[Federal Register Volume 65, Number 234 (Tuesday, December 5, 2000)]
[Notices]
[Pages 75959-75969]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-30930]
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DEPARTMENT OF JUSTICE
Drug Enforcement Administration
[Docket No. 99-10]
Nicholas A. Sychak, d/b/a Medicap Pharmacy; Revocation of
Registration
The Deputy Administrator, Drug Enforcement Administration (DEA),
issued an Order to Show Cause dated December 14, 1998, to Nicholas A.
Sychak d/b/a Medicap Pharmacy (Respondent), seeking to revoke the
Replacement's DEA Certificate of Registration, BM2751736, pursuant to
21 U.S.C. 824(a)(4); and to deny any pending application for renewal of
such registration pursuant to 21 U.S.C. 823(f) because the registration
would be inconsistent with the public interest as defined by 21 U.S.C.
823(f). Specifically, the Order to Show Cause alleged that: (1) On June
20, 1996, DEA obtained information that Nicholas A. Sychak, R.Ph., the
owner and operator of Medicap Pharmacy, ordered large quantities of
various Schedule II through IV controlled substances and diverted these
drugs to other individuals for no legitimate medical purpose; (2) Also
on June 20, 1996, a cooperating individual provided DEA investigators
with information that Mr. Sychak was a known source of supply for
illegally diverted controlled substances, and that drug dealers and
drug dependent individuals traveled to Medicap Pharmacy to purchase
large quantities of controlled substances for sums ranging from several
hundred to several thousand dollars per transaction; (3) On August 8,
1997, a confidential source, posing as a physician, telephoned Mr.
Sychak and placed a fictitious prescription for sixty dosage units of
hydrocodone, a Schedule II controlled substance, with no refills. Mr.
Sychak was aware the individual calling in the prescription was not a
physician, but nevertheless filled the prescription in exchange for
cash. Mr. Sychak also authorized two refills for the prescription, even
though prescriptions for Schedule II controlled substances may not be
refilled; (4) Also on August 8, 1997, the confidential source placed
another telephone call to Mr. Sychak, posing as another physician. When
the confidential source later arrived at Medicap Pharmacy, Mr. Sychak
directed that individual to exhaust the refills under the first
physician's name before using a second physician's name to obtain
additional prescriptions; (5) On August 22, 1997, a confidential
source, acting in an undercover capacity, obtained the remaining
unauthorized refill of the August 8, 1997, fraudulent hydrocodone
prescription from Mr. Sychak, again in exchange for cash; (6) On
September 5, 1997, a confidential source again posed as a physician and
telephoned Mr. Sychak for a fictitious prescription for sixty dosage
units of hydrocodone. The confidential source was also provided with a
blank prescription bearing fictitious physician information. While on
Medicap Pharmacy's premises, and within the presence of Mr. Sychak, the
confidential source wrote out a prescription for sixty tablets of
Percocet, a Schedule II controlled substance. Mr. Sychak admonished the
confidential source for filling out the prescription in the pharmacy,
but filled the prescription and also provided the confidential source
with sixty hydrocodone tablets; (7) The DEA investigation revealed that
from June 1995 through October 1997, Mr. Sychak and Medicap Pharmacy
illegally dispensed more than 5,700 dosage units of Percocet to one
individual. This individual presented forged prescriptions attributed
to a physician and used the aliases ``Walter Kaczynski'' and ``Linda
Kaczynski.'' DEA subsequently verified that the purported prescribing
physician never issued the prescriptions; (8) The DEA investigation
further revealed that Mr. Sychak and Medicap Pharmacy unlawfully
dispensed a total of 5,255 dosage units of controlled substances to
another individual between July 17, 1997, and December 30, 1997,
pursuant to prescriptions purportedly issued by two different
physicians. DEA subsequently verified that neither of these two
physicians authorized the dispensing of these controlled substances;
(9) The DEA investigation further revealed that between July 1997 and
March 1998, Mr. Sychak and Medicap Pharmacy unlawfully dispensed a
total of 7,225 dosage units of various controlled substances, plus 48
ounces of Hydromet syrup, to two individuals who utilized eight aliases
on prescriptions attributed to one physician; (10) On April 24, 1998, a
confidential source acting in an undercover capacity purchased two
prescription vials containing seventy-five dosage units of hydrocodone
each and one prescription vial containing seventy-five dosage units of
Vicodin, a Schedule III controlled substance, without a prescription,
from Mr. Sychak and Medicap Pharmacy in exchange for $277.00 in cash.
These prescription vials listed three different aliases previously used
by the confidential source. The DEA investigation subsequently revealed
that Mr. Sychak created fraudulent records of this transaction by
indicating that these drugs were dispensed to three different
individuals; (11) On April 24, 1998, an additional confidential source
illegally obtained from Mr. Sychak and Medicap Pharmacy two
prescription vials containing seventy-five hydrocodone each and another
vial containing sixty hydrocodone in exchange for $281.00 in cash. Mr.
Sychak listed on the vials three different aliases previously used by
the confidential source and created
[[Page 75960]]
fraudulent dispensing records of this transaction; (12) On April 24,
1998, DEA agents and investigators executed a search warrant upon Mr.
Sychak and Medicap Pharmacy. During the search, Mr. Sychak admitted
that he sold controlled substances without prescriptions. Items seized
pursuant to the search warrant included $14,906 in cash, eight dosage
units of various Schedule III controlled substances that were found in
Mr. Sychak's front pants pocket, and a loaded 9mm handgun; (13) In
conjunction with the criminal diversion investigation of Medicap
Pharmacy, DEA also conducted a financial investigation of Mr. Sychak
and the pharmacy. As a result of this investigation, DEA investigators
obtained a federal seizure warrant for the business bank account of
Medicap Pharmacy, and pursuant to that warrant DEA seized $102,650.90;
(14) On September 3, 1998, an undercover informant obtained 1,120
dosage units of Schedule III and IV controlled substances from Mr.
Sychak and Medicap Pharmacy without a prescription and in exchange for
$2,000.00 cash. On September 22, 1998, the undercover informant again
obtained 1,120 dosage units of Schedule III and IV controlled
substances from Mr. Sychak and Medicap Pharmacy without a prescription
and in exchange for $2,000.00 cash; and (15) On November 5, 1996, Mr.
Sychak inquired of DEA regarding the DEA registration and medical
license status of a Pennsylvania medical practitioner. Although DEA
personnel informed Mr. Sychak that the practitioner was not registered
with DEA and did not possess a valid Pennsylvania medical license,
Medicap Pharmacy nevertheless proceeded to fill approximately 111
controlled substance prescriptions purportedly issued by the physician
between December 1996 and April 1997. The Order to Show Cause further
gave notice that Respondent's Certificate of Registration was
immediately suspended, and the suspension would remain in effect until
a final determination is reached in these proceedings. The Order
authorized and directed DEA agents and diversion investigators to place
under seal and remove all controlled substances possessed by Respondent
pursuant to his DEA Registration and to take into their possession the
suspended Certificate of Registration and all unused official DEA order
forms.
Respondent, through counsel, timely requested a hearing on the
issues raised in the Order to Show Cause. The requested hearing was
held in Pittsburgh, Pennsylvania, on July 12 and 13, 1999. At the
hearing the Government called witnesses to testify and introduced
documentary evidence. After the hearing, the Government submitted
Proposed Findings of Fact, Conclusions of Law, and Argument. In a
letter dated September 14, 1999, and received September 17, 1999,
counsel for Respondent advised that, ``without conceding any of the
facts in the government pleadings or those presented at the
administrative hearing on July 13 and 14, 1999, Nicholas A. Sychak,
will not be filing proposed findings of fact, conclusions of law and
argument.'' On February 23, 2000, Judge Mary Ellen Bittner issued her
Opinion and Recommended Rulings, Findings of Fact, Conclusions of Law,
and Decision, recommending that Respondent's registration be revoked,
and any pending applications for renewal be denied. The record was
transmitted to the Deputy Administrator for final decision March 27,
2000.
The Deputy Administrator has considered the record in its entirety,
and pursuant to 21 CFR 1316.67, hereby issues his final order based
upon findings of fact and conclusions of law as hereinafter set forth.
The Deputy Administrator adopts in its entirety the Opinion and
Recommended Rulings, Findings of Fact, Conclusions of Law, and Decision
of the Administrative Law Judge (Opinion). His adoption is in no manner
diminished by any recitation of facts, issues, and conclusions herein,
or of any failure to mention a fact or matter of law. The Respondent
did not introduce evidence or call witnesses at the hearing, therefore
Judge Bittner's Opinion is based on testimony and other evidence
offered by the Government.
