[Federal Register Volume 85, Number 168 (Friday, August 28, 2020)]
[Notices]
[Pages 53402-53421]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-18975]


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DEPARTMENT OF JUSTICE

Drug Enforcement Administration

[Docket No. 16-33]


Heavenly Care Pharmacy; Decision and Order

    On August 3, 2016, the Deputy Assistant Administrator, Office of 
Diversion Control, Drug Enforcement Administration issued an Order to 
Show Cause (``OSC'') to Heavenly Care Pharmacy (hereinafter, Respondent 
or Respondent Pharmacy), which sought to revoke Respondent's DEA 
Certificate of Registration FH4377291, at the registered location of 
617 9th Ave., Bessemer, Alabama, and to deny any pending or current 
applications for renewal or modifications of FH4377291. Administrative 
Law Judge Exhibit (ALJX) 1 (OSC), at 1-2, 7 (citing 21 U.S.C. 823(f), 
824(a)(4)). The OSC alleged that Respondent's continued registration is 
inconsistent with the public interest. Id. at 1. Specifically, the OSC 
alleged that Respondent (1) failed to exercise its corresponding 
responsibility to assess the legitimacy of prescriptions that it filled 
in violation of 21 CFR 1306.04(a) and failed to dispense controlled 
substances within the bounds of the pharmacy profession in violation of 
21 CFR 1306.06, id. at 2; (2) failed to maintain certain records 
required under federal and Alabama

[[Page 53403]]

state law and have them available for inspection, id. at 5-7 (citing 21 
CFR 1304.11(a) and (b); 1304.11(e)(1)(iii) and (iv); 1304.11(e)(6); 
1304.21(a); and 1305.04(a)); and (3) inaccurately reported its 
dispensing data to the Alabama Prescription Drug Monitoring Program 
(PDMP), which the OSC alleged ``clearly constitutes `such other conduct 
which may threaten the public health and safety' that counsels against 
[Respondent's] maintenance of a DEA registration,'' id. at 7 (citing 21 
U.S.C. 823(f)(5)). The Government also alleged via its Supplemental 
Prehearing Statement that Respondent provided materially false 
responses in a registration renewal application filed on September 8, 
2016. ALJX 16, at 1.
    In a letter from its counsel dated September 7, 2016, Respondent 
requested a hearing on the allegations. ALJX 2. The matter was placed 
on the docket of the Office of the Administrative Law Judges and 
assigned to Chief Administrative Law Judge John J. Mulrooney, II 
(hereinafter, Chief ALJ). Prehearing proceedings were initiated, ALJX 
3, and the Government filed a Prehearing Statement, ALJX 4; however, 
the case was terminated on October 13, 2016, due to the Respondent's 
non-compliance with the Chief ALJ's orders, ALJX 3, 5-7. On June 15, 
2017, the Acting Administrator of the DEA issued an order remanding the 
matter to the Office of the Administrative Law Judges for a hearing. 
ALJX 12. The case was reassigned to ALJ Mark M. Dowd. ALJX 21.
    Respondent filed a Prehearing Statement and the Government filed a 
Supplemental Prehearing Statement on July 19, 2017. ALJX 16 and 17. The 
ALJ issued an order with a consolidated list of the parties' 
stipulations on August 2, 2017, ALJX 23, and a hearing was conducted on 
August 29-31, 2017, in Birmingham, Alabama, ALJX 14. Both the 
Government and the Respondent filed Posthearing Briefs.
    On November 6, 2017, the ALJ issued and served his recommended 
decision, which included the ALJ's recommendation that I revoke 
Respondent's registration and deny its pending application for renewal. 
Recommended Decision (hereinafter, RD), at 61. Neither the Government 
nor Respondent filed exceptions to the ALJ's RD, and the record was 
forwarded to me for final agency action.
    Having considered the record in its entirety, I agree with the RD 
that the record established, by substantial evidence, two independent 
grounds for the revocation of Respondent's registration: (1) 
Respondent's continued registration is inconsistent with the public 
interest; and (2) Respondent materially falsified its renewal 
application. I further agree with the RD that Respondent's acceptance 
of responsibility is insufficient and that, even if it were sufficient, 
Respondent did not offer adequate remedial measures.
    Accordingly, I conclude that the appropriate sanctions are (1) for 
Respondent's DEA Registration FH4377291 to be revoked; and (2) for any 
pending application by Respondent to renew or modify its registration 
be denied. I make the following findings.

