contended that “Mr. Obi did not dispense medication or otherwise process prescriptions at these pharmacies during all relevant time periods described in the Orders to Show Cause.” ALJ Ex. 40, at 7 (No. 15-6); ALJ Ex. 40, at 7 (No. 15-7).

On January 21, 2015, the ALJ granted the Government's motions with respect to Superior I and Superior II. ALJ Ex. 1 (No. 15-6 & 15-7). The ALJ specifically found that “the Government ha[d] demonstrated the presence of common questions of law and fact with respect to Superior I and Superior II, and ha[d] shown the need to take steps to avoid unnecessary cost or delay.”
Id.
at 7. More specifically, the ALJ found that the Show Cause Orders “set forth substantially similar factual claims” in that “pharmacists at both pharmacies dispensed controlled substances under conditions where the pharmacists knew or should have known that the controlled substances were being either diverted or abused by those who received the substances.”
Id.
The ALJ further found that “[i]n both cases, the [Government] alleged the pharmacists filled prescriptions notwithstanding red flags relating to the unusual distance the patients traveled to have their prescriptions filled, and notwithstanding red flags relating to evidence that the patients were filling multiple prescriptions which bore no address for the patients.”
Id.

The ALJ also rejected Respondents' contention that there was “a substantial risk of prejudice to Respondents in either case.”
Id.
at 8. The ALJ specifically found that “the prospect of hearing from the fact and expert witnesses in both cases will reduce the risk of inconsistencies like those that could arise through separate hearings.”
Id.
The ALJ also “expressly rejected” Respondent's contention that there was a heightened “risk of confusion” because the Government intended to use the same expert to prove its case, explaining that “[o]ne expert can easily address the conduct attributed to pharmacists working at these two pharmacies.”
Id.
Finally, the ALJ reasoned that “[g]iven there is at least some showing of common ownership, the Government should be, and will be, permitted to advance its theory that `the conduct of one Respondent may be imputed to [the] other Respondent[ ] if it can be shown that the same individuals responsible for misconduct at one pharmacy also managed and/or controlled other pharmacies.'”
Id.
(citation omitted). The ALJ thus ordered that the cases against Superior I and

Superior II be consolidated under Docket No. 15-6.
Id.

The Government's Motions
in Limine

On January 15, 2015, the Government also filed a Motion
in Limine
in each matter. Therein, the Government argued that Respondents had failed to comply with the ALJ's Pre-hearing Orders in that they failed to provide adequate summaries of the testimony of their proposed witnesses. With respect to Mr. Badawi, Respondents' proposed expert in pharmacy practice, the Government argued that Respondents' Prehearing Statements “state[d] no facts or conclusions which, if proven, would rebut any allegations that the Government has made in its OTSC[s] or Prehearing statement[s].” ALJ Ex. 36, at 4 (No. 15-6); ALJ Ex. 36, at 4-5 (No. 15-7). The Government specifically argued that while “Respondent[s] state[d] that Mr. Badawi ha[d] `prepared summaries' of prescription activity and identified `errors' in DEA inventory[,] [they] fail[ ] to disclose what those summaries entail or what errors have been discovered.” ALJ Ex. 36, at 4-5 (No. 15-6); ALJ Ex. 36, at 5 (No. 15-7). The Government further argued that Respondents had “also failed to identify a single `procedure used at [the pharmacies] to consider and resolve alleged `red flags,' inventory, ordering and CSO[S] compliance issues.” ALJ Ex. 36, at 5 (No. 15-6); ALJ Ex. 36, at 5 (No. 15-7). The Government also argued that “notably absent from [the] Prehearing Statement[s] is any notice that Mr. Badawi will opine that any of the prescriptions identified in the [Show Cause Orders] and the Government's Prehearing Statement[s] were issued in compliance with federal or state law.” ALJ Ex. 36, at 5 (No. 15-6); ALJ Ex. 36, at 5 (No. 15-7).

As for Respondents' disclosures pertaining to the testimony of Mr. Crowley, the Government argued that “no facts [were] proffered to give [it] any notice regarding [his] conclusions regarding audit errors, or the basis for those conclusions, should they exist.” ALJ Ex. 36, at 5 (No. 15-6); ALJ Ex. 36, at 5 (No. 15-7). The Government also argued that while Respondents proposed that this witness would testify regarding their procedures for resolving red flags and complying with other requirements, Respondent had not “offer[ed] a single fact or detail to describe, identify, or explain that procedure.” ALJ Ex. 36, at 5 (No. 15-6); ALJ Ex. 36, at 5 (No. 15-7). The Government further contended that it is unclear whether this witness's proposed testimony would discuss the procedures in place during the period of the alleged misconduct or as to procedures subsequently instituted. ALJ Ex. 36, at 6 (No. 15-6); ALJ Ex. 36, at 6 (No. 15-7). Finally, the Government argued that Respondents' disclosure was “void of any detail about the information [this witness] reviewed to form his opinions about the DEA audits or the procedures Respondents employed at their pharmacy.” ALJ Ex. 36, at 6 (No. 15-6); ALJ Ex. 36, at 6 (No. 15-7).

Addressing Respondents' proposed taking of the testimony of the numerous patients who filled controlled substance prescriptions at Respondents, the Government maintained that Respondents' disclosure “constitute[d] a wholesale failure to describe `each and every matter as to which [they] intend[ed] to introduce evidence in opposition,' ” as required by the ALJ's Pre-hearing Order. ALJ Ex. 36, at 6 (No. 15-6); ALJ Ex. 36, at 6 (No. 15-7). As for the physicians who wrote the prescriptions, the Government argued that the disclosures were inadequate because “Respondent[s] merely indicate[ ] that these unknown individuals will testify regarding `communication[s] with the dispensing pharmacists regarding such prescriptions,” and “no facts about any such communications are revealed.”
6

ALJ Ex. 36, at 6 (No. 15-6); ALJ Ex. 36, at 6 (No. 15-7).

6
Respondents did, however, disclose the names of the physicians as part of their Prehearing Statements. Respondents also stated that they intended to elicit testimony from the physicians “confirm[ing] [that] they performed adequate and appropriate physical examinations of the patients,” as well as testimony as to “the reasonableness and necessity of the prescriptions to control the pain or other complaints of their patients as required by the standard of care and Florida statutes.” ALJ Ex. 9, at 4 (No. 15-6); ALJ Ex. 12, at 4 (No. 15-7).

The Government also contended that testimony and documentation regarding prescriptions which it did not intend to offer into evidence was irrelevant. ALJ Ex. 36, at 8 (No. 15-6) ALJ Ex. 36, at 8 (No. 15-7). Finally, with respect to the physicians who issued prescriptions filled by Respondents after February 4, 2013 and the pharmacists who filled the prescriptions, the Government argued that Respondent had not even identified these persons and that their proposed testimony was “stated only in general terms [and] lack[ed] conclusions.” ALJ Ex. 36, at 7 (No. 15-6); ALJ Ex. 36, at 7 (No. 15-7).

In its motion, the Government also addressed Respondents' use of a thumb drive to provide its exhibits. ALJ Ex. 36, at 3 (No. 15-6); ALJ Ex. 39, at 3 (No. 15-7). According to the Government, the thumb drive contained “hundreds of different files, which contain, collectively, thousands of pages of documents,” of which only one file, which “consist[ed] of 1490 pages,” “appeared to be marked for identification.” ALJ Ex. 36, at 3-4 (No. 15-6); ALJ Ex. ALJ Ex. 36, at 3-4 (No. 15-7). The Government further stated that the other files were “neither marked for identification nor paginated.” ALJ Ex. 36, at 4 (No. 15-6); ALJ Ex. 36, at 4 (No. 15-7). The Government argued that Respondents' submission of their proposed documentary evidence did not “comply with the ALJ's order in terms of labeling and form.” ALJ Ex. 36, at 8 (No. 15-6); ALJ Ex. 36, at 8 (No. 15-7). The Government also argued that because “none of [Respondents'] summarized testimony reference[d] any particular documents or page, [it was] unable to ascertain whether any of the documents . . . would be relevant to [the] proceeding.” ALJ Ex. 36, at 9 (No. 15-6); ALJ Ex. 36, at 9 (No. 15-7).

On January 21, 2015, each Respondent filed a Response to the Government's Motion; as with Respondents' other filings, the Responses appear to be identical.
Compare
ALJ Ex. 53 (No. 15-6)
with
Response to Government's Motion
In Limine
(No. 15-7) (hereinafter, Superior II Response to Motion
in Limine
).
7

Therein, Respondents argued that the Government's Motions were “completely devoid of intellectual integrity” because the Government's Prehearing Statement “fail[ed] to specifically identify a single prescription or patient and only generally refers to areas of discussion of its witnesses,” including the proposed testimony of its expert witness. ALJ Ex. 53, at 2 (No. 15-6); Superior II Response to Motion
in Limine,
at 2. Respondents also argued that “[t]he Government's Prehearing Statement only identifies two patients by their initials and only one by the alleged city of residence.” ALJ Ex. 53, at 3 (No. 15-6); Superior II Response to Motion
in Limine,
at 3.
8

Respondents thus contended that the Government provided an “inadequate description of the testimony concerning specific patients and prescriptions,” and that they were “placed under extreme prejudice in [their] preparation for this expedited hearing.” ALJ Ex. 53, at 3 (No.