As a preliminary matter, counsel for Respondent raised two
evidentiary issues that must be addressed before the merits of these
proceedings can be fully discussed.
First, on June 9, 1999, counsel for Respondent filed a Motion to
Compel Discovery Pursuant to Brady v. Maryland that requested Judge
Bittner to issue ``an order requiring DEA to preserve and to provide
defendant, within a time to be specified, any and all actual and
potential exculpatory evidence relating to the issues of guilt or
punishment currently known to the Government, its agents, and
representatives, or which may become known to them by the exercise, on
their part, of due diligence.'' (Emphasis original). In support of this
request, counsel for Respondent cites numerous cases applying Brady v.
Maryland, 373 U.S. 83 (1963) (Brady) in various criminal contexts.
Counsel for Respondent did not address the issue and cited no authority
for the proposition that Brady is or should be applicable to civil
proceedings, much less an administrative proceeding, as is the case
here. On June 24, 1999, the Government filed an Opposition to
Respondent's Motion to Compel Discovery Pursuant to Brady v. Maryland,
arguing that the Administrative Procedure Act (APA) confers no
independent discovery right; that Brady applies only in the criminal
context; that DEA regulations govern discovery in these proceedings;
and that the DEA regulations provide for adequate discovery. On June
30, 1999, Judge Bittner issued a Ruling and Order, finding Brady
inapplicable to these proceedings, but further finding that because
these proceedings are adversarial, ``on the grounds of fairness, * * *
the Government must disclose any exculpatory information in its
possession when such information is timely requested by a respondent.''
In response, the Government filed on July 7, 1999, an Emergency Request
For Consent to File Appeal to the June 30, 1999, Ruling of the
Administrative Law Judge, arguing that neither the APA nor the DEA
regulations governing the proceedings provide for the disclosure of
exculpatory information, and further that Judge Bittner's Order
``constitutes a significant and unprecedented departure from DEA
regulations and practice.'' The Government also argued that Judge
Bittner's Order would place a severe burden upon DEA, including the
potentialities of placing ongoing investigations and the identities of
confidential informants at risk. Subsequently, on July 8, 1999, Judge
Bittner issued a Memorandum to Counsel Clarifying Ruling and Order,
limiting the scope her previous ruling somewhat by requiring the
Government's counsel only ``to review files available to him and on
which the Government relied in preparing its prehearing statements for
information that would clear or tend to clear Respondent from alleged
fault or guilt as to the allegations of Respondent misconduct made in
the Government's prehearing statements in this proceeding[.]'' On the
same day, Judge Bittner issued a Ruling Denying Request for Consent to
File Appeal, denying the Government's request to file an appeal
pursuant to the Clarifying Ruling and Order. On July 9, 1999, the
Government filed a Response and Objection to Ruling Denying Request For
Consent to File Appeal reiterating its objections and requesting that
the issue be made
[[Page 75961]]
part of the official administrative record and forwarded to the Deputy
Administrator for consideration.
The Deputy Administrator agrees with the Government, for the
following reasons:
First, these proceedings are governed generally by the APA, and
specifically by the procedures set forth at 21 CFR 1316.41-1316.68. See
21 CFR 1316.41. What applicable caselaw there is on the issue finds
that the APA confers no independent discovery right; McClelland v.
Andrus, 606 F.2d 1278, 1285 (D.C. Cir. 1979); National Labor Relations
Board v. Valley Mold Co., Inc., 530 F.2d 693 (6th Cir. 1976) (cert.
denied, 429 U.S. 824 (1976)); and that the extent of discovery in
administrative proceedings is primarily determined by the agency;
Mister Discount Stockbrokers, Inc. v. Securities Exchange Commission,
768 F.2d 875, 878 (7th Cir. 1985) (finding Brady inapplicable to agency
administrative proceedings). As the Government correctly points out,
neither the APA, nor the relevant DEA regulations, nor prior published
DEA precedent, authorize the Government's production of exculpatory
information.
Second, the applicable DEA Regulations, supra, supply more than
sufficient due process, whether Respondent's DEA Registration is viewed
as a license conferred based on the public interest alone, or whether
it is also viewed as a property or a liberty interest. The pertinent
DEA Regulations governing these proceedings authorize a pre-hearing
conference and written pre-hearing statements for inter alia the
simplification of the issues, stipulations, identification of
witnesses, and the advance submission of all documentary evidence and
affidavits for identification; an administrative hearing, reported
verbatim; representation by counsel; allow for the introduction of
evidence and documents; provide for witnesses and documents to be
subpoenaed; allow for the examination and cross-examination of
witnesses; allow for the parties to make written proposed corrections
to the transcript of the hearing; allow for the parties to submit
proposed findings of fact and conclusions of law; and also allow for
the parties to file exceptions to the ALJ's recommended decision,
findings of fact and conclusions of law. Furthermore, the pre-hearing
conference pursuant to 21 CFR 1316.54 and the prehearing disclosure of
witness testimony and documentary evidence pursuant to 21 CFR 1316.57
and 1316.58, set forth in each party's pre-hearing statement, provide
more than adequate pre-hearing disclosure of the issues and evidence to
be submitted in these proceedings. In its June 24, 1999, memorandum of
Opposition, the Government notes that ``[i]n this proceeding, the
evidentiary items that the Government intends to offer were outlined in
its March 1, 1999, Prehearing Statement and the May 24, 1999,
supplement thereto. The Government has provided to the Respondent all
evidentiary items that it intends to offer during the upcoming
administrative hearing.'' Thus, the Deputy Administrator finds the
current DEA regulations provide more than adequate discovery in these
proceedings, and there was no need for the Government to take the
unprecedented and extraneous step of disclosing potentially exculpatory
information.
Third, in her June 30, 1999, Ruling and Order, Judge Bittner stated
her belief that the burden said Order placed upon the Government was
``minimal, for the Government need only review its files to determine
if such information exists.'' Following the filing of the Government's
June 24, 1999, Opposition memorandum, Judge Bittner attempted to narrow
the scope of her Order in her July 8, 1999, Clarifying memorandum by
limiting the Government's burden to review of those files ``available *
* * and on which the Government relied in preparing its prehearing
statements for [exculpatory] information * * * as to the allegations of
Respondent misconduct made in the Government's prehearing statements in
the proceeding[.] '' The Deputy Administrator agrees with the
Government that, even in its more limited form, Judge Bittner's Order
places a significant burden on the Government. The Order creates a risk
of disclosure of sensitive information which could reveal the identity
of confidential informants, compromise the effectiveness of
investigative techniques, or compromise an ongoing criminal
investigation concerning the Respondent on third parties. The Order
will also require the Government to address Privacy Act issues with
respect to information concerning third parties.
For the above-stated reasons, the Deputy Administrator finds that
the Government is not required to disclose potentially exculpatory
information to Respondent or counsel for Respondent at any phase of
these proceedings.
The second evidentiary issue raised by counsel for Respondent is
his assertion of a continuing objection to the Government's use of
hearsay evidence at the hearing. It is well established, however, that
hearsay is admissible in these proceedings. See Arthur Sklar, R.Ph., d/
b/a King Pharmacy, 54 FR 34623, 34627 (DEA 1989). ``Hearsay is both
admissible, and may, standing by itself, constitute substantial
evidence in support of an administrative decision.'' Klinestiver v.
DEA, 606 F.2d 1128 (D.C. Cir. 1979). Judge Bittner addressed this issue
at the hearing and in her Opinion, and she has indicated that she
considered the hearsay nature of the evidence when determining the
evidentiary weight to give it; and she further indicated that, where
she has relied on hearsay evidence, she did so because she found it
reliable. See Ramon P. Johnson v. United States, 628 F.2d 187, 190
(D.C. Cir. 1980). The Deputy Administrator concurs with Judge Bittner's
analysis and findings of fact with regard to this issue.
Medicap Pharmacy is located in Murrysville, Pennsylvania. According
to one of the Government's witnesses, Karen Ruffner, Nicholas A. Sychak
opened the pharmacy in 1989 or 1990. The pharmacy was first registered
with DEA on July 2, 1991. On June 20, 1996, a confidential informant
advised Diversion Investigator John Conlon of the DEA Pittsburgh
Resident Office that Mr. Sychak was selling controlled substances to
certain individuals without a valid prescription and for no legitimate
medical purpose.
