[Federal Register Volume 78, Number 35 (Thursday, February 21, 2013)]
[Notices]
[Pages 12092-12101]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-03879]


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DEPARTMENT OF JUSTICE

Drug Enforcement Administration

[Docket No. 11-10]


John V. Scalera; Decision and Order

    On November 17, 2010, the Deputy Assistant Administrator, Office of 
Diversion Control, Drug Enforcement Administration, issued an Order to 
Show Cause to John V. Scalera, M.D. (hereinafter, Respondent), of 
Northfield, New Jersey. The Show Cause Order proposed the denial of 
Respondent's application for a DEA Certificate of Registration as a 
practitioner, on the ground that his ``registration would be 
inconsistent with the public interest.'' ALJ Ex. 1, at 1.
    The Show Cause Order specifically alleged that Respondent had 
previously held a DEA registration, which, on February 23, 2009, he 
voluntarily surrendered for cause. Id. The Order alleged that 
Respondent had written

[[Page 12093]]

prescriptions in the name of his deceased mother-in-law for oxycodone 
and Percocet, both of which are schedule II controlled substances, 
which he personally filled ``at numerous pharmacies.'' Id. The Order 
further alleged that this conduct had occurred since March 4, 2003, and 
was in violation of 21 U.S.C. 841(a) and state law. Id.
    Next, the Show Cause Order alleged that ``[f]rom June 3 * * * 
through July 11, 2009,'' Respondent had written ``at least nine 
prescriptions for [t]ramadol, or its trade name Ultram, in the name of 
[his] daughter,'' and that he ``did not conduct an examination which 
was properly documented in her patient record in violation of'' the New 
Jersey Administrative Code. Id. at 2. The Order further alleged that he 
had ``personally filled these prescriptions at * * * five different 
pharmacies'' and had written ``most, if not all, of [them] to support 
[his] drug habit.'' Id. The Order then alleged that this conduct 
violated various provisions of New Jersey law. Id.
    Finally, the Show Cause Order alleged that ``[o]n June 16, 2009, an 
employee of [Respondent's] office called in a prescription for 
[t]emazepam, a [s]chedule IV controlled substance, in the name of [his] 
daughter using'' the DEA number he had previously surrendered. Id. The 
Order further alleged that this prescription ``was refilled on July 14, 
2009[,]'' and that Respondent's ``prescribing of this controlled 
substance'' violated 21 U.S.C. 822 and 841(a) and 21 CFR 1301.11 and 
1301.13. Id.
    Respondent requested a hearing on the allegations and the matter 
was placed on the docket of the Office of Administrative Law Judges 
(ALJ). Thereafter, an ALJ proceeded to conduct pre-hearing procedures, 
during which the Government raised additional allegations that 
following the voluntary surrender of his registration, Respondent 
issued prescriptions and hospital orders for controlled substances. 
More specifically, the Government alleged that Respondent: (1) Issued 
four prescriptions for diazepam, a schedule IV controlled substance, in 
the name of his wife, ``which were filled from March 11 * * * through 
June 17, 2009''; (2) issued at least nine prescriptions for Androgel 
(testosterone), a schedule III controlled substance, in both his own 
name and that of another person, which ``were filled from July 16, 2009 
through April 19, 2010''; 3) issued ``[a]t least ten prescriptions for 
[t]emazepam * * * in the names of [his] daughter and [his former] son-
in law, [which] were filled from March 18 * * * through May 24, 2009''; 
and 4) ``continued to issue orders for controlled substances [including 
morphine, hydromorphone, oxycodone, hydrocodone, meperidine, 
alprazolam, clonazepam, and zolpidem] for patients he was treating at 
AtlantiCare Regional Medical Center.'' ALJ Ex. 7, at 1-2. The 
Government further alleged that Respondent's conduct violated 21 U.S.C. 
841(a)(1) and 843(a)(2) & (3). Id. at 2.
    On May 3-5, 2011, the ALJ conducted a hearing at which both parties 
called witnesses to testify and submitted various exhibits into the 
record. Following the hearing, both parties submitted briefs containing 
their proposed findings of fact and conclusions of law.
    Thereafter, the ALJ issued her recommended decision. Therein, the 
ALJ applied the five public interest factors and found that while the 
``[d]enial of the Respondent's application can be justified by this 
record,'' recommended that ``a less severe action be taken in this 
case'' and that Respondent be granted a new registration subject to 
various conditions. ALJ at 28.
    With respect to factor one--the recommendation of the State 
licensing board--the ALJ noted that the board had elected not to take 
``adverse action'' against Respondent upon learning that he was writing 
tramadol prescriptions for both himself and his daughter and had 
ordered him ``to cease all self-prescribing and prescribing for his 
daughter's pain issues'' but had otherwise placed no restrictions on 
his medical practice. Id. at 23. The ALJ further noted that the Board 
was actively monitoring Respondent's recovery from drug addiction, that 
Respondent was required to participate in drug screening and that if 
Respondent had an ``illegitimate positive urine test result,'' his 
license was subject to suspension. Id. The ALJ thus concluded ``that 
the Board's recommendation, in light of the overlapping facts it 
considered, weighs in favor of the Respondent's registration.\1\'' ALJ 
at 23-24.
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    \1\ The ALJ also found that Respondent has not been convicted of 
any offense related to the handling of controlled substances (factor 
three). ALJ at 25-26.
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    Next, the ALJ considered factors two and four--the applicant's 
experience in dispensing controlled substances and compliance with 
applicable laws related to controlled substances. Id. at 24-26. Here, 
the ALJ found that prior to surrendering his registration in February 
2009, Respondent wrote prescriptions for controlled substances in the 
name of his deceased mother-in-law for his own use. Id. at 24. 
Moreover, the ALJ found that following the surrender of his 
registration, Respondent prescribed testosterone to both himself and 
one of his patients. Id.
    The ALJ further found that following the surrender of his 
registration, Respondent wrote hospital orders for controlled 
substances for inpatients that he was treating. Id. Regarding these 
violations, the ALJ further noted that ``[w]hen asked if he had 
consciously violated his lack of DEA registration, unfortunately the 
Respondent denied that violation * * * explain[ing] that he thought he 
was acting under the auspices of the hospital.'' Id. at 24-25.
    Finally, the ALJ found that ``Respondent failed to adequately 
supervise his staff and their placement of phone-in and fax-in 
prescriptions for controlled substances.'' Id. at 25. While the ALJ 
found that ``[t]he majority of these prescriptions were initially 
phoned in while the Respondent was receiving inpatient treatment'' and 
``it credible that [he] did not place phone-in orders for controlled 
substances during that time,'' she further found that he ``left his 
prescription pads with his controlled substances registration number at 
the office during his absence.'' Id. Noting that Respondent's failure 
to safeguard his registration ``is not conduct indicative of a 
responsible registrant,'' as well as Agency precedent that ``[w]rongful 
conduct by the registrant's agent is imputed to the registrant,'' the 
ALJ concluded that he was responsible for the phoned and faxed-in 
prescriptions. Id. The ALJ thus held that factors two and four provided 
grounds to deny Respondent's application.
    As for factor five--such other conduct which may threaten public 
health and safety--the ALJ cited several findings. More specifically, 
the ALJ noted Respondent's history of drug addiction which included two 
relapses, ``his pattern of prescribing medications for family members 
and then consuming them himself [which] continued with [his] 
prescribing of [t]ramadol for his daughter and then consuming some of 
the medication himself,'' and his having lied to a DEA agent when he 
denied that he was consuming the tramadol which he prescribed for his 
daughter. Id. at 26. The ALJ concluded that this conduct ``is not 
consistent with the responsibilities of a DEA registrant.'' Id.
    However, the ALJ then noted Respondent had presented evidence of 
mitigating circumstances. This evidence included that he was actively 
participating in his recovery, and that a