15-6); Superior II Response to Motion
in Limine,
at 3. Respondents also disputed the Government's contention that their argument should be rejected because during a December meeting with Government Counsel, they did not ask for additional information regarding the patients' names. ALJ Ex. 53, at 3 (No. 15-6); Superior II Response to Motion
in Limine,
at 3.

7
While this filing is part of the record, it was not assigned an ALJ Exhibit Number and is not included on the list of ALJ Exhibits in the Superior II matter.

8
While this was true with respect to Superior I, the Government's Prehearing Statement in Superior II identified each of the patients whose prescriptions were at issue by their initials, and with respect to 13 of the patients, either the Prehearing Statement or the Show Cause Order identified the patient's city of residence. ALJ Ex. 1, at 2-3 (No. 15-7); ALJ Ex. 6, at 4-6 (No. 15-7).

Respondents further took issue with the Government's contention (with respect to both pharmacies) that only a small number of the thousands of persons listed in their Prehearing Statements were actually identified as patients. ALJ Ex. 53, at 2 (No. 15-6); Superior II Response to Motion
in Limine,
at 2. According to each Respondent, it listed all of the “patients whose prescriptions were dispensed and doctors who generated the prescriptions [that were] filled at the pharmacy during the relevant time period,” because at the time it filed its Prehearing Statement, the Government was “the only party . . . to know which patients, doctors, and pharmacists are material and relevant to the allegations they chose to include in the” Show Cause Order. ALJ Ex. 53, at 3 (No. 15-6); Superior II Response to Motion
in Limine,
at 3. Respondents thus contend that “the potential exclusion of material and relevant witnesses as requested by the Government . . . would be arbitrary, capricious, and an abuse of discretion.” ALJ Ex. 53, at 3-4 (No. 15-6); Superior II Response to Motion
in Limine,
at 3-4.

As for the Government's contention that Respondents had failed to disclose the proposed testimony of the patients, doctors and pharmacists with adequate specificity, Respondents argued that “without the identification of the prescriptions and/or patients at issue (as defined by the OSC), a specific summary of each and every potentially relevant witness is impossible within the timeframe provided.” ALJ Ex. 53, at 6 (No. 15-6); Superior II Response to Motion
in Limine,
at 6. Continuing, Respondents argued that “[t]he witnesses will confirm their interaction with the pharmacists in resolving `red flags' and verify the prescriptions were issued for a legitimate medical purpose in the usual course of professional practice.” ALJ Ex. 53, at 6 (No. 15-6); Superior II Response to Motion
in Limine,
at 6. Notably, Respondents did not maintain that the pharmacists would testify that they resolved red flags.

As for the Government's attempt to bar the testimony of Mssrs. Badawi and Crowley, Respondents argued that they “ha[d] summarized [their] testimony to the same extent that the Government summarized its proposed testimony.” ALJ Ex. 53, at 5 (No. 15-6); Superior II Response to Motion
in Limine,
at 5. Respondents appeared to argue that they could not offer more detail as to the testimony of these witnesses because they were “without notice of what specific facts and opinions [would] be offered in the Government's prima facie case as the Government chose to not disclose specifics.” ALJ Ex. 53, at 6 (No. 15-6); Superior II Response to Motion
in Limine,
at 6.

As for the Government's attempt to bar their proposed documentary evidence, Respondents argued that they were “prejudiced by the Government's inadequate Prehearing Statement which forced Respondent[s] to incorporate and include all potential documents and witnesses from the relevant time period.” ALJ Ex. 53, at 4 (No. 15-6); Superior II Response to Motion
in Limine,
at 4. Respondents further maintained that “[t]his prejudice would have only been exasperated [sic] by the costs associated with production of multiple sets of paper copies of the voluminous records.” ALJ Ex. 53, at 4 (No. 15-6); Superior II Response to Motion
in Limine,
at 4. Respondents asserted that the electronic files were organized in four separate folders, and the folder which included the documents seized pursuant to the Administrative Inspection Warrant, was simply “a mirror copy, in the exact form, of the digital files
dumped
on Respondent by the DEA at the time of service of the Order to Show Cause.” ALJ Ex. 53, at 4 (No. 15-6); Superior II Response to Motion
in Limine,
at 4. Respondents stated that they had no way of knowing whether folder three “represent[ed] all documents seized and/or reviewed by the Government”; they further argued that “the Government made no attempt to label and/or organize the material provided.” ALJ Ex. 53, at 4 (No. 15-6); Superior II Response to Motion
in Limine,
at 4.

Concluding, Respondents argued that the Government had nearly two years to review the documents and that between February 4, 2013 (the date the AIWs were served) and the dates of service of the Show Cause Orders), “Respondent[s] had no access to these records.” ALJ Ex. 53, at 5 (No. 15-6); Superior II Response to Motion
in Limine,
at 5. Respondents thus argued that to exclude their “proposed testimony and exhibits, based exclusively on circumstances created by the Government, would be an extreme abuse of discretion.” ALJ Ex. 53, at 6 (No. 15-6); Superior II Response to Motion
in Limine,
at 6.

On January 27, 2015, the ALJ conducted the initial day of the hearing during which he addressed the Government's Motions
in Limine.
9

With respect to the proposed testimony of the more than 5,000 patients who filled their prescriptions at Respondents, the ALJ granted the Government's Motions for two reasons. First, he found that Respondents had failed to comply with his Prehearing Order because they had “not described with sufficient detail the testimony of the proposed witnesses.” ALJ Ex. 7, at 3 (No. 15-6/15-7) (Journal Entry and Order From Initial Day of Hearing). Second, he found that the proposed testimony of the patients “would not constitute relevant evidence, given the nature of the charges appearing in the Orders to Show Cause, as elaborated upon by the Government's Prehearing Statements.
Id.

9
While the ALJ termed this day as the initial day of the hearing, he did not take any evidence. Tr. 1-36.

As for the proposed testimony of the physicians, the ALJ found that Respondents' Pre-hearing Statement did “not sufficiently identify the anticipated testimony of the witnesses, nor . . . make a sufficient showing that their testimony would constitute relevant evidence.”
Id.
The ALJ further held that this ruling applied to both those physicians who filled the prescriptions before February 4, 2013, as well as after that date.
Id.
at 3-4. As to the latter category of physicians, the ALJ barred their testimony based on the additional reason that Respondents had not “timely identif[ied] by name the proposed witnesses,” as again required by his Prehearing Order.
Id.
at 4. And the ALJ further barred Respondents from offering the testimony of “any pharmacists referred to but not identified in [their] prehearing statements.”
Id.

The ALJ also granted the Government's motion to exclude the testimony of Mssrs. Badawi and Crowley. As for Mr. Badawi, the ALJ found that Respondent had not complied with his Prehearing Order because “[u]nlike the articulation of specific red flags provided by the Government in its description of testimony for its expert, the Respondents' Prehearing Statements do not reveal the substance of this testimony, but instead presented only a list of areas to be discussed.”
Id.
at 5. As for Respondents' representation that Mr. Badawi would also testify about errors he identified “in the inventory performed by the DEA,” the ALJ found that Respondents failed to “articulat[e]

the nature of these errors” and there was “[in]sufficient information regarding the timeframe used by Mr. Badawi to permit a determination that the testimony would be relevant.”
Id.

As for Mr. Crowley's proposed testimony regarding errors in the DEA audit, the ALJ found that Respondents “fail[ed] to articulate what those errors were.”
Id.
And as for his proposed testimony “regarding procedures used by the pharmacies for resolving red flags and for complying with DEA recordkeeping requirements,” the ALJ explained that he could not “discern from the summary of [his] testimony whether [it] concerns the practices of the pharmacies at the time of the execution of the administrative warrants, at times before then, or at the present time.”
Id.
at 5-6. Finding that Respondents had “failed to comply with the prehearing order[s]” and had also “failed to establish that [his] proposed testimony would be relevant,” the ALJ barred Mr. Crowley's testimony.
Id.
at 6.

The ALJ also addressed the Government's contention that Respondents' documentary evidence should be excluded. In his Order, the ALJ explained that in his Prehearing Orders he had directed the parties to exchange their exhibits on or before January 12, 2015, and that the “failure to timely do so would result in the exclusion of the documents.”
Id.
at 4. According to the ALJ, “[o]n both January 9 and . . . 12, a representative of Mr. Sisco's office contacted a member of my staff, inquiring whether Respondents [could] submit documents by using electronic files; . . . on both occasions my staff member advised that only hard copies and facsimiles would be accepted.”
Id.
The ALJ explained that on January 12, he directed his staff to return the flash drives which Respondents' counsel had sent to his office, and that as of the date of the hearing, Respondents still had not filed their proposed exhibits with his office.
Id.
at 4-5. The ALJ then explained that he had “considered the Government's report of the contents of what presumably was on” the flash drives, as well as Respondents' explanation as set forth in their Responses to the Government's Motions, and found that good cause existed to grant the motions and bar Respondents from introducing their proposed exhibits.
Id.
at 5. The ALJ, however, provided Respondents' counsel with the opportunity to submit its proposed exhibits as a proffer, provided it did so no later than February 10, 2015, and provided his Office with an original and two copies, as well as a copy to the Government.
Id.