As a result of this information, DEA initiated an investigation of
the Respondent, and various Pennsylvania State law enforcement agencies
subsequently joined the investigation. Surveillance and intelligence
gathering identified Lynette Reffner and Steve and Karen Ruffner as
frequent visitors to the pharmacy. Investigators also searched the
pharmacy's dumpster and found computer printouts of purported
controlled substance dispensings. These printouts listed an
individual's name, a prescription number, the drug, the date it was
dispensed, and the name of the physician who purportedly authorized the
dispensing. Agent Edward Cartwright of the Pennsylvania Bureau of
Narcotics Investigations and Drug Control (BNIDC) testified that a
review of these printouts disclosed discrepancies, such as
prescriptions whose dates were inconsistent with the computer's system
of numbering prescriptions in chronological order. According to Agent
Cartwright, these printouts indicated that some prescriptions were
predated. Investigators subsequently learned from pharmacy employees
that Mr. Sychak also ``predated'' prescriptions by substituting an old
ribbon in the pharmacy's printer to make it appear
[[Page 75962]]
that a label was older than the date the drug was actually dispensed.
As the Order to Show Cause indicates, there are numerous separate
incidents upon which this proceeding is based. Therefore, the different
incidents are herein organized by the nine subsequent numbered sections
which group the relevant facts, though not necessarily in chronological
order, since the timeframes of many of the events described herein
overlap.
1. Michael Ray's 1997 Undercover Purchases from Medicap Pharmacy
Agent Cartwright had arrested Michael Ray several years prior to
the investigation of Respondent. Mr. Ray was again arrested in the
spring of 1997, and the arresting agent asked Agent Cartwright for
information about Mr. Ray. Consequently, Agent Cartwright spoke to Mr.
Ray, who said that for the previous two years Mr. Sychak had filled
forged controlled substance prescriptions for him and that these
prescriptions listed ``Ed Olson'' as the patient. At some point, Mr.
Ray agreed to act as an undercover informant; Agent Cartwright
testified that Mr. Ray was not offered anything in return for his
cooperation except that Agent Cartwright appeared at Mr. Ray's
sentencing hearing and advised the court of Mr. Ray's cooperation.
On August 8, 1997, Mr. Ray telephoned Mr. Sychak, pretending to be
a Dr. Wigle, a name he had picked out of a telephone directory, and
asked for sixty hydrocodone 7.5 mg. extra strength, with no refills,
for ``Ed Olson.'' That same day, Mr. Ray went to Medicap Pharmacy
wearing a recording device, and carrying funds Agent Cartwright had
provided him. Mr. Ray paid $37.50 and received the sixty hydrocodone he
had requested. The memorialization of the oral prescriptions lists one
refill.
On August 15, 1997, Mr. Ray again called the pharmacy, pretending
to be a Dr. Beck, to authorize a prescription for hydrocodone for Ed
Olson. ``Dr. Beck'' was a fictitious physician invented by DEA for whom
Mr. Ray provided fictitious telephone and DEA registration numbers. Mr.
Ray called the pharmacy again to ask if the prescription was ready, and
spoke with Mr. Sychak's wife. Mr. Ray said that he knew he had refills
from Dr. Wigle's prescription, and Ms. Sychak said something to the
effect that there should not be any problem and that she would give him
a refill of what was on the computer screen. Mr. Ray then visited the
pharmacy and paid $37.50 for a ``refill'' of the Dr. Wigle
prescription. Mr. Sychak refused to fill the purported prescription
from Dr. Beck, telling Mr. Ray that he first wanted to use the refills
from Dr. Wigle and that the information about Dr. Beck, including his
physician license number and his DEA number, were not yet in the
pharmacy's computer system.
On August 22, 1997, Mr. Ray returned to Medicap Pharmacy and paid
$37.50 for a second refill of sixty hydrocodone from the Dr. Wigle
prescription. Mr. Ray also had with him a blank prescription form
listing the information for Dr. Beck so that Mr. Sychak could enter the
information into the pharmacy computer. Agent Cartwright testified that
Mr. Ray gave the form to Mr. Sychak, who said it would be helpful and
put the form in his pocket.
On August 29, 1997, Mr. Ray was sent into the pharmacy with a
recording device. Prior to this visit, a prescription for hydrocodone
purportedly authorized by Dr. Beck had been called in to the pharmacy.
During that visit, Mr. Ray also tried to obtain other controlled
substances using the blank Dr. Beck form, but Mr. Sychak refused to
provide him any drugs, saying that DEA investigators sometimes
inspected the pharmacy and might realize that the handwriting on Dr.
Beck's prescription form was the same as that on other pharmacy
records. Mr. Sychak returned the blank form to Mr. Ray. Mr. Ray took
the blank form with him when he left the pharmacy and, in the presence
of Agent Cartwright, filled it out for sixty Percocet. Mr. Ray then
took the form back into the pharmacy, paid $39.83 in cash, and received
sixty Percocet.
Mr. Ray made another undercover visit to the pharmacy on September
5, 1997. Mr. Ray asked for the hydrocodone purportedly authorized by
Dr. Beck for Ed Olson, and presented a written prescription for
Percocet in some other patient name. Agent Cartwright testified that
investigators had intentionally made this Percocet prescription
facially invalid by showing the patient as someone other than the
person who presented it. Ray paid $37.50 for sixty hydrocodone 7.5 mg.
with APAP, but Mr. Sychak refused to fill the Percocet prescription.
Mr. Ray then took from his pocket a blank prescription form purporting
to be that of Dr. Beck and filled in the requisite information in Mr.
Sychak's presence. Mr. Sychak said something to the effect that most of
his customers did not fill out their own prescriptions in front of him,
but nonetheless filled the prescription, providing Mr. Ray sixty
Roxicet in exchange for $47.95. On September 12, 1997, Mr. Ray again
visited Respondent and obtained hydrocodone pursuant to the purported
authorization of Dr. Beck, paying $37.50 for the drug.
As noted above, investigators obtained records of purported
dispensings from Respondent's trash dumpster. Among these was the
pharmacy's receipt for the Roxicet provided to Mr. Ray on September 5.
2. The Delivery of Controlled Substances to Walter, Linda, and
James Kaczynski
Pennsylvania state law requires pharmacists to submit to BNIDC
monthly a form known as a ``BDC-6'' listing information about all
dispensings of Schedule II controlled substances. In early 1998
Investigator Conlon reviewed BDC-6 forms Respondent had submitted for
the period April 1995 through October 1997. Respondent listed a large
number of Percocet and Roxicet prescriptions purportedly issued by a
Dr. Mark Fennema to a Walter Kaczynski, a Linda Kaczynski, and a James
Kaczynski. Although the BDC-6 reports indicated that Dr. Fennema was an
emergency room physician at a hospital in south Pittsburgh, when
investigators subpoenaed the hospital for the Kaczynskis' medical
records, the hospital responded that it had not treated any patients
with any of those names.
In about March 1998 Investigator Conlon telephoned Dr. Fennema, who
was at that time in upstate New York. Dr. Fennema told Investigator
Conlon that he generally saw patients only in the emergency room and
that he would have no reason to continually prescribe medications to
the same patient. After reviewing a faxed copy of the list of
prescriptions, Dr. Fennema told Investigator Conlon that he had not
issued them.
3. The Deliveries to Lynette Reffner and Michael Riley
Investigator Conlon testified that Medicap Pharmacy records showed
that it had dispensed controlled substances to a Lynette Reffner
pursuant to prescriptions purportedly issued by a Dr. Richard Kucera
between July 17, 1997, and December 23, 1997, and pursuant to
prescriptions purportedly issued by a Dr. David Blinn between July 17,
and December 30, 1997. The prescriptions that Dr. Blinn purportedly
issued totaled 1,620 dosage units of Vicodin, 715 dosage units of
hydrocodone, 164 dosage units of Hydroment syrup, and 60 dosage units
of phenobarbital. The prescriptions that Dr. Kucera purportedly issued
aggregated to 1,390 dosage units of alprazolam, 1,240 dosage units of
Ap-Oxazepam, 130 dosage units of
[[Page 75963]]
diazepam, and 100 dosage units of Darvocet.