I. Findings of Fact

A. Respondent's DEA Registration

    Respondent Heavenly Care Pharmacy holds DEA registration FH4377291, 
which authorizes it to dispense controlled substances in schedules II 
through V as a retail pharmacy at the registered location of 617 9th 
Ave. N., Bessemer, Alabama 35020. RD, at 7. The registration was set to 
expire on October 31, 2016, but Respondent submitted a timely renewal 
application on September 8, 2016.\1\ Id.
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    \1\ The status of a registration under an OSC, such as 
Respondent's, does not impact my jurisdiction or prerogative under 
the Controlled Substances Act (hereinafter, CSA) to adjudicate the 
OSC to finality. Jeffrey D. Olsen, M.D., 84 FR 68,474 (2019).
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    Respondent's answers on the renewal application were certified as 
true and correct by Santonia Davison, Respondent Pharmacy's owner/
proprietor and Pharmacist-in-Charge (PIC) (hereinafter, PIC Davison). 
Government Exhibit (hereinafter, GX) 26, at 1; Transcript (hereinafter, 
Tr.) 693. On the renewal application, Respondent answered ``No'' to the 
question ``Has the applicant ever surrendered (for cause) or had a 
federal controlled substance registration revoked, suspended, 
restricted or denied, or is any such action pending?'' GX 26, at 1; Tr. 
214. I find by clear, unequivocal, and convincing evidence that 
Respondent's answer was false because Respondent acknowledged that it 
was served the OSC on August 9, 2016. See ALJX 2, at 1.

B. The Investigation of Respondent

1. Forgery Investigation
    In October 2014, a Diversion Investigator (hereinafter, DI One) and 
a Birmingham Police Department Sergeant (hereinafter, Police Sergeant) 
were working a prescription forgery ring, which involved approximately 
ten pharmacies, including the Respondent Pharmacy.\2\ Tr. 130-31, 138-
39, 814-16. Prescription pads had been stolen from The University of 
Alabama Medical Center (UAB) and were being forged to obtain controlled 
substances. Id. at 135, 231-32.
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    \2\ DI One has been a DEA Diversion Investigator since July 
2012. She was assigned to the Birmingham DEA Office in September 
2012. Tr. 129.
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    Along with the Police Sergeant, DI One proceeded to the Respondent 
Pharmacy to obtain hard copies of the forged prescriptions filled 
there. Id. at 131, 234; GX 6. Of the ten pharmacies involved in the 
investigation, DI One testified that Respondent Pharmacy had the most 
forged prescriptions filled--at least seven during a two-week time 
frame. Tr. 138-39, 233-35. While there, PIC Davison notified the Police 
Sergeant and DI One that one of the forged prescriptions had only been 
partially filled, and that the individual was expected to return 
shortly to fill the remainder of the prescription. Id. at 133, 816-19. 
When the subject individual sought to fill the remainder of the 
prescription, he was arrested by the Police Sergeant and removed to a 
back room at the pharmacy for questioning. Id. at 134, 817-18. Again 
with PIC Davison's assistance, two other individuals were questioned at 
the Respondent Pharmacy in connection with the forgery ring that day. 
Id. at 134, 586-87, 817-18.
2. Administrative Inspection
    On May 20, 2015, DEA Investigators executed an Administrative 
Inspection Warrant (AIW) at Respondent. GX 1, at 4; Tr. 30. The lead 
Diversion Investigator for the audit (hereinafter, DI Two) \3\ 
presented the AIW to PIC Davison. Tr. 30. DI Two was accompanied on the 
inspection by another diversion investigator, a DEA intelligence 
analyst, two local police officers, and two Alabama Board of Pharmacy 
investigators. Id. at 30, 31. DI Two testified that when she entered 
the pharmacy there were papers everywhere ``like someone had turned on 
a fan in there'' and that there was trash on the counter. Id. at 32.
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    \3\ DI Two has been a DEA diversion investigator since February 
2011. Tr. 24, 25. DI Two is assigned to investigate DEA registrants, 
and in that capacity, typically inspects ten to twelve pharmacies a 
year. Tr. 25-26.
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    During the inspection, the investigators requested Respondent's 
``initial inventory,'' the annual inventory required by the State of 
Alabama, controlled substance ordering records, controlled substance 
receipt records, and records accounting for all controlled substances 
dispensed from the pharmacy, to date. Id. at 31-34, 83. DI Two 
testified that she requested these records for two reasons: (1) To 
audit the