Subsequently, on February 3, 2015, the Government filed a “Notice of Objections to Respondent's Exhibits.” ALJ Ex. 15 (Nos. 15-6 and 15-17). Therein, the Government noted that it had received eight binders of evidence totaling nearly 4,300 pages, of which five binders appeared to be related to Superior I and three binders Superior II.
Id.
at 2. While the Government contended that it was unclear whether the Respondents were offering the exhibits as a proffer or as evidence to be admitted in the proceeding, it then explained that even if the exhibits were offered as a proffer, they should not be included in the record because Respondent had not made an offer of proof as required by 21 CFR 1316.60.
Id.
The Government further noted that none of the documents were “self-authenticating” and many of them, which included patient medical records, “appear to come from sources other than the Respondents.”
Id.
at 3.

At the first day of the evidentiary phase of the hearing, the ALJ addressed the Government's objection. Tr. 54. After re-affirming his earlier ruling which barred Respondents from introducing any documentary evidence, the ALJ then turned to the Government's contention that Respondents had not complied with 21 CFR 1316.60. On the issue of whether Respondents had made an adequate offer of proof, the ALJ asked one of Respondents' counsel if he was “correct in understanding that the Respondent[s'] Pre-hearing Statements and the premises that [he] articulated during the initial day of hearing in support of receiving these exhibits should, taken together, be regarded as containing the statement of the substance of the evidence which you would have accompany the excluded documents?” Tr. 58. Respondents' counsel answered “[y]es.”
Id.
While the ALJ had also noted that “an offer of proof shall be part of the record only if a proper foundation has been laid for its admission,”
id.
at 57, the ALJ did not ask Respondents' counsel to lay a foundation for any of the exhibits.
Id.
at 57-69. After noting that he received only a single copy of the proffered exhibits (vice the three copies required by his Prehearing Order), the ALJ ordered Respondents to provide two additional copies of the proffered exhibits prior to 5 p.m. that day; he further advised that if the copies were not filed, he would return the proffered exhibits to Respondents.
Id.
at 69. Subsequently, Respondents filed the additional copies of the exhibits, and the exhibits were forwarded as a proffer.

The ALJ's Ruling on Respondents' Subpoena Requests

During the January 27 hearing, the ALJ also addressed each Respondent's request for subpoenas. Tr. 17-23. As explained above, each Respondent submitted requests for an extensive number of subpoenas but failed to include with its requests a certificate of service establishing that they had provided copies to the Government.

Asked by the ALJ to address its requests, Respondents' counsel asserted that “the request for subpoenas was copied to [Government counsel] timely as to each of the subpoenas.”
Id.
at 18. However, when asked by the ALJ if it was correct that he did not include a certificate of service, Respondents' counsel answered: “If the Court says that that wasn't included then I'll accept that. However, I will represent that everything that I provided to the Court has been provided to” Government counsel.
Id.
at 20. The ALJ then asked the Government's counsel if he had been provided with copies of the subpoena requests.
Id.
at 21. Government counsel answered that he had received a thumb drive which “contains so many thousands of pages of documents” that he “did not look for specific subpoenas.”
Id.
Subsequently, Respondents' counsel confirmed that he had sent the subpoena requests to the Government electronically.
Id.
at 22.

The ALJ then explained that in his Prehearing Orders, he had advised the parties that subpoena requests that did not comply with his instructions would be returned without further action; he also explained that Respondents had neither objected to nor sought clarification of the Prehearing Orders.
Id.
at 23. Finding that Respondents had not complied with his Prehearing Orders, the ALJ announced that he would be returning Respondents' subpoena requests without further action.
Id.
The ALJ did not address whether Respondents had made an adequate showing as to relevancy with respect to either the patients or the physicians.
Id.
at 17-23.

Respondents' Motions for a Daubert Hearing and To Exclude the Testimony of the Government's Expert

On January 15, 2015, Respondents also filed motions to exclude the testimony of the Government's pharmacy expert Robert Parrado. ALJ Ex. 41 (No. 15-6); ALJ Ex. 41 (No. 15-7). The basis of Respondents' motions was that “Mr. Parrado's proposed opinions are based on nothing more than a cursory review of the written prescriptions to the exclusion of all

other information,” and that he “did not apply any reliable methodology as mandated” by
Daubert
v.
Merrell Dow Pharmaceuticals, Inc.,
509 U.S. 579 (1993), and its progeny. ALJ Ex. 41, at 2 (No. 15-6); ALJ Ex. 41, at 2 (No. 15-7). Respondents also argued that Mr. Parrado was “not qualified to render any opinions regarding whether the physician issuing the prescriptions did so for a legitimate medical purpose in the usual course of professional practice.” ALJ Ex. 41, at 2 (No. 15-6); ALJ Ex. 41, at 2 (No. 15-7) (both citing Fla. Stat. 766.102(5) (“person may not give expert testimony concerning the prevailing professional standard of care unless the person is a health care provider who holds an active and valid license and conducts a complete review of the pertinent medical records”).

Respondents argued that the ALJ was required to perform a “gatekeeping” function in determining whether Mr. Parrado's testimony was admissible. ALJ Ex. 41, at 2 (No. 15-6); ALJ Ex. 41, at 2 (No. 15-7). They further argued that under
Daubert,
the Government was required to show that: (1) Mr. Parrado was qualified to testify as an expert; (2) that he used a sufficiently reliable methodology in reaching his conclusions; and (3) that his testimony would assist the trier of fact. ALJ Ex. 41, at 2 (No. 15-6); ALJ Ex. 41, at 2 (No. 15-7). Respondents then suggested that under
Daubert,
the ALJ was required to consider “whether the theory or technique” used by Mr. Parrado “has been subject to peer review and publication.” ALJ Ex. 41, at 4 (No. 15-6); ALJ Ex. 41, at 4 (No. 15-7). According to Respondents, Mr. Parrado's testimony should be excluded as unreliable because “he failed to conduct a thorough investigation and failed to base his proposed opinion on any reliable methodology.” ALJ Ex. 41, at 5(No. 15-6); ALJ Ex. 41, at 5 (No. 15-7).

The Government opposed the motions. Quoting agency precedent, the Government argued that where, as here, non-scientific expert testimony is at issue, the expert's “ `knowledge and experience' ” may provide a sufficient foundation for concluding that his testimony is reliable. ALJ Ex. 50, at 3 (quoting
Holiday CVS, L.L.C., d/b/a CVS Pharmacy No. 219 and 5195,
77 FR 63316, 62334 (2012) (quoting
Surles ex rel. Johnson
v.
Greyhound Lines, Inc.,
474 F.3d 288, 295 (6th Cir. 2007))). The Government noted that Mr. Parrado has been a licensed pharmacist for more than 40 years and had been “the recipient of numerous professional appointments.”
Id.
The Government further argued that at the hearing, Respondents would “have ample opportunity to question [him] regarding his knowledge and experience, but . . . to exclude him on that basis, prior to trial, is both misguided and premature.” ALJ Ex. 50, at 4. The Government also argued that Respondents provided no support for their contention that Mr. Parrado's testimony should be excluded because “he did not interview [the] patients or other persons.” ALJ Ex. 50, at 4.

The ALJ denied Respondents' motions. The ALJ reasoned that in each Show Cause Order and its Prehearing Statements, “the Government identifie[d] red flags or other conditions which, according to the Government, triggered a corresponding obligation on the part of pharmacies who were presented with a number of prescriptions. The thrust of this evidence is [not] dependent upon scientific or technical analysis, but upon documentary or testimonial evidence establishing or rebutting the claimed corresponding obligation.” ALJ Ex. 7, at 7 (Nos. 15-6 and 15-7).

The ALJ then held that “[t]he Government ha[d] made a sufficient showing to permit Mr. Parrado to appear and give testimony.”
Id.
Continuing, the ALJ explained that at the hearing, he would allow Respondents to question Mr. Parrado as to his qualifications and the methodology he used, but that he was not making a “preclusive ruling prior to the time [he] testified.”
Id.
The ALJ thus denied Respondents' motions to either conduct a separate hearing on the admissibility of Mr. Parrado's testimony or to exclude his testimony prior to the hearing.
Id.

Respondents' Motions for a Continuance

On January 15, 2015, each Respondent also moved for a continuance. ALJ Ex. 42 (No. 15-6); ALJ Ex. 42 (No. 15-7). Respondents sought a continuance of the proceeding “to commence no sooner than June 2015.”
See, e.g.,
ALJ Ex. 42, at 5 (No. 15-6). Respondents asserted that they needed the continuance “to interview and subpoena witnesses,” and that they “ha[d] timely requested the issuance of numerous subpoenas and . . . ha[d] exercised due diligence in this regard.”
Id.
at 3. Respondents further asserted that “[d]ue to the short time period between the issuance of the order[s] to show cause and the commencement of the hearing, and the numerous potential witnesses, [they] will undoubtedly be prejudiced by a [sic] the lack of time to adequately interview and obtain service on the necessary witnesses.”
Id.

Respondents argued that “the Government has had years to prepare its case whereas [they have] only been afforded a few months.”
Id.
at 4. Continuing, Respondents contended that the Government “has had more than 20 months to process and analyze the seized information,” and that “[d]uring this time, the information was not available to Respondent.”
Id.
at 5. While Respondents then acknowledged that “a portion of the seized information, most notably the prescriptions, was provided to [them] in electronic format,” they then contended that “the sheer volume of information coupled with the unreasonably short deadlines surrounding the holiday season makes analysis of the information . . . impossible.”
Id.

