Handcuffs and usa dollar banknotes on wooden background. More of my photos and videos Adobe Stock:http://bit.ly/3RqlciK More of my photos and videos Shutterstock: https://www.shutterstock.com/g/ALEKSANDRBERDYUGIN My email: bermix999@gmail.com
Bermix Studio, Unsplash
Listen to this post

On January 13, 2026, the United States Department of Justice (DOJ) announced that Atlantic Biologicals Corporation, a Miami-based pharmaceutical distributor, paid a $450,000 criminal penalty and entered into a two-year deferred prosecution agreement.  The settlement resolves the government’s allegations that from 2017 through May 2023, the company, through its business unit NAS, engaged in the illegal distribution of millions of dosage units of controlled substances to Houston-area pharmacies.

DOJ’s press release includes a laundry list of compliance failures and red flags missed by the company, such as:

  • Charging “pill mills” a higher price for controlled substances and the customers’ willingness to pay “well-over-market” prices for controlled and non-controlled substances;
  • Circumventing or ignoring purported compliance measures to increase sales of controlled substances;  
  • Distributing only those drugs and drug formulations that are commonly abused or diverted;
  • “Ordering non-controlled drugs in suspicious patterns, including almost always ordering large quantities and limited varieties in exactly the quantities necessary to meet their NAS-imposed ordering ratio;”
  • Customers located in strip mall with nothing for sale in customer areas.

Several individuals were also prosecuted as part of this investigation.  They include the former President of NAS, Joshua Weinstein, an independent sales representative, Derrick Atkinson, and the owner of a third-party consultant company, Jason Smith, among others.  These individuals previously pled guilty to conspiracy to unlawfully distribute and dispense, and possess with intent to distribute controlled substances.

This case is noteworthy for a few reasons. 

First, it highlights the notion that compliance is everyone’s responsibility and the government will (and should) hold accountable anyone who is involved in the illegal distribution of controlled substances.  Sales/Business leadership and/or individual sales representatives are not immune from prosecution.  This is especially true if they intentionally circumvent compliance requirements to sell controlled substances, or otherwise implement “business” requirements that undermine the company’s compliance obligations.   

In my travels I have come across secondary controlled substance distributors who primarily utilize ratios, wherein they require customers to purchase a specific volume of non-controlled substances and/or generic drugs, in exchange for the ability to purchase a set volume of controlled substances.   Establishing a customer’s controlled substance purchasing authority is a complex process that must take into consideration several data points, including the customer’s business model, size, and geographic location, among other things.  While the use of ratios is not a per se violation of the CSA, the Atlantic Biologicals/NAS case is a cautionary tale for companies that rely on ratios as the primary tool for managing controlled substance orders.