[[Page 53404]]

number of controlled substances--the drugs entering and leaving the 
pharmacy; and (2) to review the records for completeness. Id. at 34
    PIC Davison was unable to produce an initial inventory of the 
controlled substances at the pharmacy to DI Two. Id. at 32-33. During 
the hearing, she testified that she did not know that she was required 
to have an initial inventory, id. at 543, but conceded that the 
Pharmacy Manual, which she studied in pharmacy school and used in 
developing her policies and procedures, contained a detailed 
explanation of the initial inventory report requirements, id. at 700. 
PIC Davison was also unable to produce the annual inventory required by 
the state to be completed on January 15, 2015, id. at 33, and during 
the hearing she stated that she could not produce the inventory record 
because she did not complete the inventory on January 15, 2015, id. at 
714.
    PIC Davison did produce records during the inspection for the 
ordering, receipt, and dispensation of controlled substances. For 
Schedule II substances, Respondent ordered drugs using both DEA Form 
222s and through an electronic Controlled Substance Ordering System 
(CSOS). Id. at 35, 46-49, 562. DI Two testified that fifteen of 
Respondent's DEA Form 222s lacked documentation to evidence the receipt 
of the number of packages received and the date received, Tr. 46-48; GX 
3, and that Respondent had failed to record that it had received the 
ordered drugs for sixteen orders in Respondent's CSOS, Tr. 35-36, 98-
99; GX 2. DI Two acknowledged that documentation of receipt would not 
exist for drugs that were ordered and not received, Tr. 48-49, and that 
there was no set amount of time in which a pharmacy must record receipt 
on a DEA Form 222 or in the CSOS, id. at 40-42, but expressed doubt 
that the orders were not received, because they dated back to 2014 and 
the pharmacist had not written ``VOID'' on the DEA Form 222s, id. at 
36-37, 43-44, 48-49. PIC Davison confirmed that Respondent Pharmacy 
had, in fact, received the orders. Id. at 92, 564-65.
    DI Two testified that she also found the records for Respondent's 
orders of schedule III-V controlled substances to be incomplete because 
they did not indicate the date or the amount received. Id. at 50; GX 4. 
On some of the receipt invoices, Respondent had circled the quantity 
shipped, which DI Two inferred could indicate the amount received was 
correct, but on other receipt invoices, there were no circled 
quantities. Tr. 50-51; GX 4. PIC Davison did sign the invoices, which 
she testified she did to document receipt of the order and confirm that 
the quantity and date listed on the invoice were correct. Tr. 578; GX 
4.
    DI Two further testified that, in her experience, it was unusual to 
find such a large number of record-keeping discrepancies at a new 
pharmacy, such as Respondent Pharmacy. Tr. 112. She stated that the 
paperwork at newer pharmacies is generally very compliant and that, in 
general, it is not until a pharmacy is busier that the record-keeping 
becomes ``sloppier.'' Id. at 112-13.
    As part of executing the AIW, DI Two completed a closing inventory 
(count) of the generic versions of six controlled substances--
hydrocodone 10/325, hydrocodone 7.5/325, promethazine with codeine 
cough syrup, oxycodone 10/325, oxycodone 15, and oxycodone 30. Id. at 
34, 115, 120-21. Using Respondent's receipt and dispensation records, 
the DI conducted an audit of Respondent's handling of these six 
controlled substances. Id. at 34. These records included Respondent's 
DEA Form 222s, CSOS records, schedule III-V receipt invoices, and 
dispensation records printed by PIC Davison from her electronic system 
and provided to the investigators. Tr. 55-57, 555-57; GX 27. DI Two 
stated that for the purposes of the audit, she assumed all drug orders 
had been received by the pharmacy even though, as described above, 
Respondent had not documented receipt of all orders. Tr. 53. DI Two's 
audit found both shortages and overages among the six drugs, including 
a 22% shortage of oxycodone 10/325 and a 92% overage of hydrocodone 
7.5/325. GX 5.\4\
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    \4\ DI Two explained that a shortage occurs when a pharmacy 