On January 27, 2015 (during the initial day of the hearing), the ALJ denied Respondents' motions.
10

In so ruling, the ALJ relied on his previous ruling that Respondents had “failed to timely submit their request for subpoenas.” Tr. 30. The ALJ then explained that he could not “reconcile” Respondents' assertion that they needed more time to prepare with the representations made in each of their Prehearing Statements that their two proposed experts had “reviewed the prescriptions at issue, the relevant inventory and ordering history and prepared summaries of the pharmacies' dispensing activities during 2011 and 2012.” Tr. 31;
see also
ALJ Ex. 9, at 5-6 (No. 15-6); ALJ Ex. 12, at 5-6 (No. 15-7).
11

Finally, the ALJ explained that he had:

10
The Government did not file a response to this motion.

11
As found above, in their Prehearing Statements, Respondents represented that Mr. Badawi would testify about “the procedures used at Superior Pharmacy [I and II] to consider and resolve alleged `red flags,' inventory, ordering and CSOS compliance issues. Mr. Badawi will further testify that he has reviewed the prescriptions at issue, the relevant inventory and ordering records and prepared summaries of the prescription dispensing activity at Superior Pharmacy [I and II] during 2011 and 2012, and identified significant errors in the inventory performed by the DEA.” ALJ Ex. 9, at 6 (No. 15-6); ALJ Ex. 12, at 6 (No. 15-7).

Likewise, Respondents represented that “Mr. Crowley will testify regarding errors in the audits performed by the agent/investigators of Superior Pharmacy [I and II]. Mr. Crowley reviewed the prescriptions, inventory and CSOS records of Superior Pharmacy [I and II]. Mr. Crowley will further testify regarding Superior Pharmacy[I and II]'s procedure for resolving potential `red flag' issues and compliance with recordkeeping requirements related to inventory records, DEA-222 order forms and CSOS issues.” ALJ Ex. 9, at 5 (No. 15-6); ALJ Ex. 12, at 5 (No. 15-7).

consider[ed] a variety of factors, including the diligence and good faith of the parties seeking the continuance; the grounds for the delay; fairness to both parties; the need for orderly administration of justice; the length

of the delay requested; whether other continuances have been requested and received; the inconvenience to litigants, witnesses, opposing counsel and the Court; and whether the requesting party contributed to the circumstances which give rise to the request for a continuance and any other relevant factors depending on the facts of the case.

Tr. 31. The ALJ then found that “cause has not been shown to delay this hearing” and denied the Respondents' motions.
Id.

With the evidentiary phase of the hearing set to begin on February 10, 2015, on February 6, 2015, Respondents filed a second Motion for Continuance. ALJ Ex. 12, at 1 (No. 15-6/15-7). The basis for the motion was that on January 28, 2015, they had retained a third counsel, who previously been involved in resolving a matter involving another of Mr. Obi's pharmacies.
Id.
at 2. Citing “the complexity of the issues in these matters,” Respondents sought a continuance of three weeks to allow its additional counsel to prepare for the hearing.
Id.

The same day, the Government objected. ALJ Ex. 19 (Nos. 15-6/15-7). It argued that Respondents had been aware of the allegations since October 16 and 17, 2014, and that “neither Respondent has been without counsel since” they were served with the Show Cause Orders, and that Superior I had previously retained an additional counsel.
Id.
at 3. The Government further asserted that it was “both disingenuous and . . . legal gamesmanship to suggest that the eleventh hour appearance of a co-counsel for Superior II and a second co-counsel for Superior I constitute grounds for disrupting a proceeding that” in its view had commenced on January 27, 2015.
Id.
It then argued that Respondents had not demonstrated any hardship that justified a continuance and they “ha[d] never
timely
objected to any” of the dates set by the ALJ, “including the date and location of the hearing which” had been set “more than two months” earlier.
Id.
at 4. Finally, the Government stated that it was prepared to put on its case and that “all of [its] witnesses are travelling to Arlington, Virginia, and have set aside time to participate in this matter.”
Id.
The Government thus argued that “any further delay” would cause it prejudice.
Id.

The ALJ denied Respondents' motion. ALJ Ex. 24, at 2 (Nos. 15-6/15-7). As with Respondents' previous motions for a continuance, the ALJ explained that he had considered various factors and found that “cause has not been shown to delay the hearing.”
Id.

The Evidentiary Hearing and ALJ Decision

On February 10 and 11, the ALJ conducted the evidentiary phase of the hearing at the DEA Hearing Facility in Arlington, Virginia. At the hearing, the Government elicited the testimony of four witnesses, including its expert witness, Mr. Robert Parrado; the Government also introduced various documents into evidence. Consistent with the ALJ's order granting the Government's Motions
in Limine,
Respondents were precluded from calling any witnesses and introducing any documentary evidence. The ALJ did, however, allow Respondent to submit ten binders of documents (totaling nearly 4,300 pages) as a proffer.

Following the hearing, both parties submitted briefs containing proposed findings of fact and conclusions of law (hereinafter, referred to as Post-Hearing Brief). On April 9, 2015, the ALJ issued his Recommended Decision (hereinafter, cited as R.D.); according to the Certificate of Service, on April 10, the ALJ's law clerk sent a copy of the Decision to all three of Respondents' counsels by Federal Express.

In the Recommended Decision, the ALJ relied on the Government's evidence with respect to factors two and four to conclude that “the Government has established its
prima facie
case by at least a preponderance of the evidence that Respondents' continued . . . registrations would be inconsistent with the public interest.” R.D. 87. Further finding that “Respondents have failed to rebut that case through a demonstration of sufficient remediation,” the ALJ recommended that I revoke each Respondent's registration and deny any pending applications to renew or modify its registration.
Id.

On May 4, 2015, the ALJ transmitted the record to my Office. On May 6, 2015, Respondents filed a brief captioned as: Exceptions to the Recommended Decision and Request for Removal of the ALJ (hereinafter, cited as Resp.' Exceptions). Respondents, however, offered no showing of good cause to excuse the untimely filing of their brief.
See generally id.
In response, on May 7, 2015, the Government filed with my Office a motion to strike Respondents' Exceptions as untimely or, in the alternative, to respond to their Exceptions.
See
Gov. Motion to Supplement the Record, Strike Respondent[s'] Untimely Filed Exceptions to the Recommended Decision of the Administrative Law Judge Or, In the Alternative, Respond to Exceptions. Because Respondents have not demonstrated good cause to excuse the untimely filing of their Exceptions, I consider the claims raised therein only if they were previously raised in their Post-Hearing Brief.

Having carefully considered the entire record in this matter and, in particular, the claims of error raised by Respondents in their Post-hearing Brief, I do not adopt the ALJ's findings of fact and conclusions of law with respect to the allegations that each Respondent's pharmacists violated 21 CFR 1306.04(a) and 1306.05(a). I do, however, adopt the ALJ's findings of fact and legal conclusions with respect to: (1) The allegations pertaining to the audits conducted of each pharmacy, (2) the allegations that Respondents were not properly maintaining required records including their schedule II order forms, and (3) that for purchases made using the electronic Controlled Substance Order System, Superior II was not electronically linking its receipt records to its purchase records. I further find that Respondent Superior II violated DEA regulations by allowing a non-authorized person to place electronic orders using the key assigned to an authorized person. I therefore conclude that the Government has made out a
prima facie
case to support revocation of Respondents' registrations. And because Respondents have produced no evidence of any corrective measures they have undertaken, I will order that their registrations be revoked and that any pending applications be denied. As ultimate fact finder, I make the following.

Findings of Fact

The parties stipulated that Respondent Superior I holds DEA Certificate of Registration BS9255274, pursuant to which it is authorized to dispense controlled substances in schedules II through V as a retail pharmacy, at the registered address of 3007 W. Cypress St., Suite 1, Tampa, Florida. ALJ Ex. 7, at 2 (Nos. 15-6/15-7).

The parties stipulated that Respondent Superior II holds DEA Certificate of Registration BS9699731, pursuant to which it is authorized to dispense controlled substances in schedules II through V as a retail pharmacy, at the registered address of 5416 Town `N' Country Blvd., Tampa, Florida.
Id.

The DEA Investigation

On February 4, 2013, DEA Investigators executed Administrative Inspection Warrants at Respondents Superior I and Superior II. Tr. 370-71; 471. With respect to Superior I, the Investigators seized the original

prescriptions for its schedule II and III dispensings, as well as its schedule II order forms (DEA-Form 222), invoices, and inventory records.
Id.
at 372. At Superior I, a DEA Investigator (who assisted the lead Investigator) also conducted an inventory of the controlled substances then on hand with the assistance of the pharmacist on duty, who verified the count; the Investigator also obtained a copy of an inventory taken by Superior I which was dated May 2, 2011.
Id.
at 373-78. According to a DI, because the May 2, 2011 inventory “did not include all the drugs that were a part of the audit,” he asked the lead Investigator to contact the pharmacy for additional inventory records, and on February 11, 2013, Superior I provided additional records which included a “bi-annual inventory” and an “in-house inventory.”
Id.
at 378-79.

Likewise, with respect to Superior II, the lead Investigator on the warrant testified that she seized the original schedule II prescriptions and the pharmacy's purchasing records for the drugs that were subject of the audit; the DI also testified she obtained the pharmacy's schedule II order forms as well as a perpetual inventory maintained by the pharmacy which was dated July 31, 2012.
Id.
at 472, 474, 477. The DI also took an inventory of the controlled substances then on hand, with the DI witnessing Superior II's pharmacist counting of the pills.
Id.
at 477.