On March 25, 1998, Investigator Conlon and Agent Cartwright
interviewed Dr. Kucera, who said that he had treated Lynette Reffner
but had not authorized any of the prescriptions at issue. Investigator
Conlon, DEA Diversion Investigator Kurt Dittmer of DEA's Pittsburgh
office, and Agent Cartwright interviewed Dr. Blinn on March 30, 1998,
and showed him the list of prescriptions. Dr. Blinn advised the
investigators that he had not authorized any of them.
On April 29, 1998, Investigators Conlon and Dittmer, Agent
Cartwright, and Sergeant Stan King of the Murrysville Police Department
interviewed Ms. Reffner and her paramour, Michael Riley. Subsequently,
on June 17, 1999, Ms. Reffner executed a declaration in evidence as a
Government exhibit. In the declaration, Ms. Reffner said she originally
had valid prescriptions for controlled analgesics filled at Medicap
Pharmacy, but in 1992 or shortly thereafter Mr. Sychak began giving her
refills for these medications that were not authorized by her
physician. Ms. Reffner further stated that by about 1994 she had
arranged with Mr. Sychak to purchase drugs from him upon presenting
lists of the controlled substances she wanted. Investigators found some
of these lists during the searches of Medicap Pharmacy's trash
dumpster.
Ms. Reffner stated that every Tuesday she and Mr. Riley purchased
sixty Vicodin ES, sixty Xanax, fifty Darvocet, fifty Soma, and eight
ounces of Hydromet syrup, and every Friday they bought the same
quantities of Xanax, Soma, and Hydromet syrup, along with eighty
Vicodin ES and sixty Darvocet. Ms. Reffner stated that Mr. Sychak had
told her and Mr. Riley that Soma in combination with the other drugs
would ``intensify the high,'' and that they should take a half-tablet
of Soma at mealtimes. Ms. Reffner stated that the Soma was listed on
Mr. Riley's patient record at the pharmacy, but that Mr. Sychak said he
recorded the other drugs as dispensed to her, because she had been
severely injured some years earlier and her medical history ``would
cover it.'' Ms. Reffner also stated that at some point Mr. Sychak
directed Mr. Riley to come to the pharmacy only on Tuesdays and
Fridays, when Mr. Sychak and his wife were present, because Mr. Sychak
did not want his relief pharmacist to know about this arrangement. Ms.
Reffner stated that Mr. Riley and Mr. Sychak also socialized together,
and that Mr. Riley worked on Mr. Sychak's cars and Mr. Sychak gave him
``care packages'' of controlled substances, including Lorcet and
Vicodin.
Ms. Reffner further stated that in late 1995 she entered a
methadone treatment program and that Mr. and Ms. Sychak agreed to
provide her a phenobarbital to lessen potential withdrawal symptoms.
Ms. Reffner said that both she and Mr. Riley wanted to get help for
their addiction and that the Sychaks said they would decrease the
quantity of controlled substances they supplied, but in fact the
quantity increased. Ms. Reffner also stated that on numerous occasions
when she presented a legitimate prescription for a non-controlled
substance, Mr. Sychak told her she would not have to pay for the
medication, and that he would charge it to some other customer's
insurance. Finally, Ms. Reffner stated that Mr. Sychak filled some
drugs to her Medical Assistance card and that she paid cash for the
rest, that Mr. Sychak always extended her and Mr. Riley credit when
they did not have enough money to pay for the drugs they purchased, and
that Mr. Sychak maintained a record of how much they owed in a pink
notebook.
Investigator Conlon testified that as of the hearing date Ms.
Reffner and Mr. Riley were the targets of an ongoing investigation, and
he anticipated that they would be charged with state narcotics
violations. Investigator Conlon further testified that Mr. Riley and
Ms. Reffner agreed to cooperate in the investigation and that
investigators told them that their cooperation would be made known to
the proper authorities at the time of sentencing.
4. The Deliveries to Karen and Steven Ruffner
The previously mentioned trash dumpster searches disclosed receipts
purportedly showing Dr. Ralph Capone as the authorizing physician for
numerous controlled substance prescriptions for patients named Daniel
Frieben, Amy McKluskey, Phyllis Ruffner, Charles Ruffner, Steve
Ruffner, Grace Ruffner, Ruth Snow, and Deborah McCracken. In November
1997, Agent Cartwright interviewed Dr. Capone and asked him about these
individuals. Dr. Capone told Agent Cartwright that although Mr. Frieben
had been his patient, Dr. Capone had not treated him since about 1993,
and that Karen Ruffner was his patient during the period at issue but
that he did not authorize any of the prescriptions shown to him.
Karen Ruffner testified as a Government witness. Ms. Ruffner's
mother was Sandra Frieben, who died in 1992. For some period of time
prior to her death Ms. Frieben worked as a medical assistant to Dr.
Capone. Ms. Ruffner testified that Ms. Frieben suffered from a number
of painful conditions for which she took, Soma, Talwin, and Vicodin ES
and that she abused controlled substances from the end of 1989 until
her death. Ms. Frieben obtained drugs by calling prescriptions to
pharmacies for herself, saying that the prescriptions were authorized
by Dr. Capone, and by writing fake prescriptions for herself on
prescription pads she took from Dr. Capone's office. Ms. Ruffner
testified that she saw Ms. Frieben write some of these prescriptions,
that Ms. Frieben made some of the telephone calls from Ms. Ruffner's
home, and that Ms. Frieben asked Ms. Ruffner to take fake prescriptions
to the pharmacy for her. Ms. Ruffner testified that she suggested to
her mother that she seek treatment for drug abuse, but her mother
refused to do so because she did not want her husband to learn about
her problem.
Ms. Ruffner testified that although initially her mother used
different pharmacies, eventually she obtained drugs only from Medicap
Pharmacy. At some point, Ms. Frieben began stealing boxes of drug
samples from Dr. Capone's office and taking them to Mr. Sychak, who
gave her medication or discounts on medication in exchange. Ms. Ruffner
accompanied her mother on these visits to the pharmacy, and testified
that after she had done so three or four times, Ms. Frieben asked her
to take the samples to Mr. Sychak and bring back her medication. Ms.
Ruffner testified that her mother called Medicap Pharmacy both from Dr.
Capone's office and from Ms. Ruffner's home to authorize prescriptions
for herself for Vicodin, Talwin, or Soma, and sent Ms. Ruffner to the
pharmacy to pick up the drugs and to pay for them in cash. Ms. Ruffner
further testified that her mother instructed her to deal only with Mr.
Sychak.
Ms. Ruffner testified that her mother also asked her to call the
pharmacy and would write down exactly what Ms. Ruffner was to say. Ms.
Ruffner spoke only to Mr. Sychak, and testified that in these calls she
told Mr. Sychak that she was ``Beth'' from Dr. Capone's office (as far
as she knew, a made-up name) and that she was ``calling for Sandra
Frieben, for Vicodin number 50.'' Ms. Ruffner also testified that the
price of the controlled substances increased over time so that her
mother paid cash in addition to providing Mr. Sychak the drug samples.
Ms. Frieben eventually paid about $89 for 60 Talwin, about $68 for 50
Vicodin, and $34 for generic hydrocodone.
[[Page 75964]]
Ms. Ruffner further testified that her own health had been ``fairly
poor'' all her life, that she had suffered from chronic pain since she
was twelve years old, and that various physicians had prescribed her
controlled substances including Vicodin, Vicodin ES, and Soma. Ms.
Ruffner started sharing her mother's medications in 1989, when she was
nineteen years old, but testified that she never took her mother's
drugs without the latter's knowledge.
Ms. Ruffner testified that from 1992 until 1994 she received
legitimate prescriptions for Valium and Vicodin, and that she filled
all these prescriptions at Medicap Pharmacy. Ms. Ruffner further
testified that frequently the vial she received from the pharmacy
indicated more authorized refills than the prescription did, but she
never asked Mr. Sychak why refills were added. In 1994 Ms. Ruffner's
physician stopped prescribing her Vicodin, but Ms. Ruffner continued to
receive drugs from Mr. Sychak because he gave her more refills than
were authorized by the written prescription. As an example, Ms. Ruffner
testified that if a written prescription for 80 Vicodin ES showed one
refill, the vial might show four refills. Ms. Ruffner admitted,
however, that she did not know whether Mr. Sychak obtained the
physician's oral authorization for additional refills.