[[Page 12094]]

treating professional with the State's Professional Assistance Program 
(PAP), who has worked with him for two years, had credibly testified 
that Respondent is in ``sustained full remission.'' Id. at 27.
    In addition, the ALJ found that Respondent acknowledged his 
wrongdoing in prescribing testosterone. Id. Finally, the ALJ found that 
Respondent had provided various assurances of his future compliance 
including that ``he would no longer allow his staff to phone in or fax 
in prescriptions for controlled substances'' and that ``his daughter 
would no longer work in his office.'' Id. Also, Respondent acknowledged 
that DEA ``might want to obtain more oversight of the Respondent's 
handling of controlled substances.'' Id.
    The ALJ thus recommended that Respondent be granted a restricted 
registration. The Government filed exceptions to the ALJ's decision and 
Respondent filed a response to the exceptions. Thereafter, the record 
was forwarded to my office for Final Agency Action.
    Having considered the entire record including the parties' 
submissions and the ALJ's recommended decision, I agree with the ALJ's 
conclusion that grounds exist to deny Respondent's application. 
However, I disagree with the ALJ's recommendation that I grant 
Respondent's application because he has failed to acknowledge his 
misconduct with respect to most of the violations proved on this record 
and failed to demonstrate that he can be entrusted with a new 
registration. I make the following findings of fact.

Findings

    Respondent is a medical doctor who is board certified in urology. 
RX 3, at 2. Respondent has been licensed by the New Jersey State Board 
of Medical Examiners since 1981; Respondent currently holds an active 
license. Id.
    Respondent formerly held a DEA Certificate of Registration, which 
authorized him to dispense controlled substances as a practitioner. GX 
9. However, on February 20, 2009, DEA Diversion Investigators (DIs) 
interviewed Respondent regarding information that he was writing 
prescriptions in the name of his deceased mother-in-law (who had died 
in May 2002) for Percocet and Roxicodone, both of which are schedule II 
narcotic controlled substances which contain oxycodone. GX 18, at 2; 
GXs 4 and 8. According to the evidence, Respondent began writing these 
prescriptions on approximately March 4, 2003 and continued doing so 
until shortly before the interview. GX 18, at 2; GX 4. During the 
interview, Respondent admitted that he wrote the prescriptions to 
obtain the narcotics for his own use. GX 18, at 2. Respondent denied 
selling or giving the drugs to anyone else. Id.
    During the interview, Respondent executed a voluntary surrender 
form (DEA-104) for his DEA registration. Id.; see also GX 9. Among 
other things, the form stated: ``I understand that I will not be 
permitted to order, manufacture, distribute, possess, dispense, 
administer, prescribe, or engage in any other controlled substances 
activities whatever, until such time as I am again properly 
registered.'' GX 9. On or about June 3, 2009, Respondent submitted an 
application for a new registration. GX 18, at 2.
    On March 2, 2009, Respondent re-entered the ARP \2\ with a 
diagnosis of opiate dependence.\3\ RX 8, at 5. According to a follow-up 
report, Respondent had previously been in the ARP but ``had relapsed 
into the use of Oxycodone and has been unable to discontinue use.'' Id. 
Respondent ``was advised to stop practice[ing] immediately'' and was 
``referred to inpatient treatment at Behavioral Health of the Palm 
Beaches.'' Id.
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    \2\ The ``ARP'' or ``Alternative Resolution Program'' is a 
program established ``for those subject to Board jurisdiction who 
are suffering from chemical dependencies and other impairments which 
shall permit such licensees to disclose their status to an entity 
which would allow for confidential oversight.'' N.J. Admin. Code 
13:35-11-1.
    \3\ Respondent had previously entered the ARP on May 21, 1997 as 
``a self-referral * * * because of [his] intermittent use of 
codeine-containing cough syrups over the course of approximately 
eight years and [his] consuming approximately a pint a day.'' RX 8, 
at 13. Respondent also testified that he had been enrolled in the 
Professional Assistance Program from 1978 to either 1983 or 1985. 
Tr. 253. After giving this testimony, Respondent was asked ``[w]ere 
there other times that you were enrolled as well?'' Id. Respondent 
answered ``no,'' id., notwithstanding the other documentary evidence 
establishing that he enrolled in the program in May 1997.
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    Respondent was an in-patient at Behavioral Health of the Palm 
Beaches ``from 3/2/09 till 4/3/09.'' RX 11, at 1. During the initial 
phase of this treatment, Respondent was unable to make telephone calls. 
Tr. 385. Moreover, while thereafter Respondent was allowed to make 
phone calls, any calls would have been monitored. Id.
    Respondent successfully completed the inpatient treatment and was 
discharged. Tr. 255, RX 11, at 1. Thereafter, Respondent has been 
involved in weekly 12-step recovery meetings, sessions with a 
psychologist, meetings with both a Professional Assistance Program 
(PAP) monitor (every other month) and the program's chairman (once a 
quarter), and random urine drug screens (UDSs). RX 11, at 1; RX 8, at 
3. For the first year following the completion of his inpatient 
treatment, Respondent was subject to twice weekly UDSs, followed by 
weekly UDSs for the second year, and is now subject to twice-monthly 
screening. RX 11, at 1. Respondent has not tested positive for any non-
prescribed drug, but has tested positive for tramadol. RX 13. Moreover, 
according to the Assistant Director of the PAP, Respondent is in 
``sustained full remission.'' Tr. 388.
    Following the receipt of Respondent's application, DEA DIs received 
information from a pharmacist that Respondent was writing prescriptions 
for tramadol \4\ in the name of his daughter; however, Respondent 
brought the prescriptions to the pharmacy and filled them. GX 18, at 3. 
Making inquiries to other area pharmacies, the DIs determined that in 
one six-week period during June and July 2009, Respondent had written 
ten tramadol prescriptions in his daughter's name for a total of 810 
dosage units; the prescriptions were filled at six different 
pharmacies. Id. at 3; see also GX 11.\5\
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    \4\ While tramadol (ULTRAM) is not a controlled substance, the 
FDA now requires that its label include the following statement:
    ULTRAM may induce psychic and physical dependence of the 
morphine-type ([mu]-opioid). Dependence and abuse, including drug-
seeking behavior and taking illicit actions to obtain the drug are 
not limited to those patients with prior history of opioid 
dependence. The risk in patients with substance abuse has been 
observed to be higher. ULTRAM is associated with craving and 
tolerance development. Withdrawal symptoms may occur if ULTRAM is 
discontinued abruptly.
    GX 16, at 1.
    \5\ Many of the prescriptions include the notation ``PRN Pain.'' 
GX 11.
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    On July 21, 2009, two DIs and a State Investigator met with 
Respondent at his office and questioned him about the tramadol 
prescriptions. Id. at 4. During the interview, Respondent admitted that 
he had written the prescriptions for his daughter claiming they were 
for an injury; but while Respondent had a patient file for his 
daughter, the file ``did not show his prescribing of any tramadol to 
her.'' Id. Respondent further admitted that he had picked up the 
prescriptions at the pharmacies but said he did so routinely. Id.
    While she was still at Respondent's office, the DI called 
Respondent's daughter who stated that she had received only a single 
tramadol prescription from her father which she had refilled two times. 
Id. Upon being told by the DI that his daughter had ``only confirmed 
receipt of one of the numerous [t]ramadol prescriptions in question,'' 
Respondent ``stated that his daughter must be mistaken and that she