cannot account for drugs received, i.e., the drug is not in the 
pharmacy's inventory but there is no record of it being dispensed or 
otherwise leaving the pharmacy, and an overage reflects the presence 
of controlled substances in the pharmacy's inventory in excess of 
the recorded amount received. Tr. 58.
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    Respondent disputes the accuracy of DI Two's audit. Tr. 551-57. PIC 
Davison testified that she completed her own closing inventory of the 
six controlled substances on May 20, 2015, and had a different count 
than DI Two's for five of the six drugs. Tr. 551-52; GX. 7, at 3. PIC 
Davison also testified that she believes DI Two's tabulations for the 
amounts distributed for five of the six drugs were inaccurate, because 
they were based on an incorrect report that PIC Davison provided at the 
inspection. Tr. 553-57. PIC Davison stated that she did not know how to 
run the report in her computer system for the information that DI Two 
requested, and it was not until July 6, 2015, that PIC Davison ran the 
``correct'' report, on which she based her own tabulations.\5\ Tr. 555, 
561; GX 7, at 3. PIC Davison does not dispute that the July 6 report, 
which she claims to be the report that should have been used for the 
audit, was not available to the DEA Investigators during the inspection 
of Respondent Pharmacy. Tr. 561.
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    \5\ PIC Davison's own tabulations using the July 6 report still 
showed a shortage for one and overages for three of the six audited 
drugs. GX 7, at 3. At the hearing, after seeing the July 6 report 
and PIC Davison's tabulations, DI Two testified that she believed at 
least one of PIC Davison's tabulations was incorrect. Tr. 823-24.
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    DI Two returned to the Respondent Pharmacy on May 21, 2015, to 
discuss with PIC Davison each regulatory violation, the audit 
discrepancies that DI Two discovered, and instructions regarding steps 
to correct these violations. Id. at 62-64, 81, 85, 112.\6\ DI Two did 
not recall any explanation by PIC Davison for the regulatory violations 
or audit discrepancies discussed. Id. at 63-64.
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    \6\ DI Two testified that after the May 21, 2015 conversation 
with PIC Davison she had no other interaction with the Respondent 
Pharmacy. Tr. 65. However, DI Two did learn through DI One that PIC 
Davison believed that either DI Two or one of the individuals on the 
day of the AIW took with them a notebook that had the missing 
records, or improperly kept records from it. Id. at 66. DI Two 
testified that this was not possible, as the alleged notebook had 
been reviewed multiple times on May 20, 2015. Id. at 66. Moreover, 
DI Two did not believe that a notebook that had been taken from the 
Respondent Pharmacy contained any missing/incomplete records as DI 
Two and the other investigators spent five to six hours in the 
Respondent Pharmacy, and the Respondent Pharmacy was not very large, 
and DI Two believed that if the record was there, it would have been 
found. Id. at 68. Moreover, DI Two stated that everything taken from 
the Respondent Pharmacy was recorded in Government Exhibit 1. Id. at 
69; see GX 1.
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    The ALJ found, and I agree, that the testimony of DI Two regarding 
the execution of the AIW, the audit, and all other aspects of her 
testimony was fully credible. RD, at 13.
3. July 6, 2015 Meeting
    DI One reviewed the results of the AIW at Respondent Pharmacy and 
invited PIC Davison to attend a meeting on July 6, 2015, at the 
Birmingham DEA Office with DI One, two of DI One's supervisors, and two 
investigators from the Alabama Board of Pharmacy, including its Chief 
Investigator, to discuss bringing the Respondent Pharmacy ``into 
compliance'' with the relevant regulations and professional standards. 
Tr. 143-44. The officials contemplated entering into a Memorandum of 
Agreement (MOA) with Respondent Pharmacy for what was essentially a 
probationary period in which the DEA would agree not to seek