Ms. Ruffner further testified that at some point ``the refills just
stopped,'' and Mr. Sychak told her to call and ask for a prescription
for a named person because ``I have to be able to say that I received a
phone call from somebody.'' Consequently, according to Ms. Ruffner, she
called the pharmacy pretending to be ``Beth'' from Dr. Capone's office,
told Mr. Sychak she was authorizing a prescription for Vicodin ES, and
gave the patient's name variously as Amy McKluskey, Dan Frieben, Tina
Pavolik, Ruth Snow, Debbie McCracken, or Charles, Steve, Phyllis, or
Grace Ruffner. All of these names were those of individuals who were
either friends or family members of Ms. Ruffner or of her husband,
Steven Ruffner. According to Ms. Ruffner, between 1994 and 1998 she
made ``hundreds'' of such telephone calls to the pharmacy.
Ms. Ruffner testified that sometimes Mr. Sychak would fill
``prescriptions'' without requiring her to telephone him, but other
times he would tell her to call him so that he could say there had been
a telephone call. According to Ms. Ruffner, she usually handed Mr.
Sychak a piece of paper with a list of names and the controlled
substance to be attributed to each name, and sometimes she handed the
list to one of the women who worked at the pharmacy. (Agent Cartwright
testified that he found such lists during the searches of Medicap's
trash dumpster.)
Ms. Ruffner testified that she paid cash for the drugs and that in
1994 she paid about $89 for sixty Vicodin, but that almost every month
Mr. Sychak increased the price, telling her that the manufacturer had
increased its price. Ms. Ruffner also testified that she initially
obtained drugs from Respondent once per month and shared them with her
husband, and beginning in about 1996 she and her husband began selling
Lorcet and Vicodin in quantities of ten to fifty dosage units.
According to Ms. Ruffner, she and her husband used the proceeds of
their drug sales to purchase more drugs from Mr. Sychak for their own
use and to sell. Eventually, according to Ms. Ruffner, she was paying
Mr. Sychak a thousand dollars once or twice per week for drugs; she and
her husband would take ``what we needed, and we would sell the rest.''
Ms. Ruffner also testified that when she was in the pharmacy and other
people were present in addition to Mr. Sychak, she signaled to him that
she wanted Vicodin, Lorcet, or Lortab by referring to Vicodin as
``whites,'' and Lorcet or Lortab as ``blues.''
In early 1998 local police arrested Ms. Ruffner's husband for
possession of controlled substances. Ms. Ruffner testified that when
she told Mr. Sychak about the arrest he expressed concern about whether
any vials from Medicap Pharmacy would be found in Mr. Ruffner's car.
Ms. Ruffner further testified that a few days after the arrest she and
her husband asked Mr. Sychak for a prescription vial with a legitimate-
looking label on it so Mr. Ruffner could say that he had drugs legally.
Mr. Sychak complied with Ms. Ruffner's request, and provided him with a
legitimate-appearing prescription vial. At some point Mr. Sychak also
warned Mr. Ruffner to be sure that he did not leave pill bottles in his
car and to destroy the bottles when he had gotten rid of the contents.
On April 24, 1998, Investigator Conlon and three other law
enforcement officers visited Ms. Ruffner at her father's home, where
she was staying. Investigator Conlon asked Ms. Ruffner to go to the
local police station, and she agreed to do so. At the Murrysville
police station, Ms. Ruffner agreed to cooperate in the investigation
and Agent Cartwright asked her to make a controlled buy from Respondent
that same day. Investigators fitted Ms. Ruffner with a recording device
and gave her $400 to make the purchase. They also asked her to follow
the procedure she normally used to obtain drugs, and consequently she
prepared a note with the words, ``Karen's Vicodin (brand),'' ``Daniel's
Vicodin (generic),'' ``Tina's Lorcet (generic),'' and ``Amy's Lorcet
(generic).'' Next to the reference to ``brand,'' Ms. Ruffner drew an
arrow to the comment, ``I only have $400. However you can help me out.
Thanks.'' Ms. Ruffner went to Medicap Pharmacy and gave the list to Mr.
Sychak, who filled vials with the drugs listed. The total cost of the
drugs was $415; Ms. Ruffner asked Mr. Sychak if she could take the
drugs and return with the additional $15, but Mr. Sychak refused.
Consequently, Mr. Sychak retained the Vicodin, and Ms. Ruffner left the
store with the other drugs and gave them to Agent Cartwright. Agent
Cartwright testified that although the cash register receipts for Ms.
Ruffner's undercover purchase showed a small amount, such as $3 or $6,
she actually was spending about $300 to $365. Agent Cartwright further
testified that Mr. Ruffner also paid substantially more for the
controlled substances he was purchasing from Respondent than the amount
reflected on the cash register receipt.
As of the hearing date, Ms. Ruffner had not been charged with any
criminal conduct. She testified, however, that Agent Cartwright had
told her that she would be charged but had not told her what the
charges would be. Investigator Conlon testified that both Mr. and Ms.
Ruffner agreed to cooperate in the investigation and that the only
statements investigators made to them were that their cooperation would
be made known to the proper authorities at the time of sentencing.
Counsel for Respondent contended at the hearing that Ms. Ruffner,
the only informant to testify in this proceeding, is not credible. In
her Opinion, Judge Bittner recognizes that Ms. Ruffner is not a totally
disinterested participant in this proceeding in light of her own status
as a target of an investigation. Nonetheless, Judge Bittner found that
Ms. Ruffner appeared candid and forthright, and on the basis of her
demeanor Judge Bittner found her to be believable. In addition, Judge
Bittner found, and the Deputy Administrator agrees, that much of Ms.
Ruffner's testimony was consistent with documentary and other evidence
and, as noted above, Respondent adduced no evidence and thus Ms.
Ruffner's testimony is uncontradicted. See Singers-Andreini Pharmacy,
63 Fed. Reg. 4668, 4672 (DEA 1998).
5. The April 24, 1998, Search
On April 23, 1998, a United States Magistrate Judge issued a search
warrant
[[Page 75965]]
for the premises of Medicap Pharmacy. The warrant was executed on April
24, 1998. As part of the search, investigators received a ``dump'' of
Mr. Sychak's computer, and found that ``Walter Kaczynski'' was an alias
used by a Larry Stepinski.
The search disclosed substantial amounts of cash, specifically,
$11,394 in Mr. Sychak's briefcase, $2,306 in daily deposit envelopes,
$706 in a cash register, and $150 from a shelf in a work area.
Investigators also retrieved a ledger listing various persons,
including targets of investigations, and a running balance of what they
owed the pharmacy. In addition, investigators recovered $520 and a
small quantity of loose controlled substance tablets from Mr. Sychak's
pants pockets. This cash was the State funds that Agent Cartwright had
supplied to Karen and Steve Ruffner earlier in the day and that they
had used to make an undercover purchase of controlled substances at the
pharmacy. Investigator Dittmer testified that the currency was
photocopied before it was provided to the Ruffners and that the serial
numbers on the photocopies matched those on the bills found in Mr.
Sychak's pockets.
Investigator Dittmer also testified that he asked Mr. Sychak if he
had any rifles or handguns on the premises and that Mr. Sychak said he
did not have any weapons. The search disclosed a loaded 9mm
semiautomatic handgun in a plastic grocery bag, however, that also
contained cash. The weapon was registered to Mr. Sychak.
During the search, investigators also conducted an inventory of
several products containing hydrocodone. Respondent had on hand 18,000
dosage units of Vicodin, 13,000 dosage units of Lorcet, 1,500 dosage
units of Didrex, 5,200 dosage units of Darvocet, 3,000 dosage units of
Soma, and 10,500 dosage units of alprazolam. Although Soma is not
controlled under federal law, Investigator Dittmer testified that he
included it in his inventory because it is sometimes used to boost the
``high'' provided by hydrocodone.
Investigator Dittmer and Agent Cartwright interviewed Mr. Sychak
during the search and asked him if he ever dispensed a drug without a
legitimate prescription. Mr. Sychak responded affirmatively and said
that he sold drugs to people who were nagging him, naming Karen and
Steven Ruffner. The investigators also asked Mr. Sychak about the ``Dr.
Beck prescriptions,'' and Mr. Sychak said that he had spoken personally
with Dr. Beck about those prescriptions. When informed that Dr. Beck
was fictitious, Mr. Sychak did not respond.
6. The Interviews of Respondent's Employees
During the April 24, 1998, search investigators interviewed Sylvia
Macerelli, a pharmacy technician/clerk employed at Medicap Pharmacy.