[[Page 12095]]

received all of the prescriptions he wrote for her.'' Id. at 5. 
Respondent further maintained that ``he did not ingest any of the 
[t]ramadol himself.'' Id. Respondent ``stated that he would not write 
any more [t]ramadol prescriptions for his family members'' and 
reiterated that he was not diverting the drug for himself. Id.
    Thereafter, the DI notified Dr. Baxter, the PAP's Executive Medical 
Director regarding Respondent's use of tramadol. Id. The Executive 
Director told the DI that Respondent needed to get permission from the 
PAP to be prescribed tramadol and that he would speak with Respondent. 
Id. In a subsequent phone conversation, the Executive Director told the 
DI that Respondent had ``admitted that he had used the [t]ramadol that 
he obtained by writing prescriptions in his daughter's name.'' Id. 
However, at the hearing, Respondent testified that while he picked up 
some of the tramadol prescriptions he issued for his daughter, he 
``never used [t]ramadol written in [his] daughter's name.'' Tr. 323.
    On July 31, 2009, Dr. Baxter wrote a letter to the Executive 
Director of the State Board of Medical Examiners. RX 8, at 16. Therein, 
Dr. Baxter reported that he had confronted Respondent about his writing 
tramadol prescriptions in his daughter's name and his positive UDSs for 
tramadol. Id. Dr. Baxter wrote that Respondent had stated ``that he 
`did not know that he could not use [t]ramadol since it was not a 
controlled substance.''' Id. Dr. Baxter further wrote that Respondent's 
daughter had ``initially confirmed that he had written her one 
prescription and later said that there were more'' and that Respondent 
``dispute[s] the number of prescriptions that the DEA reported.'' Id. 
Dr. Baxter also wrote that he ``admonished [Respondent] for self-
prescribing'' and that Respondent was told ``to get his treating 
physician . . . to write any future prescriptions.'' Id. Finally, Dr. 
Baxter wrote that Respondent had yet to start therapy with a 
psychologist and that he was instructed to do so ``immediately.'' Id.
    Several weeks later, the DI received information from a pharmacy 
that Respondent was receiving tramadol prescriptions from two different 
physicians (Dr. M. & Dr. C.).\6\ GX 18, at 5-6. In his testimony, 
Respondent acknowledged that he had received tramadol prescriptions 
from both Dr. C. and Dr. M. Tr. 259-64. According to Respondent, Dr. C. 
is an orthopedic surgeon who treated him for a back injury he suffered 
in a January 2008 motor vehicle accident and who had prescribed the 
tramadol to him to treat his back pain. Id. at 259-60, 262, 316. 
Respondent also testified that eight months after the accident, he was 
walking with a cane and tripped, breaking his hip, thus requiring hip 
replacement surgery. Id. at 317; RX 11, at 1. Respondent testified that 
Dr. M. was treating him for his hip and prescribed the tramadol for 
that purpose.\7\ Id. at 263-64.
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    \6\ According to the DI's affidavit, she met with one of the 
physicians, Dr. M., who acknowledged writing a prescription for 200 
dosage units because Respondent claimed he was having insurance 
issues; Dr. M. further stated that he did not know that Respondent 
was also seeing another physician. GX 18, at 6. Id. The DI then 
called Dr. C., who confirmed that Respondent was his patient and 
that he had written him a prescription for tramadol. Id. The DI's 
statement does not address whether she asked Dr. C. if he knew 
Respondent was being treated by Dr. M. Id.
    While Dr. M.'s statement, which apparently was unsworn, that he 
had written a prescription for 200 dosage units is corroborated by 
other evidence, see GX 14, there is no evidence corroborating his 
statement that he did not know that Respondent was seeing another 
physician. Dr. C.'s statements that Respondent was his patient and 
that he had written him a tramadol prescription was corroborated by 
Respondent's testimony and documentary evidence. See GX 13; Tr. 259-
60.
    \7\ Subsequently, Respondent appeared before the New Jersey 
Board's Preliminary Evaluation Committee to discuss his ``positive 
urine screens for Ultram [tramadol] and to discuss prescriptions 
issued in the name of his daughter.'' RX 8. Subsequently, the Board 
permitted Respondent ``to remain in the ARP'' and asked the Director 
of the PAP ``to enter into a new agreement with [Respondent] which 
makes clear that he must notify [the PAP] of all of his treating 
physicians, as well as any medications he ingests pursuant to 
prescription.'' Id. at 1.
    The Committee also noted that it had discussed with Respondent 
``the prescriptions written by him for his daughter'' and that it 
``was troubled that [he] did not appear to keep routine medical 
records for family members.'' Id. at 8. However, ``[t]he Board 
accepted the Committee's representation that [Respondent] is now 
aware of the need to maintain such records.'' Id.
    Moreover, according to the Assistant Director of the PAP, the 
Board and the PAP ``are in agreement that [the] monitoring protocol 
is an effective way of monitoring his recovery as well as protecting 
the public safety'' and ``[t]he Board has also determined not to 
restrict his prescribing privileges (other than for himself and 
family members).'' RX 11, at 2.
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    On September 23, 2009, the DIs went to Respondent's office to ask 
him to withdraw his application. GX 18, at 6. Respondent declined to do 
so and again stated that he had not used any of the tramadol he 
prescribed for his daughter. Id. Respondent's daughter was also present 
and stated that she was now receiving tramadol from another physician, 
and that she was ``trying to get off of Percocet.'' Id.
    On December 14, 2009, the DIs, accompanied by the Resident Agent in 
Charge, again met with Respondent at the local DEA office. Id. During 
this interview, Respondent was asked ``if the Percocet he previously 
diverted under [his late mother-in-law's name] was for himself or his 
daughter?'' Id. at 7. Respondent stated ``that 60 percent was for him, 
and 30 percent was for his daughter, but * * * then recanted and said 
that all of the Percocet he diverted was for himself.'' Id. Respondent 
then stated that he had misunderstood the question and that the above 
percentages referred to the tramadol prescriptions he had written. Id. 
As found above, in the July 21 as well as September 23 interviews, 
Respondent had denied ingesting any of the tramadol. Id. at 5-6. 
Moreover, at the hearing, Respondent testified that when the DI asked 
him whether he had diverted the tramadol prescriptions issued in his 
daughter's name, his ``answer was why would I divert something like 
that when I get it from my own doctor.'' Tr. 304. And when asked if he 
had admitted to Dr. Baxter (the PAP Medical Director) that he had used 
some of the tramadol obtained from the prescriptions he issued in his 
daughter's name, Respondent testified: ``I never used [t]ramadol 
written in my daughter's name.'' Id. at 323. However, as did the ALJ, I 
find that Respondent wrote prescriptions in his daughter's name for 
tramadol to obtain the drug for his personal use. ALJ at 10.
    During the December 2009 interview, the DI asked Respondent whether 
his daughter had a drug problem; Respondent stated ```yes''' but that 
``she was doing better.'' GX 18, at 7. Respondent admitted that he had 
not previously told investigators about his daughter's drug problem and 
stated that ``he did not realize how bad his daughter's problem was 
until he got out of drug rehabilitation himself and became sober.'' Id. 
Respondent further stated that he had prescribed tramadol for his 
daughter to help her get off of Percocet. Id. However, previously, 
Respondent had stated that he had prescribed the tramadol to her for an 
injury. Id. One of the DIs then told Respondent that he was not 
authorized to prescribe controlled substances for addiction 
treatment.\8\ Id.
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    \8\ One of the DIs interviewed Respondent's daughter, who had 
come with him to the DEA office. GX 18, at 7. She denied having 
previously told the DI that she had not received all of the tramadol 
prescriptions and asserted that she had taken all of the tramadol 
her father had prescribed. Id. at 8.
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    Several days later, the DI and a Special Agent went to a Rite Aid 
pharmacy in Northfield, New Jersey and spoke with the pharmacist about 
two prescriptions for temazepam which were authorized for Respondent's 
daughter. Id. at 8. The pharmacist stated

