DEA settles $50 million penalty with LTC pharmacy provider

Federal agencies have fined an LTC provider $50 million for improperly dispensing controlled substances.

Authorized prescribers

Drug Enforcement Administration (DEA) regulations have been vague with respect to the dispensing of controlled substances on instructions from LTC facility staff after they have consulted with an authorized prescriber.


In addition, while DEA does not oppose the use of a reminder letter containing a blank prescription template for emergency use as well as for expiring orders, DEA has taken the position that LTC pharmacies are not permitted to provide an authorized prescriber a prescription template that has been completed in whole or in part by the pharmacy.

Claims and responsibilities

The DEA is affirming that the civil settlement highlights the responsibilities of pharmacists, physicians, and others when prescribing or dispensing controlled substances. The settlement resolves civil penalty claims made by the DOJ against the pharmacy that it violated the Controlled Substances Act for an extended period.

The claims against the pharmacy included:

"Emergency" exception

DEA's October 2010 guidance described under what circumstances a nurse can act as an agent of an authorized prescriber when transmitting a prescription to an LTC pharmacy.

DEA's position is that unless a pharmacy is able to follow that guidance, LTC pharmacies are prohibited from dispensing controlled substances without a valid prescription signed by a physician ordering the medication.

An exception would be limited "emergency" circumstances, where applicable law and regulations provide a special procedure for a prescribing practitioner to call in an oral prescription for Schedule II controlled substances directly to the pharmacy, followed up within a week by a signed written prescription.

DEA alleged that the LTC pharmacy has routinely accepted facility medical chart orders, oral orders from facility staff, and other substitute documents and procedures as bases to dispense controlled substances, instead of requiring signed prescriptions or oral prescriptions directly from the prescribing physician.

The bottom line

Under the terms of the agreement, payment of $50 million to the Office of the United States Attorney for the Northern District of Ohio was required.

The DEA, in turn, agreed to refrain from instituting, directing, or maintaining any administrative action, including denial, suspension, or revocation of the pharmacy's DEA registration.

This article is not intended as legal advice and should not be used as such. When legal questions arise, pharmacists should consult with attorneys familiar with relevant drug and pharmacy laws.

Ned Milenkovich is a member at McDonald Hopkins, LLC, and chairs its drug and pharmacy practice group. He is also Vice-Chairman of the Illinois State Board of Pharmacy. Contact Ned at 312-642-1480 or at