[Federal Register Volume 64, Number 7 (Tuesday, January 12, 1999)]
[Notices]
[Pages 1823-1825]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-557]


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DEPARTMENT OF JUSTICE

Drug Enforcement Administration
[Docket No. 98-29]


Bill Lloyd Drug; Revocation of Registration

    On April 17, 1998, the Deputy Assistant Administrator, Office of 
Diversion Control, Drug Enforcement Administration (DEA), issued an 
Order to Show Cause to Bill Lloyd Drug (Respondent) of Graham, Texas, 
notifying it of an opportunity to show cause as to why DEA should not 
revoke its DEA Certificate of Registration AB2243246, and deny any 
pending applications for renewal of such registration as a retail 
pharmacy pursuant to 21 U.S.C. 824(a)(4) and 823(f) for reason that its 
continued registration would be inconsistent with the public interest.
    By letter dated May 15, 1998, Respondent filed a request for a 
hearing and the matter was docketed before Administrative Law Judge 
Gail A. Randall. On May 21, 1998, Judge Randall issued an Order for 
Prehearing Statements, and on June 10, 1998, the Government filed its 
prehearing statement. Respondent was given until July 2, 1998, to file 
its prehearing statement. In her Order for Prehearing Statements, the 
Administrative Law Judge cautioned Respondent ``that failure to file 
timely a prehearing statement as directed above may be considered a 
waiver of hearing and an implied withdrawal of a request for hearing.'' 
On July 8, 1998, Judge Randall issued an Order indicating that she had 
not yet received a prehearing statement from Respondent; advising 
Respondent that failure to file a prehearing statement will be deemed a 
waiver of its right to a hearing; and giving Respondent until July 22, 
1998, to file such a statement along with a motion for late acceptance.
    On July 27, 1998, the Administrative Law Judge issued an Order 
Terminating Proceedings, finding that Respondent had failed to file a 
prehearing statement, and therefore, concluding that Respondent waived 
its right to a hearing. Judge Randall noted that the record would be 
transmitted to the then-Acting Deputy Administrator for entry of a 
final order based upon the investigative file. Therefore, the Deputy 
Administrator, finding that Respondent has waived its right to a 
hearing, hereby enters his final order without a hearing and based upon 
the investigative file pursuant to 21 CFR 1301.43(e) and 1301.46.

[[Page 1824]]