[[Page 12096]]

that on June 16, 2009, Linda, an employee in Respondent's office, had 
called in a temazepam prescription for his daughter with three refills. 
Id. This statement is corroborated by a Telephone Prescription Order 
dated ``6/16/09'' for 60 temazepam 30mg, with three refills, listing 
Respondent's daughter as the patient, Respondent as the prescriber, and 
noting that the prescription was ``phoned in by Linda.'' GX 33, at 3. 
According to a Physician's Activity Report compiled by the pharmacy, 
both the prescription and a refill of it were dispensed, the latter 
occurring on July 14, 2009. GX 33, at 1; see also GX 22, at 4.
    In addition, another Physician's Activity Report for Respondent 
lists a prescription for 60 tablets of temazepam 15mg (46128) 
issued for his daughter which was refilled on March 5 and 30, 2009, as 
well as a new prescription for 30 tablets of temazepam 30mg 
(55132) which was issued on April 27 and refilled on May 24, 
2009. GX 32, at 1. The latter prescription was phoned in and has the 
notation ``Linda'' written on top.\9\ Id. at 2.
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    \9\ On April 27, 2009, the same day, another prescription (for 
tramadol) was called in to a CVS Pharmacy by ``Linda'' for 
Respondent's daughter. GX 10, at 1.
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    On March 9, 2011, a DI sought additional records from both CVS and 
Rite Aid for the period beginning on February 20, 2009, the date on 
which Respondent had surrendered his registration. GX 24. These records 
showed that on March 11, 2009, a prescription for Respondent's wife was 
called into a CVS Pharmacy (located in Somers Point, NJ) for 30 
diazepam; this prescription was refilled on March 30, May 19, and June 
17, 2009. Id. at 2. The records from Rite Aid also showed both the 
April 27 and June 16, 2009 prescriptions for temazepam for Respondent's 
daughter. Id. at 3-4.
    The records further showed that on March 18, 2009, a prescription 
for Respondent's former son-in-law was called into a CVS (located in 
Ventnor, NJ) for 60 temazepam; this prescription was refilled on April 
15, May 12, and June 9, 2009. Id. at 3. Also, on July 6, 2009, an 
additional prescription for 60 temazepam for Respondent's son-in-law 
was faxed in to the same pharmacy by R.M., an employee of Respondent; 
this prescription was refilled on August 30, 2009. Id. at 3; see also 
GX 26.
    Next, various records show that Respondent issued prescriptions for 
Androgel (testosterone), a schedule III controlled substance, for both 
D.S., who was a patient, and for himself. GX 24, at 2. Respondent wrote 
the first prescription for D.S. on July 16, 2009; this prescription was 
refilled on August 10, 2009. Id. Respondent wrote the second 
prescription for D.S. on September 10, 2009; this prescription was 
refilled on October 17 and November 27. Id.
    Respondent called in the first Androgel prescription for himself on 
July 12, 2009. Id. Respondent called in a refill of this prescription 
on December 6, 2009; however, there were no refills remaining. Id. at 
3; GX 29. Respondent then authorized a second prescription for himself, 
which he refilled on January 25 and April 19, 2010. GX 24, at 3; GX 25; 
GX 29.
    In addition, the Government subpoenaed pharmacy records from the 
AtlantiCare Health System, a hospital at which Respondent held 
privileges and treated patients. GX 35. These records, which covered 
the period from February 21, 2009 through April 13, 2011, showed that 
on numerous occasions following the surrender of his registration, 
Respondent issued orders for the administration of controlled 
substances to patients he was treating at the hospital. More 
specifically, during the year 2009 (and following the surrender of his 
registration), Respondent issued eight orders for controlled 
substances. Id. at 4-5. Moreover, during 2010, Respondent issued an 
additional twenty hospital orders for controlled substances, the last 
being issued on October 12th of that year.\10\ Id. at 6-8. Finally, 
Respondent issued six additional hospital orders for controlled 
substances through April 2011. GX 36.
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    \10\ According to a representative of the hospital, the 
spreadsheets showed hospital orders that ``were placed into the 
system by a pharmacist and were assigned to [Respondent] as the 
attending physician.'' Tr. 30.
    With respect to the hospital orders, Respondent contends that 
the reports provided by the hospital are unreliable because a 
patient may have had both an attending and an admitting physician, 
each of whom could have issued an order for a controlled substance. 
Resp. Br. 9. The hospital representative further testified that the 
practice of the pharmacy department was to list the attending 
physician as the prescriber unless the signature of the prescribing 
physician was legible. Tr. 77-79. In addition, the hospital 
representative testified that ``[r]esidents do not have independent 
prescribing authority at the hospital'' and that any orders placed 
by a resident had ``to be cosigned by the attending physician'' that 
the order is assigned to. Id. at 32-33.
    While Respondent testified that ``there are times when I'll call 
in and there will be a resident or he'll call me and ask me what I 
think, and I'll tell him what to do'' and ``[t]here are various ways 
to order things,'' id. at 278, as found above, residents did not 
have independent prescribing authority at the hospital. Likewise, 
Respondent was required to approve any order called or faxed in by a 
nurse. Id. at 59. Moreover, Respondent offered no testimony that any 
of the hospital orders were authorized by another physician who had 
independent prescribing authority.
    It is further noted that the hospital representative testified 
that he had ``one hundred percent confidence'' in the accuracy of 
the spreadsheets, id. 57-58; he also testified that he had retrieved 
the medical files for seven of the patients and confirmed that 
Respondent had actually signed the forms ordering controlled 
substances for them. Id. at 60-62. Six of these orders cover the 
period following the date on which Respondent surrendered his 
registration and included two orders from May and June 2010. See GX 
36. Moreover, a further spreadsheet listed multiple orders that were 
issued in April 2011.
    In her decision, the ALJ noted in a footnote that the ``[t]he 
parties dispute the number of hospital orders issued by 
Respondent.'' ALJ, at 13 & n.8. However, as ultimate factfinder, I 
reject Respondent's various contentions as to the reliability of the 
spreadsheet. As explained above, I find that Respondent issued 
thirty-four hospital orders for controlled substances following his 
surrendering of his registration.
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    Regarding the post-surrender prescriptions and hospital orders, 
Respondent denied issuing the March 11, 2009 diazepam prescription for 
his wife, noting that this prescription was called in to the pharmacy 
during the period in which he was an inpatient at Behavioral Health of 
Palm Beach. Tr. 311-12. Respondent also denied issuing the March 18, 
2009 prescription for temazepam for his former son-in-law (on which 
date he was still an inpatient in Palm Beach), as well as the July 6, 
2009 authorization for an additional prescription which was faxed into 
the pharmacy. Tr. 272, 330-31. With respect to the July 6 prescription, 
which was faxed into the pharmacy, Respondent testified that R.M., the 
employee whose name is listed as having faxed in the request on behalf 
of Respondent, denied having sent in the prescription. Id. at 331. 
While Respondent ``ha[d] no idea'' why the prescription was faxed in 
and stated that he did not authorize it, he did not deny that it 
originated from his office. Tr. 272.
    Respondent also denied authorizing all of the temazepam 
prescriptions for his daughter including the April 27 and June 16, 2009 
prescriptions which were called in by Linda. Indeed, Respondent denied 
having issued any of the temazepam prescriptions. Id. at 315. He also 
testified that Linda had denied authorizing the prescriptions and 
stated that he believed her. Id. at 330-31. However, when asked if 
someone in his office had authorized the prescriptions, Respondent 
replied that he ``ha[d] no idea what happened'' and did not ``know 
anything about it.'' Id. at 270.
    Respondent acknowledged that his daughter had a drug abuse problem 
and had undergone treatment shortly before the hearing in this matter. 
Id. at 315. Respondent further testified that his daughter had worked 
at his office,

