As required by the “SUPPORT for Patients and Communities Act” (Public Law 115-217), DEA just announced that it has implemented a new tool to provide drug manufacturers and distributors with access to anonymized ARCOS information.

This an enhancement to DEA’s existing tool that previously provided very limited ARCOS information.  The new functionality in the tool “will allow DEA-registered manufacturers and distributors to view and download the number of distributors and the amount (anonymized data in both grams and dosage units) each distributor sold to a prospective customer in the last available six months of data.”

DEA’s expectation is that the tool will be used to assist registrants with detecting and reporting suspicious orders and to fulfill their “know your customer” obligations.  As an example, DEA indicates “if a query resulted in a large number of suppliers who have recently sold unusual quantities of opioid analgesics to a prospective purchaser, this may represent a “red flag” to the new distributor and foster a dialogue between that distributor and the pharmacy.”

On February 21, 2019, the Drug Enforcement Administration (DEA) published a Notice of Proposed Rulemaking (NPRM), New Single-Sheet Format for U.S. Official Order Form for Schedule I and II Controlled Substances (DEA Form 222).  This is the agency’s second attempt at bringing the DEA Form 222 into the 21st Century.  In 2007, the agency issued a similar NPRM, but never published a Final Rule.

The current NPRM not only changes the format of the 222, but also proposes “minor procedural changes.”  Below is a summary of some of those changes.

Continue Reading DEA Issues Notice of Proposed Rulemaking for New 222 Form

After a brief hiatus, DEA Chronicles is back. As always, I will be keeping you informed on changes in the relevant laws and regulations and how these may impact your business. But, as regular readers know, we go beyond simple reporting. DEA Chronicles identifies DEA enforcement trends. We engage in policy analysis across the spectrum of issues involving controlled substances. What regulatory approaches best combine an effective strategy for combating diversion with a workable framework for the various actors in the pharmaceutical industry? What are the best practices designed to ensure compliance? What are the red flags that should alert companies to potential problems within their organizations? We explore these and all other questions regarding the enforcement of controlled substance laws and regulations.

Cote Law PLLC

So why the hiatus? The answer is simple and, for me at least, kind of exciting. After six and a half years with Quarles & Brady, I am pleased to announce that I have moved the DEA Litigation and Compliance practice to my new firm, Cote Law PLLC. I bring to my DEA practice a unique set of experience and skills. For one, I worked at DEA at a management level in the enforcement area. I know my way around the agency. I know how it operates and how it thinks. It is one thing to read a statute or a regulation. It is another to understand how the people at the agency approach the enforcement of these laws. 

Continue Reading Did You Miss Me?

The Department of Justice recently published its list of proposed regulatory actions for the near and long term.  It appears that the Drug Enforcement Administration’s (DEA’s) Regulatory Drafting and Support Section is going to have a busy year.  The Unified Agenda indicates several potential regulatory changes are in store for the coming year, some of which may have significant impact on the regulated community.

A few highlights:

  • Updates to the suspicious order regulation have been delayed to at least February 2019.
  • DEA will provide guidance for Emergency Medical Services wishing to handle controlled substances.
  • After more than nine years, DEA is finally implementing regulations regarding the practice of telemedicine, as required by Congress in the Ryan Haight Act.
  • Guidance is forthcoming regarding the partial filling of prescriptions for Schedule II controlled substances as a result of related provisions in the Comprehensive Addiction and Recovery Act (CARA) of 2016.
  • It appears that additional (and significant changes) will be coming to DEA’s quota process.
  • DEA is getting rid of the carbon copy 222 form! (for those too young to understand the concept of carbon copies, click here)

Below are links to each notification and a summary taken directly from the related Abstract.

Stay tuned. We will provide updates as they become available.

Continue Reading DEA to Propose Significant Regulatory Changes in the Coming Year

In a joint statement by the U.S. Department of Justice and the Drug Enforcement Administration, the government announced continued efforts to tackle the opioid crisis by reducing the quantity of controlled substances permitted to be manufactured next year. The proposal decreases the 2019 Aggregate Production Quotas (APQ) for six of the most frequently misused opioids by an average of ten percent compared to 2018 quotas. The proposed production quotas for the six opioids will cut the 2018 quotas from 7% to 15% in 2019. The proposal seeks to advance the effort taken by President Trump’s “Safe Prescribing Plan,” which aims to “cut nationwide opioid prescription fills by one-third within three years.” The six drugs addressed by this action are oxycodone, hydrocodone, oxymorphone, hydromorphone, morphine, and fentanyl.