Ms. Macerelli later provided a declaration, in evidence as a Government
exhibit. Ms. Macerelli stated that she, pharmacy technician/clerk Amy
Meyers, and relief pharmacist Fred Werl believed that Mr. Sychak was
committing fraud and distributing drugs illegally. More specifically,
Ms. Macerelli said that Mr. Sychak was the only pharmacy employee who
waited on the Ruffners and Ms. Reffner. Ms. Macerelli stated that the
Ruffners never presented prescriptions, but gave Mr. Sychak lists of
controlled substances on scraps of paper, and that they usually
received Vicodin and Lorcet. Ms. Macerelli stated that Ms. Reffner
similarly presented lists of controlled substances she wished to
purchase, that she received drugs in her own name and Mr. Riley's, and
that she received Vicodin, Darvocet, Xanax, and hydrocodone products.
Ms. Macerelli further stated that Mr. Sychak allowed Ms. Reffner to run
a tab, and as of the date of the search she owed approximately $1,000.
Ms. Macerelli also said that Mr. Sychak frequently directed her and
Ms. Meyers to add unauthorized refills to prescriptions, telling them
that he had checked with the prescribing physician for authorization,
but that she never observed Mr. Sychak telephone a physician for such
authorization until a few weeks before the search. Ms. Macerelli
further stated that she and Ms. Meyers recognized Ms. Ruffner's voice
on the telephone when she telephoned the pharmacy and pretended to be
calling from a doctor's office. Ms. Macerelli further stated that in
the summer of 1997 an assistant in a doctor's office across the street
from the pharmacy complained to Mr. Sychak that medicines that she
never received were fraudulently billed to her insurance company.
According to Ms. Macerelli, she and Ms. Myers would note that although
they indicated on the log sheet the last customer of the day to receive
drugs billed to insurance plans, the next day there would be additional
entries added to the log.
Investigators interviewed Amy Meyers on May 7, 1998. On May 25,
1999, Ms. Meyers executed a declaration, in evidence as a Government
exhibit, in which she corroborated many of Ms. Macerelli's statements.
Ms. Myers corroborated the information that the Ruffners, Ms. Reffner,
and Mr. Riley, obtained controlled substances from Medicap Pharmacy
after presenting handwritten notes listing drug names, numbers of
dosage units, and the names of persons for whom the drugs were
purportedly prescribed, and stated that Walter Kaczynski, Craig
Smilack, Linda Nader, Grace Seigworth, Scott Hoyle, Gary Harpis, Tom
Farrah, Steve Cuccaro, and Camille Maggio-Palmiere also received
controlled substances in a similar fashion. Ms. Meyers stated that all
these individuals either paid cash, ran a tab, or used a Medical
Assistance card. Ms. Meyers also stated that she checked her own
personal prescription profile at the pharmacy in the spring of 1998 and
discovered numerous prescriptions listed as billed to her insurance
carrier that were allegedly issued to her by various physicians she had
never seen for drugs she had never received. Ms. Myers stated that when
she confronted Mr. Sychak about these prescriptions he said, ``How do
you think I pay for your health insurance?''
On June 8, 1998, investigators interviewed Mr. Fred Werl. Mr. Werl
said that he had discovered that the prescriptions issued to the
Kaczynskis were forgeries when he called the hospital to verify a
prescription and was told that Dr. Fennema was no longer associated
with the hospital. Mr. Werl also told the investigators that he told
Mr. Sychak about these fraudulent prescriptions and Mr. Sychak said he
would take care of the matter, but that Mr. Sychak in fact continued to
fill these prescriptions. Mr. Werl said that ``Walter Kaczynski'' came
to the pharmacy and gave Mr. Sychak gifts, but that he did not know
whether these were in exchange for drugs. Mr. Werl told investigators
that at some point he was present when a commercial auditing firm
confronted Mr. Sychak and told him that some of the pharmacy documents
and records were fraudulent. Mr. Werl also told investigators about the
insurance log, and noted that one day he counted 65 entries added after
closing hours.
7. The Controlled Buys by Arthur Glaser
On July 27, 1998, Detective Michael Garlecki of the Allegheny
County Police Department Narcotics Unit advised Investigator Dittmer
that an Arthur Glaser was in custody and that a search of Mr. Glaser's
home had revealed some loose pills of controlled substances. Detective
Garlecki further advised Investigator Dittmer that Mr. Glaser said that
he had obtained these drugs from Medicap Pharmacy. Consequently,
Investigator Dittmer interviewed Mr. Glaser, who said that on either
July 17
[[Page 75966]]
or July 20, 1998, he had purchased four bottles of Lorcet, one bottle
of Vicodin, one bottle of Xanax, 200 Valium, and some ``speed'' from
Mr. Sychak without a prescription. Mr. Glaser said that he obtained
controlled substances in his own name and in the names of his brother
and sister, Joseph Glaser and Nanette Glaser, respectively.
Mr. Glaser further stated that he could make undercover purchases
from Mr. Sychak under the direction of law enforcement personnel. On
September 2, 1998, Mr. Glaser made a recorded telephone call to Mr.
Sychak and said he would go to the pharmacy the next day to pick up
refills on his inhaler medication and what Investigator Dittmer
described as ``other stuff.''
On September 3, 1998, Mr. Glaser, fitted with a recording device
and a transmitter and provided with $2,000 in DEA funds, went to the
pharmacy. Mr. Glaser obtained from Mr. Sychak 120 Vicodin ES, 500
alprazolam, and 500 Lorcet, in exchange for the $2,000 in cash. While
Mr. Glaser was in the pharmacy, Mr. Sychak asked Ms. Sychak, ``What's
you intuition?'' and she said, ``I don't know. I think it's okay. Art,
you're not being--everything's okay with you, right?'' to which Mr.
Glaser replied, ``No, my line is good. My lines are clear. I'm
okay.''According to Investigator Dittmer, Mr. Glaser understood Ms.
Sychak to ask if his telephone was being tapped.
When Mr. Glaser left the pharmacy, Mr. Sychak followed him out and
told Mr. Glaser to telephone the pharmacy when he got home and ask
whether it was open on Sundays. Mr. Glaser agreed to do so, and
explained to investigators that he routinely called the pharmacy after
he arrived home and used a code phrase to let Mr. Sychak know that he
had not been stopped by law enforcement personnel who would find the
controlled substances.
Mr. Glaser returned to Medicap Pharmacy on September 22, 1998,
pursuant to an arrangement he made with Mr. Sychak the day before by
telephone. Mr. Glaser was fitted with a recording device and a
transmitter and provided with $2,000 in Government funds. Mr. Glaser
gave Mr. Sychak the $2,000 and some sports trading cards for Mr.
Sychak's son and received in exchange 120 Vicodin ES tablets, 500
alprazolam tablets, and 500 Lorcet tablets. Investigator Dittmer
testified that at some point during the visit, Mr. Sychak told Mr.
Glaser to ``put the word out on the street that Amy is doing--is
selling all these controlled substances.''
On February 16, 1999, Mr. Glaser executed a declaration in evidence
as a Government exhibit. In his declaration Mr. Glaser described his
arrangement with law enforcement authorities and the undercover visits
discussed above. He also stated, among other things, that he and Mr.
Sychak had agreed that Mr. Glaser would purchase Lorcet in 500-tablet
quantities in the original manufacturer's bottles for $1,500 per
bottle. Mr. Glaser further stated that he sold the pills for $4 each to
individuals who would then sell them for $8 each on the street, and
that he also paid Mr. Sychak $5,000 in cash at unstated intervals in
exchange for a shopping bag of Schedule III controlled substances. Mr.
Glaser stated that as of sometime in 1993 he routinely paid Mr. Sychak
$12,000 to $15,000 per transaction and that sometimes Mr. Sychak kept
the pharmacy open late so that Mr. Glaser could make these purchases.
8. The December 16, 1998, Search
As a result of the undercover purchases, investigators obtained a
second search warrant for Medicap Pharmacy and executed it on December
16, 1998. Investigators Conlon and Dittmer and ten to fifteen other law
enforcement officers conducted the search and seized, among other
things, the pharmacy computer's hard drive. That same day, the Deputy
Administrator issued the Order to Show Cause and Immediate Suspension
of Registration that gave rise to the instant proceeding.
9. The Interview of Larry Stepinski
Also on December 16, 1998, Investigators Conlon and Dittmer and
Sergeant Stan King of the Murrysville Police Department interviewed Mr.
Stepinski and videotaped the interview. During the interview, Mr.
Stepinski said that about four years earlier a Robert Mrvos had written
fake prescriptions for Percocet and Didrex, gave them to Mr. Stepinski,
and told him to take them to Medicap Pharmacy to be filled. Mr.