As part of the investigations, the Government provided various schedule II prescriptions which were dispensed by each pharmacy to its expert Mr. Robert Parrado, who reviewed them to determine if they were dispensed in compliance with the Controlled Substances Act. Mr. Parrado testified that he obtained his B.S. in Pharmacy in 1970 from the University of Florida College of Pharmacy and that he has held a Florida pharmacist's license since 1971. Tr. 122; GX 2, at 1 (No. 15-6/15-7). Mr. Parrado testified that he has practiced as a pharmacist at both community pharmacies as well as hospital pharmacies; he also testified that he had been the Pharmacy Department Manager at multiple pharmacies, including two pharmacies that he owned for approximately 19 years. Tr. 124-26; GX 2, at 1-2.

Mr. Parrado was a member of the Florida Board of Pharmacy from January 2001 through February 2009, and had served as both Vice Chairman and Chairman of the Board. Tr. 128-29; GX 2, at 3. He is a member of the Florida Pharmacy Association, having served as both its President and then Chairman of the Board. GX 2, at 3. He is also a member of the Hillsborough County Alcohol & Drug Abuse Task Force, the National Community Pharmacists Association, and the American Society for Pharmacy Law.
Id.
Finally, he has made numerous presentations on the dispensing of controlled substances by pharmacists,
id.
at 3-7, and has testified as an expert witness for both the prosecution and defense in criminal and administrative matters. Tr. 133;
see also id.
at 152 (answering “no” when asked on
voir dire
if, in criminal matters, he has always testified for the Government).

Asked to explain what the standard of care (in Florida) requires of a pharmacist who is presented with a prescription for a controlled substance, Mr. Parrado testified:

You have to ensure that the prescription is appropriate and that it's valid. And in doing that he has to look at the prescription. He has to understand the nature of the drug, the nature of the disease state that they're treating, the appropriateness of the therapy and the dosing.

And then make sure that the prescription was issued under . . . the valid circumstances of a physician . . . having written the prescription in the course of his practice and that the prescription is . . . for [a] legitimate medical purpose.

Id.
at 137.

Asked to explain what a “red flag” is as it relates to the dispensing of controlled substances, Mr. Parrado then testified that:

[a] red flag is anything that will cause the pharmacist concern as to the validity of that prescription. It could be numerous things.

And a lot of times it's just dependent on the patient presenting the prescriptions or the circumstances. Or just looking at the prescription itself might raise a red flag . . . and cause you concern.

Id.
at 138.

Mr. Parrado then proceeded to identify various red flags, including if the prescription was for “a known drug of abuse” and if the dosing is “appropriate.”
12

Id.
Continuing, Mr. Parrado explained that after “mak[ing] sure the dosing is appropriate . . . you look at the quantity of tablets” and ask if it is “an appropriate therapy for the condition . . . [t]hat the physician is treating.”
Id.
at 139. Mr. Parrado then testified that he looks at what he termed the “triangle”—the locations of “the patient['s] home, the physician's office and the pharmacy” and that “whenever one of those legs seems to get a little bit long I seem to get a little concerned,” thus leading him to “want to verify why a person would drive a long way to [go] to a particular clinic” and why the person would “drive a long way from that clinic to a pharmacy.”
Id.
at 140.

12
At this point, Respondents' counsel objected on the ground that the testimony was “outside the scope of the” Government's Prehearing Statements. Tr. 138. However, in its Prehearing Statements, the Government notified Respondents that Mr. Parrado would identify and discuss “prescriptions for controlled substances which are known to be highly abused” and “prescriptions for quantities of narcotics that exceeded the recommended daily dosages.” ALJ Ex. 6, at 3 (No. 15-6); ALJ Ex. 7, at 3 (No. 15-7). I thus find that the ALJ properly overruled the objection.

Mr. Parrado also identified other red flags to include “[m]ultiple people presenting with identical or very similar prescriptions from the same clinic,” as well as where a person presents prescriptions for “cocktails that are known to be abused on the street.”
Id.
Mr. Parrado then explained that a cocktail “is a combination of drugs,” which usually includes an “opioid such as oxycodone or hydromorphone,” “a benzodiazepine such as Xanax or Valium,” and “a muscle relaxant such as Soma.”
Id.
at 140-41.

Mr. Parrado further identified as a red flag the circumstance where multiple persons present the “same prescriptions” from either “the same practitioner” or “clinic.”
Id.
at 141. Mr. Parrado then explained that multiple persons getting the same prescriptions “from the same clinic” would be a red flag because “there's supposed to be an individualization of therapy whenever a physician is ordering a pain medication.”
13

Id.
Of similar import, Mr. Parrado testified that he was familiar with the term “pattern prescribing,” which he explained was when “prescriptions com[e] from the same clinic in . . . the same drug,” with the same or “very similar” dosing and quantities.
Id.
at 142. Reaffirming his earlier testimony, Mr. Parrado explained while “there could be a small difference” in the quantity (
i.e.,
168 vs. 180 pills) prescribed, “[t]hat doesn't

show me that there's any attempt at individualization of therapy.”
Id.

13
Here again, Respondents objected to the testimony, asserting that it was “outside the scope of [Mr. Parrado's] testimony” and that Mr. Parrado was not “qualified to testify about what the standard of care is for . . . a healthcare practitioner” under Florida Statute § 766.102. Tr. 141-42. Of note, in its Prehearing Statements, the Government disclosed to Respondents that Mr. Parrado would discuss “prescriptions issued to multiple individuals presenting prescriptions for the same drugs in the same quantities from the same doctor.” ALJ Ex. 6, at 3 (No. 15-6); ALJ Ex. 7, at 3 (No. 15-7). The ALJ overruled the objection. Tr. 142. Respondent did not, however, explain how it was prejudiced because the Government then asked whether a red flag was also presented because the prescriptions came from the same clinic. As for Respondent's contention that Mr. Parrado was not qualified under the Florida Statute to render an opinion on the issue, Florida law does not control the scope of permissible testimony in this proceeding.

Mr. Parrado then identified two more red flags. The first of these is when “two people in the same household or [with the] same address were needing the exact same drugs.”
Id.
at 143. While Mr. Parrado explained that this could possibly be legitimate, the “onus of verifying that prescription has been seriously moved up a notch.”
Id.
Mr. Parrado then testified that a red flag is also raised when prescriptions are issued to multiple persons with the same last name.
Id.

Asked by the Government what steps a pharmacist should take upon being presented with a prescription that raises a red flag, Mr. Parrado explained:

At that point the pharmacist—first thing he has to do, he has to verify that prescription with the prescriber. Florida law says you check with the prescriber.

Not the prescriber's office, with the prescriber. And then you speak with the prescriber and get his opinion.

You ask him the questions that you feel, you know, address your concerns. And then at that point I have to . . . use my professional judgment. Did I believe him or not.

Because a physician who had written a script is always going to say, yes they wrote it. But I'm trying to determine if it was written for a legitimate medical purpose. So that's why I'm asking the questions I'm asking.

Id.
at 144.

Continuing, the Government asked Mr. Parrado if some red flags are unresolvable, prompting objections by each Respondent that this testimony was beyond the scope of the summary of the testimony disclosed by the Government in its Prehearing Statements.
Id.
at 144-45. The ALJ overruled the objections
14

and Mr. Parrado testified:

14
This was the first of several objections to the Government's elicitation of testimony from its Expert as to whether some of prescriptions presented red flags that could not be resolved. As Respondents argued, the Government Pre-hearing Statements “do [ ] not anywhere discuss irresolvable red flags. And this is a last minute attempt to prejudice the ability of the Respondent[s] to put on a case here.” Tr. 144.

One of the fundamental tenets of Due Process is that the Agency must provide a respondent with notice of those acts which the Agency intends to rely on in seeking the revocation of its registration so as to provide a full and fair opportunity to challenge the factual and legal basis for the Agency's action.
See NLRB
v.
I.W.G., Inc.,
144 F.3d 685, 688-89 (10th Cir. 1998);
Pergament United Sales, Inc., v. NLRB,
920 F.2d 130, 134 (2d Cir. 1990).
See also
5 U.S.C. 554(b) (“Persons entitled to notice of an agency hearing shall be timely informed of . . . the matters of fact and law asserted.”).

However, “ `[p]leadings in administrative proceedings are not judged by the standards applied to an indictment at common law.' ”
Citizens State Bank of Marshfield
v.
FDIC,
751 F.2d 209, 213 (8th Cir. 1984) (quoting
Aloha Airlines
v.
Civil Aeronautics Bd.,
598 F.2d 250, 262 (D.C. Cir. 1979)).
See also Boston Carrier, Inc.
v.
ICC,
746 F.2d 1555, 1560 (D.C. Cir. 1984) (quoted in
Edmund Chein,
72 FR 6580, 6592 n.21 (2007) (“an agency is not required `to give every [Respondent] a complete bill of particulars as to every allegation that [he] will confront”). Thus, the failure of the Government to disclose an allegation in the Order to Show Cause is not dispositive, and an issue can be litigated if the Government otherwise timely notifies a respondent of its intent to litigate the issue.

The Agency has thus recognized that “the parameters of the hearing are determined by the prehearing statements.”
Darrell Risner, D.M.D.,
61 FR 728, 730 (1996). Accordingly, in
Risner,
the Agency held that where the Government has failed to disclose “in its prehearing statements or indicate at any time prior to the hearing” that an issue will be litigated, the issue cannot be the basis for a sanction. 61 FR at 730.
See also Nicholas A. Sychak, d/b/a Medicap Pharmacy,
65 FR 75959, 75961 (2000) (noting that the function of prehearing statements is to provide Due Process through “adequate . . . disclosure of the issues and evidence to be submitted in . . . proceedings”);
cf. John Stafford Noell,
59 FR 47359, 47361 (1994) (holding that notice was adequate where allegations were not included in the Order to Show Cause but “were set forth in the Government's Prehearing Statement”).