[[Page 12097]]

including during the period in which he was an inpatient at Behavioral 
Health and that she was authorized to call in prescriptions. Id. at 
316; 328-29. However, when asked if he thought it was ``a good idea'' 
to authorize his daughter to call in prescriptions ``when she had a 
drug problem,'' Respondent asserted that ``[n]obody was authorized to 
refill narcotic prescriptions at all.'' Id. at 329; see also id. at 
335.
    Moreover, when asked how he monitored his staff to ensure that this 
did not happen, Respondent replied: ``Well it's a matter of trust. How 
would you know?'' and added that ``[t]he only way you would know is if 
you get a fax that something was called in that I didn't authorize.'' 
Id. at 329. Respondent then acknowledged that his office staff had 
access to his DEA number, id. at 330, and that while he would 
``absolutely'' fire an employee who was inappropriately using his DEA 
number, there was not enough evidence to convince him that any of his 
employees had actually called in the prescriptions with his surrendered 
number. Id. at 332. Respondent also testified that his daughter no 
longer works for him. Id. at 337.
    Respondent did admit to having issued the Androgel prescriptions 
for both D.S. and himself. Id. at 273. Respondent claimed that he did 
not realize that Androgel is a controlled substance, but testified that 
he was wrong to have issued the prescriptions and said he was 
``sorry.'' Id. at 274.
    As for the hospital orders, Respondent asserted that he ``was a 
staff physician'' at AtlantiCare. Id. at 275. While Respondent then 
acknowledged that his status as ``a staff physician'' did not mean that 
he was an employee, he then claimed that ``when I'm on call, I'm 
considered an employee.'' Id. at 276. However, according to the letter 
submitted by AtlantiCare's Associate General Counsel in response to the 
Government's subpoena for the records of Respondent's patients and 
hospital orders, Respondent was not employed by AtlantiCare. GX 35, at 
1. Indeed, Respondent testified that he was ``self-employed.'' Tr. 250.
    Respondent also testified that he ``felt obliged to treat'' the 
hospital patients and that while ``looking back * * * it's kind of a 
silly thing to do * * * I had no else to ask to treat these people. I 
was responsible for them. That was my job.'' Tr. 309. Respondent's 
counsel then asked him if he was ``consciously violating [his] lack of 
a DEA license?'' Id. Respondent replied: ``Not really. I really felt I 
was acting under the auspices of the hospital and in the patient's best 
interest, and that's the way I was trained. The patients always come 
first.'' Id. at 309-10. However, an employee of AtlantiCare testified 
that it has physicians known as hospitalists who were available to 
order any controlled substances necessary to treat Respondent's 
patients. Id. at 81. Moreover, when asked whether the effect of his 
surrendering his registration was that he was ``not allowed to 
prescribe,'' Respondent acknowledged that this was ``correct'' and 
added that he did not think he was allowed to administer controlled 
substances. Tr. 251.

Discussion

    Section 303(f) of the Controlled Substances Act (CSA) provides that 
the Attorney General ``may deny an application for [a practitioner's] 
registration if he determines that the issuance of such a registration 
is inconsistent with the public interest.'' 21 U.S.C. Sec.  823(f). In 
making the public interest determination, the CSA directs 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 * * * 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.

Id.

    ``[T]hese factors are * * * considered in the disjunctive.'' Robert 
A. Leslie, 68 FR 15227, 15230 (2003). I may rely on any one or a 
combination of factors and may give each factor the weight I deem 
appropriate in determining whether to revoke an existing registration 
or to deny an application for a registration. Id. Moreover, I am ``not 
required to make findings as to all of the factors.'' Hoxie v. DEA, 419 
F.3d 477, 482 (6th Cir. 2005); see also Morall v. DEA, 412 F.3d 165, 
173-74 (D.C. Cir. 2005).
    Where the Government has met its prima facie burden of showing that 
issuing a new registration to the applicant would be inconsistent with 
the public interest, the burden then shifts to the applicant to 
``present sufficient mitigating evidence'' to show why he can be 
entrusted with a registration. Medicine Shoppe-Jonesborough, 73 FR 364, 
387 (2008) (quoting Samuel S. Jackson, 72 FR 23848, 23853 (2007) 
(quoting Leo R. Miller, 53 FR 21931, 21932 (1988))). ``Moreover, 
because `past performance is the best predictor of future performance,' 
ALRA Labs, Inc. v. DEA, 54 F.3d 450, 452 (7th Cir.1995), [DEA] has 
repeatedly held that where a registrant has committed acts inconsistent 
with the public interest, the registrant must accept responsibility for 
[his] actions and demonstrate that [he] will not engage in future 
misconduct.'' Medicine Shoppe, 73 FR at 387; see also Jackson, 72 FR at 
23853; John H. Kennedy, 71 FR 35705, 35709 (2006); Cuong Tron Tran, 63 
FR 64280, 64283 (1998); Prince George Daniels, 60 FR 62884, 62887 
(1995); Hoxie v. DEA, 419 F.3d at 483 (``admitting fault'' is 
``properly consider[ed]'' by DEA to be an ``important factor[ ]'' in 
the public interest determination).

Factor One--The Recommendation of the State Licensing Board

    The ALJ found that this factor supported granting Respondent's 
application. More specifically, the ALJ noted that the PAP is actively 
monitoring Respondent's compliance with his aftercare plan and that he 
remains subject to UDSs. ALJ at 23. Moreover, in the event of a 
positive test result for a drug which has not been prescribed to him, 
his state license is subject to suspension.\11\ Also, with respect to 
his writing of tramadol prescriptions in his daughter's name and his 
positive urine screens for tramadol, the ALJ noted that he had appeared 
in front of the State Board and that the Board had declined to ``taken 
any adverse action.'' Id. The ALJ thus concluded that the Board's 
action, ``although not dispositive, deserve[s] consideration in 
determining the public interest.'' Id. The ALJ thus concluded ``that 
the Board's recommendation, in light of the overlapping facts it 
considered, weighs in favor of the Respondent's registration.\12\'' ALJ 
at 23-24.
---------------------------------------------------------------------------

    \11\ Citing the testimony of a PAP professional, the ALJ found 
that ``[i]f an illegitimate positive urine test result is reported, 
the Board will suspend the Respondent's license.'' ALJ at 23. 
However, while ``[a]ny non-prescribed positive test would result in 
an immediate notification to the Board,'' RX 11, at 1; it seems 
likely that the Board retains discretion as to whether to suspend 
his license.
    \12\ It is noted that the Board itself has made no 
recommendation to DEA in this matter and there is no evidence that 
the Assistant Director of the PAP is authorized to make 
recommendations on behalf of the Board. In discussing this factor, I 
assume without deciding that the Board's continuation of 
Respondent's license constitutes a recommendation of the state 
licensing or disciplinary authority as contemplated by 21 U.S.C. 
823(f)(1).
---------------------------------------------------------------------------

    Were this case limited to Respondent's prescribing of tramadol 
(which is not a controlled substance), I would likely adopt the ALJ's 
conclusion

[[Page 12098]]

as to the weight to be given this factor. However, while Respondent's 
self-prescribing and fraudulent prescribing to his daughter of tramadol 
may have been considered by the Board, as explained below, the record 
here contains substantial evidence of multiple violations of the 
Controlled Substances Act. Thus, not only did the state board not 
consider the entire scope of Respondent's misconduct, DEA has held that 
it has separate oversight responsibility (apart from that which is 
vested in state authorities) with respect to the handling of controlled 
substances and a statutory obligation to make its independent 
determination as to whether granting a registration would be consistent 
with the public interest. See Jayam Krishna-Iyer, 74 FR 459, 461 
(2009); Mortimer B. Levin, 55 FR 8209, 8210 (1990). Thus, while 
Respondent's continued licensure by the State renders him eligible to 
hold a DEA registration,\13\ this factor neither supports nor weighs 
against a finding that granting his application would be consistent 
with the public interest.\14\ See 21 U.S.C. 823(f).
---------------------------------------------------------------------------