Stepinski said that he told Mr. Mrvos that the prescriptions were for
diametrically opposed drugs, but Mr. Mrvos assured him that Mr. Sychak
would fill both. Mr Stepinski further said that Mr. Sychak filled both
prescriptions.
Mr. Stepinski stated that Mr. Mrvos sent various drug addicts to
Medicap Pharmacy with fake prescriptions; these individuals had the
prescriptions filled and then turned the drugs over to Mr. Mrvos in
exchange for money. According to Mr. Stepinski, however, at some point
Mr. Mrvos was arrested, and Mr. Stepinski obtained the blank
prescription forms that Mr. Mrvos had used. Mr. Stepinski stated that
he wrote the prescriptions for various fictitious people with the last
name Kaczynski, his late uncle's name, because he thought such a name
would be believable inasmuch as it was hard to spell. Mr. Stepinski
also stated that Mr. Sychak filled prescriptions for him for two people
with fictitious last names other than Kaczynski; according to Mr.
Stepinski, he told Mr. Sychak ``they were my neighbors and could you
fill these for me?'' Mr. Stepinski believed, Mr. Sychak knew that these
names were fictitious.
Mr. Stepinski further stated that he forged prescriptions for
Didrex and Percocet using blanks from three different physicians, and
that from time to time Mr. Sychak told him, ``you're going to have to
find a new doctor,'' which Mr. Stepinski interpreted as an instruction
to use a different physican's prescription blank. Mr. Stepinski further
said that Mr. Sychak told him not to present his ``prescriptions'' to
Mr. Werl, because Mr. Werl would call the physician to verify them.
Mr. Stepinski said that he went to the pharmacy every two weeks
with two prescriptions, apparently one for Walter Kaczynski and one for
Linda Kaczynski, and that he obtained Percocet every two weeks and
Didrex once per month. Mr. Stepinski said that about a year after he
started taking the Kaczynski prescriptions to the pharmacy he explained
to Mr. Sychak that many people, himself among them, were using
fictitious names on prescriptions filled at the pharmacy. Mr. Stepinski
further said that as a result of this warning, Mr. Sychak stopped
providing drugs to the people Mr. Stepinski identified, but not to Mr.
Stepinski himself.
Mr. Stepinski said that at one point he used five different
fictitious names on the false prescriptions, but that Mr. Sychak told
him to cut back to two names. Mr. Stepinski further stated that after
the investigation and arrest of a pharmacist at another pharmacy, Mr.
Sychak took him outside the pharmacy building and told him that
Percocet was ``too hot,'' and suggested he obtain Lorcet instead. Mr.
Stepinski said that he told Mr. Sychak he could not switch because he
did not know what instructions to write on a Lorcet prescription, and
Mr. Sychak went back into the building, returned with Mr. Stepinski's
receipt, and wrote the instructions for use for Lorcet on the back. Mr.
Stepinski said that after that conversation he wrote ``prescriptions''
for Lorcet instead of Percocet. Apparently, these were standard
preprinted forms on which Mr. Mrvos forged the physician's signature.
Mr. Stepinski said that he spent about $280 per month for Percocet and
about the
[[Page 75967]]
same amount for Didrex, and that he always paid cash for the drugs.
Counsel for Respondent objected to the introduction into evidence
of the videotape of Mr. Stepinski's interview, asserting that Mr.
Stepinski was not subject to cross examination, and that Mr. Stepinski
may have had reason to cast Mr. Sychak in an unfavorable light. Judge
Bittner found, however, and the Deputy Administrator agrees, there is
other credible evidence from the hospital where Dr. Fennema had worked
and also Investigator Conlon's report of his conversation with Dr.
Fennema, that the Kaczynskis were fictitious. In these circumstances,
the inference is warranted, which Judge Bittner made, and with which
the Deputy Administrator concurs, that none of the deliveries to them
were authorized. Judge Bittner also noted that Respondent adduced no
evidence that Mr. Sychak made any attempt to verify any of the
purported prescriptions to them.
The Deputy Administrator may revoke a DEA Certificate of
Registration and deny any pending applications for such a certificate
``if he determines that the issuance of such registration would be
inconsistent with the public interest'' as determined pursuant to 21
U.S.C. 824(a)(4) an 823(f). 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 and
safety.
As a threshold matter, the factors specified in section 823(f) are
to be considered in the disjunctive: the Deputy Administrator may
properly rely on any one or a combination of those factors, and give
each factor the weight he deems appropriate, in determining whether a
registration should be revoked or an application for registration
denied. Henry J. Schwarz, Jr., M.D., 54 FR 16,422 (DEA) 1989).
The Controlled Substances Act further prohibits dispensing a
Schedule II controlled substance without the written prescription of a
practitioner, with certain exceptions not pertinent here. 21 U.S.C.
829(a) (1996).
The Act also prohibits dispensing a Schedule III or IV controlled
substance ``without a written or oral prescription in conformity with
[the Federal Food, Drug and Cosmetic Act,'' 21 U.S.C. 829(b) (1996).
Furthermore, the relevant regulations governing prescriptions and
implementing the Controlled Substances Act, 21 CFR 1306.03 through
1306.06 (1999) provide, in relevant part, that: (1) Prescriptions for
controlled substances may be issued only by an individual practitioner
who is authorized to prescribe these medications by the jurisdiction in
which he is licensed to practice his profession and is registered by
DEA or exempt from such registrations; (2) a prescription for a
controlled substance must be issued for a legitimate medical purpose by
an individual practitioner acting in the usual course of his
professional practice; (3) although a prescribing practitioner is
responsible for the proper prescribing and dispensing of controlled
substances, ``a corresponding responsibility rests with the pharmacist
who fills the prescription,'' (4) prescriptions for controlled
substances must be rated as of and signed on the day issued and must
bear the full name and address of the patient, the drug name, strength,
dosage form, quantity prescribed, and directions for use, as well as
the name, address, and DEA registration number of the practitioner; and
(5) prescriptions for controlled substances may be filled only by a
pharmacist acting in the usual course of his professional practice.
The Government argues, in substance, that Mr. Sychak filled
fictitious and fraudulent prescriptions, delivered controlled
substances without a prescription, provided controlled substances in
exchange for stolen drug samples, added unauthorized refills to
prescriptions, encouraged drug abusers to place fraudulent telephone
calls purportedly authorizing dispensings, falsified insurance records,
and made misrepresentations to investigators. The Government further
argues that even if Mr. Sychak and Medicap Pharmacy could be considered
the victims on occasion of stratagems by drug-seeking individuals who
presented fraudulent prescriptions or posed as physicians, the pharmacy
abrogated its obligation to ensure that it filled only lawful
prescriptions.
As noted above, Respondent did not file proposed findings of fact,
conclusions of law or argument in this proceeding. In his closing
argument at the hearing, counsel for Respondent asserted, in substance,
that much of Ms. Ruffner's testimony was hearsay and she had reason to
fabricate her testimony; the Government did not offer into evidence the
tape recordings of the undercover visits; Respondent was not afforded
the opportunity to cross-examine Mr. Stepinski or the other informants;
and the Government did not conduct a full audit of the pharmacy. In
sum, Respondent argues that the Government has not met its burden of
proof in this proceeding.
With regard to factor one of the public interest analysis pursuant
to 21 U.S.C. 824(a)(4) and 823(f), the recommendation of the State
licensing board, it is undisputed that at the time of the hearing
Respondent was authorized by the Commonwealth of Pennsylvania to handle
controlled substances. Inasmuch as State licensing is a necessary but
not sufficient condition for DEA registration, however, Judge Bittner
found, and the Deputy Administrator concurs, that this factor is not
determinative.
With regard to factor two, Respondent's experience in handling
controlled substances, Judge Bittner made the following factual
findings, with which the Deputy Administrator concurs. The stated
quantities of illicitly dispensed controlled substances are based upon
the evidence of the record as a whole. The Deputy Administrator
recognizes that Respondent's computer logs may not have been entirely
accurate. Testimony and other evidence, however, such as the fraudulent
prescriptions themselves, paint a fairly complete picture of the
magnitude of illicit activity encouraged and abetted by Respondent. It
is highly doubtful, moreover, that Respondent would have overstated in
his computer logs the quantities of controlled substances he was
illegally dispensing.
a. The Deliveries to Mr. Ray
On August 8, 1997, Mr. Sychak delivered sixty hydrocodone 7.5 mg to
Mr. Ray pursuant to the fictitious oral authorization of Dr. Wigle.
