Pharmacies and pharmacists have been targeted as the next prime suspects in the continuing saga of the opioid epidemic. In the wake of the federal government’s recent $8.34 billion opioid settlement with Purdue Pharma LP, law enforcement’s focus appears to be shifting from pharmaceutical manufacturers and distributors to pharmacies and pharmacists.  Individual pharmacists, neighborhood pharmacies, and large retail pharmacy operators alike face a myriad of legal issues related to their filling of opioid prescriptions (or their decision not to fill in certain circumstances), from civil defamation lawsuits by physicians, to complaints by State Boards of Pharmacy, to other civil and criminal demands. In particular, the Department of Justice (“DOJ”) and its associated Drug Enforcement Agency (“DEA”) have begun to flex the apparent strength granted to them under the Federal Controlled Substances Act (“CSA”) and False Claims Act (“FCA”) against the pharmacy industry. 

These demands under the CSA and FCA primarily arise from a pharmacy’s filling opioid prescriptions that exhibit signs of being prescribed without a legitimate medical purpose, i.e., the prescriptions allegedly display “red flags.” The demands from the DOJ and DEA force a pharmacist or pharmacy to second-guess or otherwise improperly substitute their own medical judgment over the professional medical opinion of a physician (who is otherwise registered with the DEA to prescribe opioids); however, the DEA and DOJ have offered little practical advice or guidance on what constitutes a “red flag,” and what “red flags” are sufficient to require that the prescription be refused. Furthermore, identification of these “red flags” is nowhere to be found in the statutory scheme of the CSA or FCA. Meanwhile, patients with serious medical conditions could be left untreated.

These issues have been brought front and center in a bold and novel declaratory judgment action filed days ago by Walmart, Inc. in the Eastern District of Texas, Walmart Inc. v. U.S. Department of Justice, et al. As that lawsuit alleges, these demands have very little, if any, foundation in the subject regulations enforced by the DOJ and DEA (i.e., many of the red flags were identified in non-binding materials such as DEA slideshow presentations, and not explicitly promulgated in the statutory language being enforced). Moreover, the DEA has routinely failed to revoke the controlled substance registrations of many physicians whose prescriptions display these “red flags,” thereby passing the DEA’s job of policing problematic prescribers, and ultimately the DEA’s regulatory enforcement responsibilities, onto pharmacies. The lawsuit presents a Herculean challenge to DOJ and DEA enforcement actions directed to pharmacists and pharmacies addressing purported failures to identify and take action with respect to these alleged prescription “red flags” and which seek onerous financial penalties.

The attorneys with Lashly & Bear’s Health Care Advisory Team have experience representing pharmacies, pharmacists, and health care providers in these complex matters. This includes a team approach to handling regulatory, compliance, licensure, risk management, and health care litigation, We understand the issues and the complex interactions that pharmacies and pharmacists face from the various governmental agencies. Our attorneys are available to assist clients facing all types of governmental investigation. 

The complaint in the Walmart case can be found HERE. 

Who to Contact:

Please reach out to your Lashly & Baer attorney or one of the members of the Health Care Advisory Team if you have any questions about this information. 

Prepared by:

Michael R. Barth
Phone: 314-436-8382
Email: mbarth@lashlybaer.com

Matthew J. Eddy
Phone: 314-436-8355
Email: meddy@lashlybaer.com

Richard W. Hill, III
Phone: 314-436-8317
Email: rhill@lashlybaer.com

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