    \13\ See 21 U.S.C. 823(f) (``The Attorney General shall register 
practitioners * * * to dispense * * * controlled substances . . . if 
the applicant is authorized to dispense * * * controlled substances 
under the laws of the State in which he practices.''); id. Sec.  
802(21) (``The term `practitioner' means a physician * * * licensed, 
registered, or otherwise permitted, by the * * * jurisdiction in 
which he practices * * * to distribute, dispense, [or] administer * 
* * a controlled substance in the course of professional practice or 
research.'').
    \14\ It is also noted that Respondent has not been convicted of 
an offense related to the distribution or dispensing of controlled 
substances (factor three). However, because there are multiple 
reasons why an applicant or registrant may not have been convicted 
or even prosecuted for such an offense, the absence of such a 
conviction ``is of considerably less consequence in the public 
interest inquiry.'' Krishna-Iyer, 74 FR at 461; Edmund Chein, 72 FR 
6580, 6593 n.22 (2007), pet. for rev. denied 533 F.3d 828 (D.C. Cir. 
2008). Accordingly, this factor is not dispositive.
---------------------------------------------------------------------------

Factors Two and Four--Respondent's Experience in Dispensing Controlled 
Substances and Compliance With Applicable Laws Related to Controlled 
Substances

    The ALJ found that factors two and four support the denial of 
Respondent's application. See ALJ at 24-25. I agree noting that the 
record establishes that Respondent has committed numerous violations of 
the CSA and has only accepted responsibility for a small portion of 
them.
    First, Respondent issued prescriptions for schedule II controlled 
substances including Roxicodone (oxycodone) 15 mg in the name of his 
deceased mother-in-law to obtain drugs which he personally abused. 
Moreover, Respondent engaged in this conduct for a period of 
approximately six years. In issuing these prescriptions, Respondent 
committed felony violations of federal law. See 21 U.S.C. 843(a)(3) 
(``It shall be unlawful for any person knowingly or intentionally * * * 
to acquire or obtain possession of a controlled substance by 
misrepresentation, fraud, forgery, deception, or subterfuge[.]'').\15\
---------------------------------------------------------------------------

    \15\ In his post-hearing brief, Respondent argues that his 
``overwhelming positive experience, totaling over 30 years as a 
specialist in the field of urology * * * should be a significant 
consideration'' in his favor. Resp. Prop. Findings & Conclusions of 
Law, at 14. Contrary to Respondent's assertion, factor two does not 
provide for an inquiry into Respondent's experience as a physician 
(which is beyond the expertise of this Agency) but only his 
experience in dispensing controlled substances. On that count, as 
found above, Respondent's experience is marked by his extensive and 
egregious misconduct in writing fraudulent prescriptions and by 
issuing numerous prescriptions and hospital orders without a 
registration.
---------------------------------------------------------------------------

    Second, on February 20, 2009, Respondent voluntarily surrendered 
his registration, thereby relinquishing his authority to prescribe, 
dispense, and administer controlled substances. Respondent nonetheless 
proceeded to issue numerous prescriptions and/or hospital orders for 
controlled substances. Respondent's conduct in doing so also violated 
federal law.
    Under federal law, ``[e]very person who dispenses * * * any 
controlled substance, shall obtain from the Attorney General a 
registration issued in accordance with the rules and regulations 
promulgated by him.'' 21 U.S.C. 822(a)(2). See also 21 CFR 1301.11(a) 
(``Every person who manufactures, distributes, [or] dispenses * * * any 
controlled substance * * * shall obtain a registration unless exempted 
by law or pursuant to [21 CFR] 1301.22 through 1301.26.''). In 
addition, ``[e]xcept as authorized by [the CSA], it [is] unlawful for 
any person knowingly or intentionally * * * to distribute [or] dispense 
a controlled substance.'' 21 U.S.C. 841(a)(1).
    It is undisputed that following the surrender of his registration, 
Respondent issued prescriptions both to himself and a patient for 
Androgel (testosterone), an anabolic steroid and a schedule III 
controlled substance. In his testimony, Respondent maintained that he 
did not know that Androgel is a controlled substance. The ALJ was not, 
however, favorably impressed by this testimony, noting that ``even if 
true, such denial does not relieve the Respondent from his 
responsibility to know such facts in the practice of his profession.'' 
ALJ at 24. I agree with the ALJ. Indeed, given that Respondent 
testified that prescribing testosterone was his ``specialty'' and that 
``[p]art of urology [his practice specialty] is to treat male 
hypogonadism,'' Respondent has no excuse for not knowing that 
testosterone is an anabolic steroid and a controlled substance. See 21 
U.S.C. 802(41) (``The term `anabolic steroid' means any drug or 
hormonal substance, chemically and pharmacologically related to 
testosterone[.]''); id. Sec.  812(c) Schedule III(e). However, 
Respondent did acknowledge his wrongdoing in having issued these 
prescriptions.
    The same cannot be said for his misconduct in issuing hospital 
orders for controlled substances. As found above, for more than two 
years after he surrendered his registration, Respondent issued hospital 
orders for controlled substances; this conduct was still occurring up 
until a month before the hearing in this matter. Moreover, while the 
Show Cause Order did not specifically refer to the hospital orders, it 
did allege that he had violated federal law and DEA regulations by 
authorizing prescriptions without a registration. ALJ Ex. 1, at 2 
(citing 21 U.S.C. 822 and 841(a); 21 CFR 1301.11 and 1301.13). Yet for 
months after being served with the Show Cause Order, Respondent 
continued to issue hospital orders without a registration.
    In defense of his actions, Respondent contends that there was no 
one else who could treat his patients and that he was acting in their 
best interests. While one would expect nothing less from a physician 
than to act in the best interest of his patients, this does not excuse 
his violations, and in any event, other record evidence establishes 
that AtlantiCare has physicians on staff who could have legally 
prescribed controlled substances to his patients.
    Respondent also attempted to justify the violations contending that 
he believed that: (1) He acted as an employee of the hospital when he 
was on call, and (2) he was ``acting under the auspices of the 
hospital.'' Tr. 309-10. As to the first contention, Respondent conceded 
that he was self-employed and not an employee of the hospital.
    As for the second contention, it is true that under federal law and 
DEA regulations, ``[a]n individual practitioner who is an agent * * * 
of a hospital, may, when acting in the normal course of business * * *, 
administer, dispense, or prescribe controlled substances under the 
registration of the hospital * * * which is registered in lieu of being 
registered himself * * * provided'' six conditions are met. 21 CFR 
1301.22(c); see also 21 U.S.C. 822(c). While Respondent met some of 
these conditions (in that there is no evidence that he acted outside of

[[Page 12099]]

the usual course of professional practice in issuing the orders and 
that he was authorized to prescribe controlled substances by the State, 
see id. 1301.22(c) (1) & (2)), Respondent produced no evidence that 
AtlantiCare authorized him ``to administer, dispense or prescribe 
controlled substances under the hospital['s] registration.'' Id. 
1301.22(c)(5). Respondent therefore cannot credibly claim that he acted 
as an agent of the hospital.
    With respect to Respondent's testimony regarding the hospital 
orders, the ALJ noted that it was ``unfortunate[ ] [that] the 
Respondent denied these violations.'' ALJ at 24-25. Whether it is 
fortunate or unfortunate is neither here nor there. It is, however, a 
manifestation that Respondent does not accept responsibility for a 
significant part of the misconduct which was proved on this record.\16\ 
Moreover, these violations were not limited in scope but continued for 
more than two years after Respondent surrendered his registration.
---------------------------------------------------------------------------