However, consistent with numerous court decisions, the Agency has also held that even where an allegation was not raised in either the show cause order or the prehearing statements, the parties may nonetheless litigate an issue by consent.
Pergament United Sales,
920 F.2d at 135-37;
see also Duane
v.
Department of Defense,
275 F.3d 988, 995 (10th Cir. 2002) (discussing
Facet Enterprises, Inc.,

v. NLRB,
907 F.2d 963, 974 (10th Cir. 1990); “we held that defendant had constructive notice of an alternate theory of liability not described in the formal charge when the agency detailed that theory during its opening argument and at other points during the hearing and when the defendant's conduct revealed that it understood and attempted to defend against that theory”).
See also Grider Drug #1 & Grider Drug #2,
77 FR 44070, 44077 n.23 (2012) (holding that while the Government did not provide adequate notice of its intent to litigate an allegation in either the show cause order or its prehearing statements, where respondents “did not object that the allegation was beyond the scope of the proceeding and that they were denied adequate notice of it” and “fully litigated the issue,” the allegation was litigated by consent) (citing
Citizens State Bank,
751 F.2d at 213;
Kuhn
v.
Civil Aeronautics Bd.,
183 F.2d 839, 841-42 (D.C. Cir. 1950); and
Yellow Freight System, Inc.,
v.
Martin,
954 F.2d 353, 358 (6th Cir. 1992)).

Here, I conclude that the ALJ erred when he overruled Respondents' objections to the testimony, as neither the Show Cause Orders, nor the Government's Prehearing Statements ever identified any prescription as presenting red flags that could not be resolved. As the Second Circuit has explained, “[t]he primary function of notice is to afford [a] respondent an opportunity to prepare a defense by investigating the basis of the complaint and fashioning an explanation that refutes the charge of unlawful behavior.”
Pergament United Sales,
920 F.2d at 135 (citation omitted). The defense of the allegation that a prescription presented red flags that could not be resolved requires entirely different proof,
i.e.,
testimony as to why a prescription did not lack a legitimate medical purpose, than the defense of the allegation that a pharmacist failed to resolve red flags, and Respondents' multiple objections make clear that they did not consent to the litigation of the issue. Accordingly, the Expert's testimony to this effect cannot be considered in determining whether Respondents' pharmacists violated their corresponding responsibility under 21 CFR 1306.4(a).

Well anytime that there is a red flag my job is to resolve that red flag. And at that point I'm having to use my professional judgment when I'm weighing all the different factors that are causing me concern.

If I cannot resolve all these things that are bothering me, at that point that becomes unresolvable and I cannot fill that prescription.

Id.
at 145-46.
See also id.
at 361 (agreeing that a pharmacist's education, experience and training inform his/her professional judgment).

The Government then asked Mr. Parrado if a retail pharmacist would document his/her resolution of a red flag “somewhere?”
Id.
at 146. Mr. Parrado answered: “Absolutely. Anytime you have a concern with appropriateness of therapy, you always do what you have to do to resolve it and then you document it on the prescription.”
Id.
Asked by the Government if the resolution of a red flag “would be documented on the prescription itself,” Mr. Parrado answered: “Yes. Unless you have another form of doing that I don't know about, but the standard of practice has always been you document it on the prescription.”
Id.

On Respondent's
voir dire,
Mr. Parrado was asked whether “the manner in which a pharmacist documents their [sic] efforts to resolve red flags is not mandated by any statute, regulations or guidance document?”
Id.
at 154. Mr. Parrado answered: “The pharmacist has a duty to verify that's done. And when he's done that he needs to document it. Because if you haven't documented it you haven't done it.”
Id.
Upon further questioning by Respondents, Mr. Parrado acknowledged that neither the Florida Statutes nor the Florida Administrative Code state where the pharmacist has to document his/her resolution of a red flag.
Id.
at 156.

On further
voir dire
by Respondents, Mr. Parrado testified that his opinions were not based on conversations he had with the pharmacists at Respondents, or any statements of the pharmacists provided to him by DEA.
Id.
at 158. He also testified that his opinions were not based on any statements made by the patients, or the prescribers.
Id.
at 158-

59.
15

Over Respondents' objections,
16

Mr. Parrado was accepted as an expert.
Id.
at 165.

15
Regarding whether his opinions were based on the presentations on red flags made by the former head of the Agency's Office of Diversion Control, Mr. Parrado acknowledged that he has seen these presentations on two occasions. Tr. 159. However, Mr. Parrado stated that the presentations “reinforced” his existing opinions on red flags.
Id.
at 160. As for the presentations he had previously given, Mr. Parrado acknowledged that he no longer considers a patient's asking for a drug by brand name to be a red flag.
Id.
at 161-62.

When asked whether his opinions were based on information in the DEA
Pharmacist's Manual,
Mr. Parrado answered “yes”, and when asked if he disagreed with anything in the
Manual
as it relates to red flags and their resolution, answered “no.”
Id.
at 163.

16
The basis of Respondents' objection to Mr. Parrado being accepted as an expert was that he “is a practicing pharmacist. He's experienced in retail pharmacy but qualification as an expert, there's no need.” Tr. 165. Given Mr. Parrado's extensive years of practice as a retail pharmacist; his years as a member of the Florida Board of Pharmacy, which includes service as both Vice Chairman and Chairman; his involvement in the Florida Pharmacy Association which includes his service in leadership positions; his membership in other professional associations; and his numerous presentations; the ALJ properly overruled Respondents' objection.

Mr. Parrado then testified that he was retained to “review the prescriptions.”
Id.
at 166. He also acknowledged having “reviewed some patient records” and “a patient profile,” before clarifying that “the main thing [he] relied on was the prescriptions and those partial patient records.”
17

Id.

17
On cross-examination, Mr. Parrado testified that he had review only one patient profile “a couple of weeks” before the hearing. Tr. 232.

The Superior I Prescriptions

The Government then proceeded to question Mr. Parrado regarding the 25 prescriptions contained in Government Exhibit 3 (No. 15-6).
Id.
at 167. Each of the prescriptions was issued by a physician at the 24th Century Medical Center, which, according to the prescriptions, was located at 7747 W. Hillsborough Avenue in Tampa. GX 3. Sixteen of the prescriptions were issued on August 5, 2011 for oxycodone 30 and were filled by Superior I on the same day.
See id.
at 1-16; Tr. 169. Moreover, 13 of these 16 prescriptions were written by the same physician (Dr. C.), with the remaining three written by another physician (Dr. R.). GX 3, at 1-16.

Each page of this exhibit contains two images; one showing the front of the prescriptions; the other showing the back.
See generally
GX 3. With respect to the first page of the exhibit, Mr. Parrado testified that the bottom image was the back of the prescription. Tr. 169. He explained that when a pharmacy fills a prescription, its computer generates labels, one of which goes on the prescription bottle and the other goes on the prescription.
Id.
Mr. Parrado then explained that the number following the letters “RX” on the label was the prescription number and that the number is generated sequentially by the pharmacy's “computer as prescriptions are being filled.”
Id.
at 170-71. However, Mr. Parrado subsequently testified that “[d]epending on the computer format they have, some will generate a number with the first number being different . . . depending on the schedule of the drug.”
Id.
at 174.

The Government then asked Mr. Parrado whether there were “any red flags associated with” the 16 prescriptions, which were filled on August 5, 2011.
Id.
at 178. Mr. Parrado testified that the prescriptions presented multiple red flags:

Well first thing I would see was the drug, [o]xycodone, 30 milligrams. Then I would see that they're all coming from the same clinic. They're all for the same strength written by the same physician on the same day.

So there's multiple patients coming from the same clinic. Which was one of my concerns earlier. Multiple people presenting from the same clinic with a like or similar prescription.

These are definitely alike in similar prescriptions. So that would be my first red flag.

Then the next red flag I would have looked at was the dosing. The appropriateness of therapy. A red flag I would have to resolve at this point was knowing that 80 milligrams a day of [o]xycodone is a lethal dose to an opioid naïve patient. These are much higher than 80 milligrams a day dosing.

I would have to verify—I'd have to feel good about the fact that the patient had been on this drug therapy and established to this dose. Would have been the first thing.

Then the next thing I would have looked at would have been the patient[']s address. How far he drove to get there.

Then another thing I would have looked at was what . . . did he pay for it with cash. And how much did he pay. How much is he willing to pay for.
18

18
At this point, Mr. Parrado testified that “in that time period,” oxycodone cost from $.33 to $1.00 per tablet, at which point Respondents' counsel objected to the testimony, asserting that it was outside the scope of the Government's Prehearing Statements and that there was no foundation for Mr. Parrado's testimony. Tr. 179. While the Government's Prehearing Statement did not disclose the precise prices he testified to, the Government did disclose that Mr. Parrado would “identify and discuss . . . prescriptions for individuals playing [sic] high prices . . . for controlled substances with cash.” ALJ Ex. 6, at 3 (No. 15-6). Moreover, the label attached to the back of each of the prescriptions contains data as to both the price to the patient and the cost of the prescription and the prescriptions were provided to Respondents prior to the hearing. The labels suggest that Mr. Parrado's testimony as to the cost per tablet was accurate.
See, e.g., generally
GX 3 (No. 15-6).