Although that ``authorization'' specified no refills, Respondent's
memorialization of it lists one refill. Mr. Sychak in fact treated that
``authorization'' as if it provided for two refills, delivering
hydrocodone to Mr. Ray on August 15, and August 22, 1997. On August 29,
1997, Mr. Sychak refused to provide drugs based on the blank
prescription from the fictitious Dr. Beck, but based that refusal on
his concern that DEA investigators might notice that the handwriting on
the filled-out prescription was the same as that on other pharmacy
records. When Mr. Ray returned to the pharmacy shortly thereafter with
the same form filled out
[[Page 75968]]
for sixty Percocet, however, Mr. Sychak honored it.
On September 5, 1997, Mr. Sychak delivered Percocet to Mr. Ray
after he filled out the ``prescription'' in Mr. Sychak's presence, and
also provided Mr. Ray with sixty hydrocodone pursuant to another
fictitious authorization from Dr. Beck. A week later, Mr. Sychak again
provided hydrocodone to Mr. Ray pursuant to a fictitious authorization
from Dr. Beck.
b. The Deliveries to Mr. Stepinski
The record establishes that between January 2, 1997, and April 14,
1998, Mr. Sychak delivered 2,870 Percocet, 60 Roxicet, 4,310 Didrex 50
mg., and 360 Lorcet 10/650 to Mr. Stepinski using the names of various
Kacyznskis as aliases. The record also establishes that these
deliveries were made pursuant to fictitious ``prescriptions'' and that
Mr. Sychak was aware that these were not bona fide dispensings.
c. The Deliveries to Lynette Reffner and Michael Riley
Between July 17, 1997, and December 30, 1997, Respondent delivered
to Ms. Reffner a total of 1,620 dosage units of Vicodin; 715 dosage
units of hydrocodone; 164 dosage units of Hydromet syrup; 60 dosage
units of phenobarbital; 1,390 dosage units of alprazolam; 1,240 dosage
unit of Ap-Oxazepam; 130 dosage units of diazepam; and 100 dosage units
of Darvocet. From 1994 until 1998 Ms. Reffner and Mr. Riley regularly
purchased Vicodin ES, Xanax, Darvocet, Soma, and Hydromet syrup from
Mr. Sychak without a prescription or any other form of physician
authorization.
d. The Deliveries to the Ruffners
The record establishes that Mr. Sychak provided controlled
substances to Ms. Ruffner's mother in exchange for physician samples of
other drugs, delivered drugs to Ms. Ruffner and to her mother pursuant
to purported telephone authorizations he knew to be fictitious,
provided Ms. Ruffner more refills than the written legitimate
prescriptions authorized, and sold controlled substances to Ms. Ruffner
on the basis of lists she gave him containing names of persons and
drugs, without any physician authorization. Mr. Sychak also provided
Mr. Ruffner a fraudulent prescription vial at the latter's request.
Respondent unlawfully delivered controlled substances to the Ruffners
for several years. Between July 1996 and April 1998, Respondent
delivered to the Ruffners 18,031 Vicodin ES 7.5; 9,165 hydrocodone with
APAP 7.5; 8,425 hydrocodone 10 with APAP 650; 2,990 Lorcet 10/650;
2,640 diazepam 10 mg.; 330 Fioricet with codeine No. 3; 90 Lomotil and
Lonox; 4,080 milliliters of Hydromet syrup, and 390 Prelu-2 105 mg.
There is no indication that any of these deliveries were pursuant to
legitimate prescriptions or other physician authorizations. Karen
Ruffner additionally received 60 dosage units of Vicodin ES in March
and April of 1993 pursuant to a purported prescription issued by Dr.
Dzialowski. Finally, during Ms. Ruffner's undercover visit on April 24,
1998, Mr. Sychak sold her generic hydrocodone, without a prescription
and upon her giving him a list of people and drug names.
e. The Deliveries to Mr. Glaser
Mr. Glaser stated in his February 1999 declaration that he had
purchased Lorcet and other Schedule III controlled substances from Mr.
Sychak since 1993, and that he paid $3.00 per pill for Lorcet. The
record establishes that between November 1993, and March 1997
Respondent delivered to Mr. Glaser a total of 12,030 dosage units of
alprazolam 2 mg.; 360 dosage units of diazepam 10 mg.; 13,980 dosage
units of Lorcet; 420 dosage units of Vicodin ES 7.5; 60 hydrocodone 7.5
with APAP; 12,080 milliliters of Tussionex Pennkinetic suspension; 60
phentermine 37.5 mg.; and 240 Xanax 2 mg. It is also noteworthy that
Respondent delivered to Mr. Glaser 300 Vicodin in a six-week period in
1994, and 240 Xanax in a three-week period in 1995. Furthermore, as
described above, in the course of the two undercover visits in
September 1998, less than five months after execution of the April 24
search warrant, Mr. Sychak sold Mr. Glaser 1,000 alprazolam; 140
Vicodin; 1,000 Lorcet; and 60 generic hydrocodone, for a total of
$4,000.
Judge Bittner found, and the Deputy Administrator concurs, that the
record establishes that over a period of about six years Mr. Sychak
sold tens of thousands of dosage units of controlled substances without
a physician's authorization. The record further establishes that Mr.
Sychak knew or should have known that he was delivering these
medications to persons who were drug abusers themselves and/or who were
providing the controlled substances to others who were. Judge Bittner
found, and the Deputy Administrator concurs, that this factor weighs in
favor of a finding that Respondent's continued registration would be
inconsistent with the public interest.
With regard to factor three, Respondent's conviction record
relating to controlled substances, there is no evidence that either
Medicap Pharmacy or Mr. Sychak has been convicted of violating any laws
relating to controlled substances at the time of the hearing.
With regard to factor four, Respondent's compliance with applicable
laws relating to controlled substances, the record establishes that Mr.
Sychak delivered tens of thousands of dosage units of controlled
substances without complying with the statutory and regulatory
provisions discussed above. Judge Bittner therefore found, and the
Deputy Administrator concurs, that this factor weighs in favor of a
finding that Respondent's continued registration would be inconsistent
with the public interest.
Finally, with regard to the fifth factor, other conduct that may
threaten the public health and safety, Judge Bittner found, and the
Deputy Administrator concurs, that Mr. Sychak (1) acquiesced to Mr.
Ruffner's request to provide a fraudulent prescription vial; (2)
provided Percocet to Mr. Ray pursuant to a fictitious prescription that
Mr. Ray filled out in front of him; (3) offered to bill Ms. Reffner's
phenobarbital to another patient's medical insurance; (4) exchanged
controlled substances for stolen physician samples of other drugs; (5)
continued to fill false prescriptions after Mr. Werl warned him that
they were fraudulent; (6) misrepresented to investigators that he had
contacted Dr. Beck to verify a prescription; and (7) billed insurance
carriers for drugs the policyholders did not receive. Judge Bittner
therefore found, and the Deputy Administrator concurs, that this factor
weighs in favors of a finding that Respondent's continued registration
would be inconsistent with the public interest.
Judge Bittner found, and the Deputy Administrator concurs, that it
is abundantly clear that Mr. Sychak has egregiously abused his
privilege to handle controlled substances. It appears from the record
that Mr. Sychak was purposefully attempting to engender addiction
through his unauthorized dispensing of refills, apparently hoping to
profit from the illicit market for controlled substances he thereby
created. There is no exculpatory evidence to explain why Mr. Sychak
acted as he did, that he regrets his actions, or that he will not
repeat them in the future. In these circumstances the conclusion is
appropriate that Respondent's continued registration with DEA would be
inconsistent with the public interest. See Singers-Andreini Pharmacy,
Inc., 53 FR 4668, 4672 (DEA 1998); Gerald M. Bluestone, R.Ph., d/b/a
Bluestone Drug Store, 56 FR
[[Page 75969]]
16114, 16116 (DEA 1991); Arthur Sklar, R.Ph., d/b/a King Pharmacy, 54
FR 34623 (DEA 1989).
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 the DEA
Certificate of Registration BM2751736, issued to Medicap Pharmacy, be,
and hereby is, revoked, and any pending applications for renewal of
such registration be denied. This order is effective January 4, 2001.
Dated: November 21, 2000.
Julio F. Mercado,
Deputy Administrator.
[FR Doc. 00-30930 Filed 12-4-00; 8:45 am]
BILLING CODE 4410-09-M