    \16\ To make clear, I acknowledge that there is no evidence that 
any of the hospital orders lacked a legitimate medical purpose. 
Nonetheless, federal law prohibits the dispensing of a controlled 
substance except as authorized by the CSA.
---------------------------------------------------------------------------

    As for the various controlled substance prescriptions that were 
issued in the names of Respondent's wife, daughter, and former son-in-
law following the surrender of his registration, the ALJ found ``it 
credible that [he] did not place phone-in orders for controlled 
substances during that time.'' ALJ at 25. However, the ALJ found that 
``Respondent left his prescription pads with his controlled substances 
registration number at the office during his absence'' and that 
``[s]omeone utilized that number to call in prescriptions for 
controlled substances.'' Id. Under DEA precedent, a practitioner is 
strictly liable for misuse of his registration by his employees. Edmund 
Chein, 72 FR 6580, 6593 (2007) (citing Leonard Merkow, 60 FR 22075, 
22076 (1995)), pet. for rev. denied 533 F.3d 828 (D.C. Cir. 2008).
    Moreover, even accepting the ALJ's credibility finding that 
Respondent did not call in the prescriptions during the period in which 
Respondent was an inpatient at Behavioral Health, as found above, 
additional controlled substance prescriptions were either called-in or 
faxed-in from his office (for his daughter and son-in-law) after he 
returned from rehab. In his testimony, Respondent denied having 
authorized these prescriptions. It is unclear, however, whether the ALJ 
found this testimony credible.\17\ See ALJ at 10-11 (noting 
Respondent's denial of having authorized April 2009 temazepam 
prescription for his daughter yet not making credibility finding as she 
did with other findings of fact); id. at 12 (noting that Respondent 
denied authorizing the July 2009 temazepam prescription for his son-in-
law but not making credibility finding).
---------------------------------------------------------------------------

    \17\ For example, in her discussion of factors two and four, the 
ALJ wrote with respect to the prescriptions that were called in when 
he was at Behavioral Health, ``I find it credible that the 
Respondent did not place phone-in orders for controlled substances 
during that time.'' ALJ at 25. The ALJ did not explain whether she 
found credible Respondent's denials of having authorized the 
temazepam prescriptions that were issued for his daughter and ex 
son-in-law following his return from rehab. Id.
     It is not entirely clear why the ALJ failed to address in her 
discussion of the public interest factors the prescriptions which 
were authorized following his return. However, her opinion suggests 
that she did not do so because ``[t]he majority of these 
prescriptions were initially phoned in while the Respondent was 
receiving inpatient treatment.'' ALJ at 25. Even so, the record 
shows that there were multiple prescriptions with refills issued 
following Respondent's return from inpatient treatment. Unlike the 
ALJ, I decline to ignore the evidence regarding these prescriptions 
and Respondent's explanation (or lack thereof) regarding why they 
were issued.
---------------------------------------------------------------------------

    However, even if it is true that Respondent did not authorize these 
prescriptions, he ``ha[d] no idea'' as to how the prescriptions were 
authorized and who had called or faxed them in to the respective 
pharmacies. Likewise, while Respondent testified that he would 
``absolutely'' fire an employee who was inappropriately using his DEA 
number, he then asserted that there was not enough evidence to convince 
him that any of his employees had actually called in the prescriptions 
with his former number.\18\
---------------------------------------------------------------------------

    \18\ As found above, in a December 2009 interview Respondent 
admitted that his daughter had a drug problem but that ``he did not 
realize how bad [her] problem was until he got out of drug 
rehabilitation * * * and became sober.'' GX 18, at 7. The Government 
did not, however, further clarify whether Respondent was aware of 
his daughter's drug problem before he went to rehab (even if he then 
did not realize ``how bad'' it was) nor the approximate date on 
which he finally realized ``how bad'' it was. Thus, I do not address 
the propriety of Respondent's having authorized his daughter to call 
in prescriptions.
---------------------------------------------------------------------------

    Obviously, someone in his office called or faxed in the 
prescriptions. As noted above, under Agency precedent, Respondent is 
responsible for violations of the CSA committed by his employees and 
his practice's failure to comply with the Act. Chein, 72 FR at 6593. 
Having failed to explain why the temazepam prescriptions were called 
in, Respondent has offered no credible assurance that similar acts will 
not occur in the future.
    Accordingly, as did the ALJ, I conclude that the Government's 
evidence pertaining to factors two and four makes out a prima facie 
case that granting Respondent's application would be inconsistent with 
the public interest. See ALJ at 25 (holding that ``grounds do exist for 
denying the Respondent's'' application).

Factor Five--Such Other Conduct Which May Threaten Public Health and 
Safety

    With respect to factor five, the ALJ noted that ``Respondent has 
now had two relapses in his history of drug addiction'' and that 
``[h]is pattern of prescribing medications for family members and then 
consuming them himself continued with [his] prescribing of [t]ramadol 
for his daughter and then consuming some of the medications himself.'' 
ALJ at 26. The ALJ further found that ``when first confronted with the 
information that DEA believed the Respondent had engaged in such 
conduct, the Respondent lied to the DEA agent and denied consuming such 
medication himself.'' Id. The ALJ thus noted that Respondent's 
``conduct is not consistent with the responsibilities of a DEA 
registrant.'' Id. I agree with the ALJ that substantial evidence 
supports both the findings that he consumed some of the tramadol he 
prescribed in his daughter's name and then lied to DEA Investigators 
when he denied having done so.
    However, the ALJ then noted that Respondent had presented 
``mitigating evidence in the form of his active participation in his 
recovery'' and that the PAP's assistant director testified that 
Respondent is in ``sustained full remission.'' Id. at 26-27. The ALJ 
also noted that Respondent had acknowledged his wrongdoing in 
prescribing testosterone and had provided assurances of his future 
compliant behavior including that ``he would no longer allow his staff 
to phone in or fax in prescriptions for controlled substances and ``his 
daughter would no longer work in his office.'' \19\ Id. at 27.
---------------------------------------------------------------------------

    \19\ The ALJ did not, however, make a finding as to whether this 
factor supports or weighs against granting Respondent's application. 
ALJ at 27-28. However, in her conclusion and recommendation, the 
ALJ, while acknowledging that ``[d]enial of the Respondent's 
application can be justified by this record,'' recommended that ``a 
less severe action be taken.'' Id. at 28.
---------------------------------------------------------------------------

    In his post-hearing brief, Respondent contends ``[t]hat DEA['s] 
argu[ment] that [his application] should be denied for being prescribed 
tramadol is by definition arbitrary and capricious.'' Resp. Prop. 
Findings of Fact, Conclusions of Law, and Argument, at

[[Page 12100]]