It appears that the percentage reduction of quota for these six drugs was not based on diversion statistics compiled by DEA and the Notice does not otherwise provide specific justification for the reduction in quota.  In the joint statement, the government indicated that the goal of the reduction is to “encourage vigilance on the part of opioid manufacturers, help DEA respond to the changing drug threat environment, and protect the American people from potential addictive drugs while ensuring that the country has enough opioids for legitimate medical, scientific, research, and industrial needs.”

This marks the third straight year that the DEA has proposed such APQ reductions for controlled substance manufacturing in the U.S., a trend that does not appear to be slowing down. In addition to the government’s stated goals, it will be interesting to see whether continued quota reductions impact the root cause of the ongoing epidemic – the over-prescribing of controlled substances.

Over a period of two weeks in June, the House passed several bills aimed at combating the ongoing opioid epidemic. Our summary of the earlier measures can be found here. Key points of these additional legislative initiatives are summarized below. We will continue to monitor and report on their progress.

R. 3192, CHIP Mental Health Parity Act
This bill required state Children’s Health Insurance Program (CHIP programs) to cover mental health benefits including substance use disorder services for pregnant women and children. It also prohibits states from imposing financial or utilization limits on mental health treatment that are lower than the limits placed on physical health treatment.

R. 3331
Specifically, this bill encourages the Center for Medicare and Medicaid Innovation to test models to provide incentive payments to behavioral health providers for adopting electronic health records technology, and using that technology to improve the quality and coordination of care.

Continue Reading House Opioid Measure Frenzy Continues

On Tuesday, the House of Representatives passed a fleet of bills aimed at combating the ongoing opioid crisis, most aimed at developing preventative measures to curb opioid addiction by funding research. The measures passed with overwhelming bipartisan support. Key points of these legislative initiatives are summarized below. Quarles & Brady will continue to monitor their progress.

Continue Reading House Passes 12 Bills Aimed at Combating Opioid Crisis

A United States District Court Judge issued a temporary restraining order prohibiting the Drug Enforcement Administration (DEA) from enforcing the Immediate Suspension Order issued against Morris & Dickson.

Acknowledging, that the entire administrative record was not before the court, Judge Foote nonetheless held that “Plaintiff has demonstrated a substantial likelihood that it will be able to prove that the Acting Administrator’s finding is arbitrary and capricious” and that “Morris & Dickson faces a substantial threat of irreparable harm if the immediate suspension of DEA Certificates of Registration Nos. RM0314790 and RM0335732 is not enjoined and that the balance of equities and the public interest favor granting a temporary restraining order.”

A preliminary injunction hearing is currently scheduled for May 22.

On May 2, 2018, the DEA issued an Order to Show Cause and Immediate Suspension of Registration (the “Order”) against Morris & Dickson Co., LLC (“M&D”), a drug distributor based in Louisiana with pharmacy customers in 7 states. The DEA has two main allegations against M&D:

  1. M&D failed to maintain effective controls against division of controlled substances into other than legitimate channels, in violation of 21 USC 823(b)(1) and 21 CFR 1301.71.
  2. M&D failed to identify and report suspicious orders to DEA, in violation of 21 CFR 1301.74(b).

Continue Reading Alleged Failure to Report Suspicious Orders Leads to Suspension

On April 19, 2018, the Drug Enforcement Administration (DEA) issued a Notice of Proposed Rule Making (NPRM) proposing various changes to DEA’s process for setting Aggregate Production Quotas (APQ) and Individual Procurement Quotas (IPQ). Here are some of the more significant “changes” proposed in the NPRM:

Aggregate Production Quotas

  • DEA must consider the diversion of a particular class of drugs when setting APQ;
  • DEA must also consider information from HHS, FDA, CDC, CMA, and state information when setting APQ;
  • DEA must consider diversion as one of the factors for adjusting APQ;
  • Allows for a hearing, if requested, and necessary to resolve issues related to a state’s objection to changes in APQ.

Continue Reading DEA Proposes Changes to Quota Regulations