As to the issue of foundation, Mr. Parrado testified that “I know the pharmacy I was working in at that time [was] paying about $.33 a pill for [o]xycodone.” Tr. 182. He then added that the average price charged to a patient “may have gotten to a $1.00.”
Id.
On cross-examination, Mr. Parrado further testified that his knowledge of pricing was not based on his having called individual pharmacies, but rather his “general knowledge of what the market place was.” Tr. 242.

Id.
at 178-79.

Mr. Parrado further testified that each of the 16 prescriptions was paid for in cash.
Id.
at 181. Asked whether based on his experience and knowledge of retail pharmacy practice, the prices being charged by Respondent for these prescriptions “were considered high prices for oxycodone,” Mr. Parrado answered “[v]ery.”
Id.
at 182. Mr. Parrado subsequently explained that “these prices are very, very high” and that this would be an additional red flag.
Id.
at 183. As the evidence shows, 13 of the patients paid $784 or more for their prescriptions, and five of the patients paid $952 or more. GX 3, at 1-16.

The Government then questioned Mr. Parrado regarding the red flags presented by the relative location of the patients to the prescriber and Superior I. With respect to the prescriptions reproduced at pages one (112 oxycodone 30 to M.L.) and nine (224 oxycodone 30 to V.P.), both patients' addresses were listed as being in Spring Hill, Florida.
19

See id.
at 1, 9. According to Mr. Parrado, Spring Hill is located 45 to 50 miles from Superior I.
20

Tr. 185. Mr. Parrado then explained that “[t]here

are many pharmacies between Spring Hill and Tampa.”
Id.

19

See also
GX 3, at 2 (Rx for 160 oxycodone 30 to J.R.).

20
Here again, Respondents objected to Mr. Parrado's testimony, arguing that the Government's Prehearing Statement did not disclose that he was “going to be offering testimony with regard to the distances between locations or the relative locations of these patients and the pharmacy.” Tr. 184. Respondents further argued that they had “prepared to cross examine the person who [the Government] said would testify to that. It was the intelligence analyst. It is not Mr. Parrado.”
Id.

It is correct that the Government did not disclose in its Prehearing Statement for Superior I that Mr. Parrado would specifically testify about the distances between Superior I and the towns of Spring Hill (as well as New Port Richey and others). It also true that in its Prehearing Statement, the Government indicated that it intended to call a different witness (an intelligence analyst) to testify about a chart she created showing the large number of Superior I's patients who lived long distances from the pharmacy. However, the Government also disclosed that it intended to ask the ALJ to take official notice of the approximate mileage between Superior I and the various municipalities where the patients lived. Moreover, the distances between Superior I and the towns of Spring Hill and New Port Richey are disputable only to the extent one argues over the precise addresses used to ascertain that distance or the route taken. I thus conclude that Respondent cannot show how it was prejudiced by the ALJ's overruling of its objection.

Regarding the prescriptions reproduced at page four (168 oxycodone 30 S.M.) and 16 (224 oxycodone 30 for S.A.), Mr. Parrado testified that both patients gave addresses in New Port Richey.
Id.
He then testified that New Port Richey is “[a]bout 40 miles north of Tampa.”
Id.
Mr. Parrado then noted that patient addresses for other prescriptions included Bradenton (40-45 miles south and west of Tampa),
id.
at 186; Port Richey (which is next to New Port Richey),
id.
at 187; Ocala (90-100 miles north of Tampa),
id.
at 188; Gainesville (130 miles north of Tampa),
id.;
High Springs (“probably a 150 miles” from Tampa),
id.
at 188-89; Jacksonville (200 miles north and east of Tampa),
id.
at 189-90; Alachua (140-150 miles from Tampa);
id.
at 190; Middleburg (“[c]lose to Jacksonville” and “about 200 miles” from Tampa);
id.
at 191; and Uvalda, Georgia (“probably . . . close to 300 miles” from Tampa).
Id.
at 192.

Next, the Mr. Parrado testified that each of the 16 prescriptions was “facially invalid” because the prescribing physician did not include the patient's address.
Id.
Mr. Parrado explained that under Florida law “at the time
21

. . . the patient name and address had to be on the front of the prescription.”
Id.
While Mr. Parrado testified that a missing address is a red flag, he acknowledged that the pharmacist could resolve it by adding in the patient's address.
Id.
Asked by the Government whether it appeared that Superior I's pharmacists had resolved this red flag with respect to the prescriptions reproduced at pages one and four of GX 3, Mr. Parrado acknowledged that it appeared that they had done so as evidenced by the “computer generated sticker[s] that the pharmacist[s] put” on the prescriptions.
Id.
at 193. However, Mr. Parrado then explained that it “would have been [the pharmacist's] duty” to verify that the address on the sticker “was accurate.”
Id.

21
While Mr. Parrado referred to Florida law “at the time,” Florida law still requires that the face of a controlled substance prescription contain “[t]he full name and address of the person for whom . . . the controlled substance is dispensed.” Fla. Sta. § 893.04(c)(1)(2015).

The Government then asked Mr. Parrado about the prescriptions found at pages 11 (RX#452161), 12 (RX#452160), 14 (RX#452156), 15 (RX#452155), and 16 (RX#452159). Tr. 194-95. Of note, these prescriptions were issued to patients who reported their addresses respectively as being in High Springs, Alachua, Middleburg, Florida; Uvalda, Georgia; and New Port Richey, Florida.
See
GX 3, at 11-12, 14-16. Specifically, the Government asked whether “the fact that these numbers are so close together, looking at these prescriptions collectively, does that raise any additional red flags for you?” Tr. 195. After the ALJ overruled Respondent's objection that the testimony was outside the scope of the Prehearing Statement, Mr. Parrado answered:

Yes. Yes, it would have caught my attention that we had people coming from long distances and places that were close together, coming to get these prescriptions.

What I don't see on there is, you know, it looks like the [patient address] sticker was put on the front to resolve the red flag. It doesn't tell me how they resolved the red flag.

Id.

The Government then asked Mr. Parrado about the prescriptions reproduced at pages 13 (RX#452157) and 14 (RX#452156); these prescriptions listed the patient's addresses as being in Jacksonville (J.M.) and Middleburg, Florida (B.M.).
Id.
at 196; GX 3, at 13-14. According to Mr. Parrado, these “two prescriptions were filled sequentially for people from Middleburg and Jacksonville, which are both very close to each other.” Tr. 196. Continuing, Mr. Parrado opined: “So they could have travelled together to come there.”
22

Id.
Mr. Parrado further observed that these patients had the same last name.
Id.
at 197.

22
Here again, Respondent objected to the testimony as “rank speculation” for which there was “no foundation.” Tr. 196. He also argued that it was beyond scope of the Government's Prehearing Statement.
Id.
The ALJ overruled the objection.

As for Respondent's objection on the ground that the testimony was “rank speculation,” given that Mr. Parrado testified and the prescriptions show that: (1) These two patients had the same last name, (2) provided addresses which suggested that they lived near each other, and (3) their prescriptions bore sequential prescription numbers, Mr. Parrado's testimony was a permissible inference. In any event, even if the patients did not travel together, each of these prescriptions presented red flags.

Moreover, even acknowledging that the Government did not disclose that Mr. Parrado would testify that these two persons could have travelled to Superior together, the Government nonetheless disclosed that it intended to elicit testimony regarding Respondent's filling of multiple prescriptions for patients who travelled long distances to obtain their prescriptions. ALJ Ex. 1, at 2-3 (No. 15-6); ALJ Ex 7, at 3-5 (No. 15-6).
See also supra
note 12 (collecting cases).

Next, the Government asked Mr. Parrado about the prescriptions reproduced at pages 14 and 15. Of note, the latter prescription was issued to a patient (C.M.), who provided an address in Uvalda, Georgia and who has the same last name as that of the patients discussed in the preceding paragraph.
See
GX 3, at 15. Mr. Parrado again opined that he believed these persons travelled together to obtain the prescriptions. Tr. 198. Asked by the Government—over the overruled objection of Respondent—whether the red flags presented by these were resolvable, Mr. Parrado explained:

These are the kinds of prescriptions that would cause me not to be able to resolve that—this many red flags together. The long distance, the same name, the like, similar drugs, thousands of dollars involved here, in cash, would cause me . . . concern.

It's not, in my practice, it's not been—the average customer doesn't come into the pharmacy with $1,000 in their pocket. You know, it's average you tell the person they have a $20 copay they get upset.

For these process [sic] to be charged, you know, it's just—that's a red flag that I would have a hard time resolving.
23

23
Here too, Respondent objected that Mr. Parrado “ha[d] no idea what people who come into a pharmacy have in their pocket or they don't.” Tr. 199-200. Respondent thus contended that Mr. Parrado's testimony was speculation and was outside the scope of the Prehearing Statement.
Id.
at 200. The ALJ stated that he noted the objection and that he did not need Respondent to tell him “what should be or should not be allowed in this hearing.”
Id.
The ALJ then explained that he had made his ruling and instructed the Government to ask its next question.
Id.

I agree with Respondent that this testimony was speculative because the patients could well have paid for their prescriptions with credit cards. However, the prescriptions list their respective prices as $833 (RX 452157), $952 (RX452156), and $833 (RX452155). GX3, at 13-15. Regardless of the method of payment used to purchase them, Mr. Parrado testified that the cost of the prescriptions was also a red flag.