16. Respondent notes that ``tramadol is not even a controlled 
substance'' and that he ``is entitled to pain relief.'' Id. at 16-17.
    It is undeniable that Respondent is entitled to be treated (and 
receive lawfully issued prescriptions) for a legitimate pain 
condition.\20\ However, the evidence shows that Respondent wrote 
numerous prescriptions in his daughter's name to obtain the drugs for 
his own use and thereby committed prescription fraud. See N.J. Stat. 
Ann. Sec.  2C:35-10.5(d). Moreover, as found above under factors two 
and four, Respondent had previously obtained controlled substances by 
writing fraudulent prescriptions in the name of his deceased mother-in-
law and did so for years. Thus, even though tramadol is not a 
controlled substance, Respondent's continuing to write fraudulent 
prescriptions even after he was confronted by DEA personnel about the 
fraudulent prescriptions he wrote for controlled substances is properly 
considered in assessing the likelihood that he will comply with the CSA 
were he granted a new registration. See Paul Weir Battershell, 76 FR 
44359, 44368 (2011) (holding that violation of Federal law for 
introducing a misbranded drug into interstate commerce was not 
dispositive but could be considered under factor five ``for the limited 
purpose of assessing the likelihood of Respondent's future compliance 
with the CSA''); Wonderyears, Inc., 74 FR 457, 458 n.2. (2009) (noting 
that violations of federal and state laws in distributing and importing 
a non-controlled drug were ``relevant in assessing whether [pharmacy] 
would comply with the'' CSA). See also Terese, Inc., D/B/A Peach 
Orchard Drugs, 76 FR 46843, 46848 (2011) (noting that while agency case 
law interpreting factor five ``has generally recognized that the 
misconduct must be related to controlled substances * * * there may be 
other acts, which do not directly involve controlled substances, but 
which threaten public health and safety and create reason to conclude 
that a person will not faithfully adhere to [his] responsibilities 
under the CSA''). The commission of prescription fraud clearly has a 
sufficient nexus to a registrant's obligations under the CSA to warrant 
consideration under factor five. See 21 U.S.C. 843(a)(3).
---------------------------------------------------------------------------

    \20\ In its Exceptions, the Government notes that ``Respondent 
was concurrently receiving tramadol prescriptions from two different 
physicians.'' Exceptions at 2. While the Government notes that 
``Respondent explained that he was being treated for a different 
medical condition by each physician,'' it then contends that 
``Respondent did not contest the fact that neither doctor knew about 
the other or that Respondent was receiving the same medication from 
each doctor.'' Id. The Government then asserts that it ``does not 
believe that Respondent demonstrated the legitimacy of his 
prescriptions, because he failed to fully inform his treating 
physicians of his medical condition, of his treatment by the other 
physician and of his other prescriptions.'' Id. (citing GX 18, ] 
11).
    It is noted, however, that the Government called Respondent as a 
witness and yet never asked him whether he informed his treating 
physicians that he was receiving prescriptions from another 
physician. Moreover, the Government did not introduce any medical 
records maintained by the physicians on Respondent which may have 
shown that Respondent did not disclose that he was being treated by 
other doctors, and Dr. M.'s statements (which were related in GX 18) 
that he did not know that Respondent was seeing Dr. C. and receiving 
tramadol prescriptions were unsworn and not corroborated by any 
other evidence of record.
     However, one of Respondent's Exhibits shows that on July 28, 
2009 he was admonished by the Executive Medical Director of the PAP 
for ``his self-prescribing'' and told ``to get his treating 
physician, Dr. [B.], his orthopedic surgeon, to write any future 
prescriptions.'' RX 8, at 19; see also id. at 18. (Sept. 16, 2009 
memo from Executive Medical Director, PAP, to State Board of Medical 
Examiners) (Respondent ``was instructed to have his orthopedic 
surgeon, Dr. [B.], write for any medication he needed for pain (7/
28/09).''). Yet after that date, Respondent obtained prescriptions 
for tramadol from both Dr. C. (on Aug. 10) and Dr. M. (on Aug. 20). 
See GXs 13 & 14. While Respondent testified that Dr. M. and Dr. B. 
were in the same group, Tr. 260-61, he offered no evidence that Dr. 
C. was as well. This suggests that Respondent did not comply with 
the PAP Executive Director's instruction.
---------------------------------------------------------------------------

    As noted above, the ALJ also found that Respondent had lied to the 
DEA Investigators ``when first confronted'' by them about whether he 
was using the tramadol he obtained by issuing prescriptions in his 
daughter's name. ALJ at 26. It further follows that Respondent gave 
false testimony under oath in this proceeding when he denied having 
ever admitted to the PAP Director that he had used some of the tramadol 
obtained from these prescriptions and then added that: ``I never used 
[t]ramadol written in my daughter's name.'' Tr. 323. Respondent's lack 
of candor both during the investigation and at the hearing is an 
important factor in the public interest determination. See Hoxie, 419 
F.3d at 483 (``DEA properly considers the candor of the physician and 
his forthrightness in assisting in the investigation and admitting 
fault important factors in determining whether the physician's 
registration'' is consistent with the public interest.''); \21\ see 
also Edmund Chein v. DEA, 533 F.3d 828 (D.C. Cir. 2008) (affirming 
order revoking practitioner's registration and denying application 
noting physician's ``continued dispensing of controlled substances even 
after his DEA registration was suspended'' and failure to ``accept[ ] 
responsibility for his misconduct'').
---------------------------------------------------------------------------

    \21\ I thus reject Respondent's contention that he has 
cooperated with DEA and ``exhibited'' candor ``throughout the 
process, including at the hearing.'' Resp. Prop. Findings at 16.
---------------------------------------------------------------------------

    To be sure, Respondent presented substantial evidence that he is 
currently in remission. If the proven misconduct was limited to 
Respondent's self-abuse of controlled substances, the ALJ's 
recommendation that I grant him a restricted registration might be well 
taken. But it is not. While Respondent acknowledged his wrongdoing with 
respect to his issuance of the testosterone prescriptions without a 
registration, he failed to do so with respect to his issuance of 
hospital orders notwithstanding that he issued them for more than two 
years following the surrender of his registration and continued doing 
so even after being served with the Show Cause Order which notified him 
that his issuance of controlled substances without a registration was a 
violation of federal law. See Hoxie, 419 F.3d at 483 (noting that ``DEA 
properly considers * * * admitting fault [to be an] important factor[ 
]'' in public interest determination); see also Medicine Shoppe, 73 FR 
at 387; Jackson, 72 FR at 23853; John H. Kennedy, 71 FR 35705, 35709 
(2006); Cuong Tron Tran, 63 FR 64280, 64283 (1998); Prince George 
Daniels, 60 FR 62884, 62887 (1995).
    Also, in his own words, Respondent ``had no idea'' and ``did not 
know anything about'' why the temazepam prescriptions for his daughter 
and former son-in-law, which he denied issuing, continued to be called 
or faxed in to pharmacies after his return from inpatient treatment. 
Thus, even if it is true that Respondent did not authorize the 
prescriptions, he has failed to establish that this problem will not 
occur in the future. Respondent has therefore failed to ``present 
sufficient mitigating evidence'' to show why he can be entrusted with a 
new registration. Medicine Shoppe-Jonesborough, 73 FR at 387 (quoting 
Jackson, 72 FR at 23853 (quoting Leo R. Miller, 53 FR at 21932 
(1988))). Respondent's conduct in issuing fraudulent prescriptions and 
giving less than truthful statements and testimony reinforces this 
conclusion.
    Accordingly, I reject the ALJ's recommended sanction \22\ and will 
deny Respondent's application.
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    \22\ As the ALJ herself recognized, the Government ``presented 
preponderating evidence of * * * Respondent's illegal conduct in 
handling controlled substances after the voluntary surrender of his 
DEA registration'' and the ``[d]enial of [his] application can be 
justified by this record.'' ALJ at 28.
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Order

    Pursuant to the authority vested in me by 21 U.S.C. 823(f) and 28 
CFR 0.100(b),

[[Page 12101]]

I order that the application of John V. Scalera, M.D., for a DEA 
Certificate of Registration as a practitioner, be, and it hereby is, 
denied. This order is effective March 25, 2013.

    Dated: February 12, 2013.
Michele M. Leonhart,
Administrator.
[FR Doc. 2013-03879 Filed 2-20-13; 8:45 am]
BILLING CODE 4410-09-P