    The Deputy Administrator finds that DEA initiated an investigation 
of Respondent following receipt of information that individuals were 
getting controlled substances from Respondent without presenting a 
prescription from a physician. DEA investigators went to Respondent on 
August 14, 1996, to conduct an accountability audit of selected 
Schedule III and IV controlled substances for the period March 5, 1995 
to August 14, 1996. The audit revealed shortages of 4,791 dosage units 
and overages of 4,216 dosage units. While reviewing Respondent's 
prescription records, the investigators noticed that a number of the 
prescriptions were visibly altered, that many prescriptions were 
duplicated, and that there were prescriptions that had been filled with 
no date, no DEA number or an incorrect DEA number.
    In November 1996, investigators obtained statements from three 
physicians whose names appeared on prescriptions found at Respondent. 
Each of the physicians reviewed a list of the prescriptions attributed 
to them and determined that they had not authorized the prescriptions.
    Also, in November 1996, investigators obtained statements from 
three individuals regarding the dispensing practices at Respondent. One 
individual stated that she had not received any of the hydrocodone or 
Vicodin that was indicated on prescriptions bearing her name as the 
patient. Another individual stated that she had been going to 
Respondent for 15 years and at one point she did not have a refill on a 
cough suppressant. Bill Lloyd, Respondent's owner and pharmacist, told 
her that he would refill the prescription and that she could bring him 
a prescription later to cover the dispensation. Bill Lloyd would sell 
her controlled substances without a prescription for $10.00 an ounce 
for cough syrup and for $1.00 a pill for other controlled substances. 
According to the individual, Bill Lloyd would tell her to bring in a 
prescription of any kind because he could ``fix it.'' the individual 
reviewed the prescriptions attributed to her and stated that there was 
no way that she could have used all of the prescriptions listed. At 
most she would receive 50 pills at a time given the large amount of 
money Bill Lloyd charged her. Finally, the second individual's husband 
told investigators that he suspected that Bill Lloyd was giving codeine 
type drugs to his wife without a prescription. He stated that he 
confronted Bill Lloyd at least two times but that Bill Lloyd ``made 
light of my threats to turn him in to [the] authorities, laughed at me, 
and said (or implied) that it would cause my wife much more trouble 
than it would cause him.''
    A cooperating individual went to Respondent pharmacy on November 
13, 20, and 26, 1996, to attempt to purchase controlled substances 
without a physician's prescription. During each visit, the cooperating 
individual was monitored by law enforcement personnel. One each 
occasion, the individual obtained 40 hydrocodone 5 mg. tablets from 
Respondent pharmacy in an unlabeled bottle without presenting a 
prescription. On December 5, 1996, the cooperating individual attempted 
to introduce an undercover officer to obtain controlled substances 
without a physician's authorization, but Bill Lloyd refused to sell 
hydrocodone on this occasion without a prescription.
    On December 17, 1996, investigators obtained statements from three 
other individuals regarding the illegal sale of controlled substances 
by Bill Lloyd. These individuals indicated that Bill Lloyd would sell 
them whatever controlled substance they wanted. He would charge between 
$1.00 and $3.00 per pill or he would trade controlled substances for 
things of value such as tools, rings or razors. One individual 
indicated that the drug bottles that he obtained from Respondent never 
had a label on them.
    Pursuant to 21 U.S.C. 824(a)(4) and 823(f), the Deputy 
Administrator may revoke a DEA Certificate of Registration and deny any 
application for such registration, if he determines that the continued 
registration would be inconsistent with the public interest. Section 
823(f) requires that the following factors be considered:
    (1) The recommendation of the appropriate state licensing board or 
professional disciplinary authority.
    (2) The applicant's experience in dispensing, or conducting 
research with respect to controlled substances.
    (3) The applicant's conviction record under federal or state laws 
relating to the manufacture, distribution, or dispensing of controlled 
substances.
    (4) Compliance with applicable state, federal, or local laws 
relating to controlled substances.
    (5) Such other conduct which may threaten the public health or 
safety. These factors are to be considered in the disjunctive, the 
Deputy Administrator may rely on any one or a combination of factors 
and may give each factor the weight he deems appropriate in determining 
whether a registration should be revoked or an application for 
registration denied. See Henry J. Schwarz, Jr., M.D., 54 FR 16,422 
(1989).
    Regarding factor one, there is no evidence in the record that the 
State of Texas has taken any action against Respondent's pharmacy 
permit or the pharmacist permit of Bill Lloyd. As to factor three, 
there is also no evidence that Respondent pharmacy or Bill Lloyd have 
been convicted of any controlled substance related offense.
    However, there is more than ample evidence in the record regarding 
factors two and four, Respondent's experience in dispensing controlled 
substances and its compliance with applicable controlled substance 
laws. The shortages and overages revealed by the accountability audit 
show that Respondent does not keep complete and accurate records of its 
controlled substance handling as required by 21 U.S.C. 827 and 21 CFR 
1304.21. Respondent dispensed controlled substances pursuant to 
prescriptions that were visibly altered and that did not contain the 
required information in violation of 21 CFR 1306.04 and 1306.05. 
Finally, Respondents dispensing of controlled substances without a 
physician's authorization violates 21 U.S.C. 841 and 21 CFR 1306.04
    There does not appear to be any evidence in the record regarding 
other conduct by Respondent that would threaten the public health and 
safety under factor five.
    But the Deputy Administrator is extremely troubled by Respondent's 
dispensing practices. The evidence in the record indicates that 
Respondent pharmacy and Bill Lloyd, its owner and pharmacist, were 
actively involved in the diversion of controlled substances into the 
illicit market. Such behavior by DEA registrant cannot be tolerated. 
Respondent has not offered any evidence in mitigation. Therefore, the 
Deputy Administrator concludes that Respondent's continued registration 
would be inconsistent with the public interest.
    Accordingly, the Deputy Administrator of the Drug Enforcement 
Administration, pursuant to the authority vested in him by 21 U.S.C. 
823 and 824 and 28 CFR 0.100(b) and 0.104, hereby orders that DEA 
Certificate of Registration AB2243246, previously issued to Bill Lloyd 
Drug, be, and it hereby is, revoked. The Deputy Administrator further 
orders that any pending applications for the renewal of such 
registration, be, and they hereby are, denied. This order is effective 
February 11, 1999.


[[Page 1825]]


    Dated: January 5, 1999.
Donnie R. Marshall,
Deputy Administrator.
[FR Doc. 99-557 Filed 1-11-99; 8:45 am]
BILLING CODE 4410-09-M