Id.
at 199. Asked the same question with respect to the prescriptions reproduced at pages 13 and 14, Mr. Parrado testified: “It would be the same answer. It's the same situation.”
24

Id.
at 200.

24
This prompted the same objection by Respondent and the same ruling. Tr. 200.

The Government then asked Mr. Parrado whether, with respect to the 16 oxycodone 30 prescriptions (GX 3, at 1-16), which were issued and filled on August 5, 2011, there was any evidence, other than the placement of the address stickers, that the red flags they presented “were resolved?” Tr. 200. Mr. Parrado testified: “[t]here is no documentation to that effect on any of these prescriptions.”
Id.
Following up, the Government asked Mr. Parrado if he had seen any evidence “that any of the red flags [other than the missing addresses] were even investigated?”
Id.
at 201. Mr. Parrado replied:

In some of the partial medical records I looked at, there wasn't any evidence of any conversations between the clinics and the

pharmacist.
25

Also, this is one of the things I got out of the partial medical records, that there wasn't any evidence that they had even talked with the pharmacy. And there was nothing here being documented either.

25
On cross-examination, Mr. Parrado testified that he had been given the partial medical records after the New Year's holiday. Tr. 357-58.

Id.

Mr. Parrado then opined that it “would be outside the standard of care for a pharmacist to fill these without having resolved the red flags before dispensing.”
Id.
Asked to opine on whether, based on the prescriptions and records he reviewed, the pharmacists “exercise[d] their corresponding responsibility to ensure that a prescription for a controlled substance was issued for [a] legitimate medical purpose,” Mr. Parrado answered: “[n]ot that I can tell from the records shown to me.”
Id.
at 201-02.

The Government then questioned Mr. Parrado about the remaining prescriptions in its Exhibit 3. These included a prescription for 240 oxycodone 30 issued on December 10, 2011 to J.M.; as with the other prescriptions, the prescriber had not written the patient's address on the prescription but the prescription contained a small sticker listing J.M.'s address as Lenoir, Tennessee. GX 3, at 22 (No. 15-6). Asked if the prescription raised any red flags, Mr. Parrado noted J.M.'s address and explained that his “first concern” was the “person coming from Tennessee.” Tr. 202. Mr. Parrado identified additional red flags presented by the prescriptions, including the physician's failure to include the patient address on the prescription, that the quantity of 240 pills was a “very high dose” for oxycodone 30, that the prescription came “from the same clinic,” and that it cost $1,155.
Id.
Mr. Parrado then explained that “[t]hose are all red flags that I could not have resolved.”
Id.

However, when asked by the Government if he could tell who filled the prescription, Mr. Parrado testified that the prescription bore the initials “CD,” thus indicating “the pharmacist responsible” for the script; he then added that “there's a scribble on the front from somebody that canceled the prescription.”
Id.
at 203. Moreover, the prescription has two diagonal lines drawn through it, along with a circle with the letter “C” in bold, and while there is a copy of the dispensing label attached to the back,
see
GX 3, at 22, the Government offered no further evidence to clarify whether the prescription was actually dispensed.

Next, the Government asked Mr. Parrado whether the prescriptions (reproduced at GX 3, at 17-18), which are dated August 6, 2011 and bear sequential prescription numbers presented any red flags. Both of these prescriptions were issued by Dr. S.A.H., a physician at the same 24th Century Medical Center in Tampa, to two persons (E.P. and R.B.) for 150 and 140 tablets respectively of oxycodone 30. GX 3, at 17-18. Here too, the front of each prescription lacked the patient's address.
See id.
However, each prescription bore a sticker listing the patient's address, and the stickers indicated that E.P. and R.B. lived at the same street address in Milton, Florida.
See id.

Asked by the Government whether the prescriptions presented any red flags, Mr. Parrado identified the patients' addresses and added that “Milton, Florida is way in the [w]estern panhandle of Florida. It's well over 400 miles” to the pharmacy. Tr. 204.
26

Mr. Parrado noted that “both of them seem to have the same address.”
Id.
However, he then testified that the driver's license that was in R.B.'s “partial medical records” listed his address as being in a different city (Pace, Florida) than Milton.
Id.
at 205. Mr. Parrado explained that the disparity between the address on the prescription and the address on the driver's license “caused me concern that they weren't looking very closely.”
Id.
at 205-06.

26
Respondent's counsel objected that the testimony was outside the scope of the Government's Prehearing Statement and was rank speculation. Tr. 204-5. The ALJ overruled the objection.
Id.
at 205. Here again, the Show Cause Order specifically alleged that “[o]n August 6, 2011, one or more Superior I pharmacists dispensed large and substantially similar quantities of thirty milligram tablets of oxycodone to two customers, E.P. and R.B., both of whom resided at the same address in Milton, Florida, which is located approximately four hundred and forty nine miles (449) from Superior I's location.” ALJ Ex. 1, at 2 (No. 15-6). While this alone provided adequate notice, the Government's Prehearing Statement further advised that “Mr. Parrado will further testify that, on August 6, 2011, Respondent dispensed large quantities of thirty milligram oxycodone to two individuals, E.P. and R.B., who resided at the same address in a city located more than 440 miles . . . from Respondent's pharmacy.” ALJ EX. 7, at 4 (No. 15-6). The ALJ thus properly overruled the objection.

After noting that E.P.'s prescription cost $562 and R.B.'s prescription cost $525, Mr. Parrado testified that “two people from one address paying over $1,000 would be a red flag from somebody coming . . . from 400 miles away.”
Id.
at 206. He further noted that both prescriptions were written by the same physician and were for the same drug and in essentially the same quantities.
Id.
Mr. Parrado then testified that he had seen “no documentation anywhere” that Superior I's pharmacist resolved the red flags, including in the “partial medical records,” which contained “no evidence that there was any conversation between the pharmacy and the physician['s] office.”
Id.
at 206-07.

Next, the Government asked Mr. Parrado about a prescription issued by Dr. V.S. (also of the 24th Century Medical Center) and dispensed on December 2, 2011 to B.W., for 200 tablets of Dilaudid (hydromorphone) 8 mg.
See
GX 3, at 21; Tr. 207. Here again, the prescription lacked the handwritten patient's address but contained a sticker which listed B.W.'s address as being in Fort Ogden, Florida. GX 3, at 21.

Asked if the prescription presented any red flags, Mr. Parrado testified that there were multiple red flags, including that “it's a very, very potent drug” and that the quantity was for 200 pills. Tr. 208. Continuing, Mr. Parrado testified that:

I have never seen a prescription in my 41 years as a pharmacist for a quantity like that of . . . Dilaudid 8 milligrams as being dosed at every . . . three to four hours.

Which would be six to eight times a day. So 48 to 72 milligrams . . . would be the daily dose for a drug that the recommended upper dose be probably 24 milligrams.

So it's a much higher dose then [sic] what I have ever seen as a pharmacist. And that would have caused me serious concern that I had to resolve before I could do anything, period.

The fact that they came a long way, again, from Fort Ogden, from that same clinic that I'm seeing all these prescriptions from, would cause me not to be able to resolve that red flag.

Id.
at 208-09.

Mr. Parrado was then asked whether a prescription (GX 3, at 19) for 196 Dilaudid 8 mg issued by Dr. P.C. and dispensed on December 1, 2011 to R.L. (Largo, Fl.) also presented red flags. Tr. 209. Mr. Parrado testified that the quantity and dosing raised the “exact same concern” as the dosing was “well outside the recommended upper dosage of that drug.”
Id.
Continuing, he explained: “And I don't see anything where that was resolved to establish that the patient had developed a tolerance to that drug to avoid the respiratory depression that would have been inherent at that dose.”
Id.

Asked whether R.L.'s address in Largo was also a red flag (here too, the patient's address had not been written on the prescription but had been added by a sticker), Mr. Parrado testified that the distance was 20 to 25 miles.
Id.
at 209-10. While he acknowledged that this was not “a very long distance,” he

explained that “the fact that there's so many coming from outside the area just starts compounding the fact that this is almost . . . like a destination clinic or destination pharmacy where people know to go there.”
Id.
at 210. Mr. Parrado then testified that he found no evidence that Superior I's pharmacist attempted to resolve the red flags.

As for the prescription (GX 3, at 20), which was issued by Dr. R. (also of 24th Century) to C.L. for 224 Dilaudid 8 mg on December 1, 2011 and filled the same day, Mr. Parrado again found the quantity to be a red flag, testifying that this would be “a lethal dose to an opioid naïve patient.” Tr. 211. He then explained that “there's nothing here to show that the patient has developed a tolerance to this drug.”
Id.
27

As for the prescription (GX 3, at 23), which was issued by Dr. V.S. (of the same clinic) to M.A. for 224 Dilaudid 8 mg on December 2, 2011 and filled the same day, Mr. Parrado testified that the “very high dose” was a red flag and that there was no evidence that the patient had developed tolerance to the drug. Tr. 212.

27
In response to the Government's question whether the fact that these two prescriptions were presented the same day raised “[a]ny additional red flags,” Mr. Parrado testified that “[t]hat's another pattern prescribing red flag. To me.” Tr. 211-12. I conclude, however, that two prescriptions do not establish pattern prescribing.

Concluding its direct examination

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A2016-11550. Public record. Not legal advice.