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The feds are throwing the book at NECC. Here are some of the details.
In December 2014, the United States Attorney’s Office charged 14 New England Compounding Center (NECC) employees, among them the owner and seven other pharmacists, with crimes that included murder, racketeering, and mail fraud. The charges stem from the NECC’s compounding and distribution of thousands of doses of contaminated injectable steroid medications that were ultimately linked to a fungal meningitis outbreak, first reported in 2012, that resulted in 76 patient deaths and 778 cases of illness.
The federal government has also seized $18.3 million held in various bank accounts associated with the company's principals.
Racketeering and murder
The NECC pharmacy executives face a 131-count indictment, including 25 counts of second-degree murder. Although the requirements for second-degree murder charges vary by state, second-degree murder generally requires willful or extreme disregard for life or awareness that such wrongful conduct would cause death.
The indictment also lists 78 acts of racketeering, in which the defendants shipped the drugs interstate as part of a scheme to defraud their customers and the patients of those customers by making materially false representations of compliance with Massachusetts pharmacy laws. For instance, one pharmacy technician had voluntarily surrendered his Massachusetts license in a disciplinary action a year before he was employed by NECC.
The NECC sold its compounded drugs through a sales force and marketing materials that asserted the pharmacy’s compliance with USP-797’s standards for sterile compounded drugs. However, the indictment demonstrates multiple instances of noncompliance with USP-797.
For example, company pharmacists did not verify the effectiveness of NECC’s sterilization process and routinely attempted to sterilize drug lots in the autoclave for approximately five minutes less than the minimum time stipulated by USP-797.
The sales force also provided quality assurance report cards with false environmental monitoring results. In reality, the NECC had actionable environmental deficiencies but did not remediate the issues.
The NECC’s high-risk compounding business allegedly used nonsterile ingredients to make sterile drugs. According to the indictment, the pharmacy used expired and expiring ingredients, created fake expiration dates, mixed lots to conceal expiring or untested lots, and changed lot numbers. If the company received a notification from an independent laboratory that a drug was nonsterile, the NECC did not notify its customers or recall the drugs.
NECC employees also falsified cleaning records and sent samples from stock solutions for sterility testing, as opposed to filled vials of drugs.
Conspiracy to defraud
The indictment also charges the defendants with conspiracy to defraud the United States for their role in operating as a drug manufacturer distributing compounded drugs in bulk, rather than a state-regulated pharmacy dispensing drugs pursuant to valid, patient-specific prescriptions. As a drug manufacturer, the pharmacy would fall under the Food and Drug Administration’s (FDA) regulatory oversight.
On three occasions, the NECC told the FDA that it compounded only patient-specific prescriptions. However, the NECC permitted specific customers to provide it with fake patient names or the names of a previous month’s patients. The pharmacy executives reused names, and created fake prescriptions based on the names of celebrities, medical staff, and fictional characters, including Wonder Woman, Filet O’fish, Bill Clinton, and Bud Weiser.
The NECC also regularly waived the requirement for patient-specific prescriptions for its customer’s first orders. The NECC not only shipped drugs without patient names; it told its sales force to tell customers that it would not include patient-specific names on the drug labels.
Executives at the highest levels were involved; the NECC’s national sales director warned the sales force in an e-mail not to use words such as “backfill” when discussing the need to provide patient names for orders.
The extensive descriptions of the NECC’s actions in the indictment serve as a warning to compounding pharmacies that fail to follow sterile compounding standards and perform bulk dispensing of compounded drugs without patient-specific prescriptions.
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 the relevant drug and pharmacy laws.
Ned Milenkovichis a principal at Much Shelist and vice chair of the Illinois State Board of Pharmacy. Contact him at 312-521-2482 or at firstname.lastname@example.org.