[[Page 53405]]

sanctions as long as the Respondent Pharmacy cooperated with the DEA to 
bring the Respondent Pharmacy into compliance. Id. at 144-45. At some 
point during the meeting,\7\ the officials decided that an MOA would 
not be appropriate, and that proceedings would be initiated to pursue 
revocation of the Respondent Pharmacy's registration. Id. at 144. DI 
One explained that this decision was reached because PIC Davison did 
not concede that the reported violations had occurred, deflected direct 
questions, and wished to dispose of the matter by simply paying a fine. 
Id. at 145-47.
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    \7\ DI One could not remember how long into the meeting the 
decision was made to move for revocation, and Counsel for the 
Respondent Pharmacy suggested the meeting only lasted perhaps 90 
seconds; however, PIC Davison later suggested the meeting lasted at 
least 30-40 minutes. Tr. 549.
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    PIC Davison testified that she learned about the requirement to 
have an initial inventory during the July 6 meeting and, after the 
meeting, went to the pharmacy to look through her records and ``see if 
[she] could find perhaps what they could be looking for.'' Id. at 543-
44. PIC Davison found a ``Narcotics Sales Report'' generated from 
Cardinal Health, Respondent Pharmacy's sole pharmaceutical distributor, 
which listed Respondent's controlled substance purchases from May 1 to 
May 31, 2014, and which PIC Davison thought was ``as close to what they 
were explaining to me I should have [for an initial inventory].'' Id. 
at 544-45. PIC Davison then handwrote ``Initial Inventory'' on the 
report. Id. at 545.
    The next morning, July 7, 2015, at 1:54 a.m., DI One received an 
email from PIC Davison explaining that her ``initial inventory'' had 
been in a three-ring binder that had been ``retrieved'' by one of the 
DEA Agents during the May 20, 2015, inspection.\8\ Tr. 149-50. The 
email included a two-page attachment, the ``Narcotics Sales Report,'' 
which PIC Davison purported to be the Respondent Pharmacy's ``initial 
inventory.'' Tr. 151; GX 7, at 58-59. DI One suspected that the report 
was produced on the evening of July 6, 2015.\9\ Tr. 150-53, 246-48, 
253. The ``Narcotics Sales Report'' included a list of the schedule III 
through V controlled substances procured by the Respondent Pharmacy 
from Cardinal Health from May 1, 2014, through May 31, 2014. Tr. 151-
55; GX 7, at 58-59. The Respondent Pharmacy opened for business on May 
26, 2014. Besides perhaps not being a timely report--that is, not 
created at the time the Respondent Pharmacy began dispensing controlled 
substances, Tr. 151-156--DI One opined that it was not a fully 
compliant initial inventory report, as it lacked several other 
necessary elements. It did not include the initial inventory of 
schedule I and II controlled substances. It also lacked a specific date 
and whether it was taken at the open or close of business on that date. 
Id. at 154, 250.
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    \8\ PIC Davison later explained to DI One that the initial 
inventory had been picked up by a DEA Agent during the May 20, 2015 
audit, and was not discovered by PIC Davison until later that 
evening. Tr. 258.
    \9\ The time of the document's creation was suggested to the 
Government by review of other documents apparently created 
coincident to the subject document. Tr. 150-56.
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4. DI One's Investigation
    Sometime following the July 6, 2015 meeting with PIC Davison, DI 
One received a call from a local Alabama doctor, (hereinafter, Dr. F.), 
complaining that the Respondent Pharmacy had filled a prescription and 
attributed it to him (Dr. F.) in the Alabama Prescription Drug 
Monitoring Program, PDMP, which the doctor denied prescribing. Id. at 
157-59. To investigate the matter further, DI One retrieved the PDMP 
report for the subject prescription and a PDMP report for the 
Respondent Pharmacy from August 2014-August 2015, revealing all 
controlled substances dispensed by the Respondent Pharmacy during that 
period. Id. at 159-60; see GX 8. DI One further retrieved the original 
prescription from the Respondent Pharmacy, which identified a different 
doctor as the prescriber, yet the Respondent Pharmacy label incorrectly 
identified Dr. F. as the prescriber. Tr. 162-68; see GX. 9.
    Using the August 2014-August 2015 PDMP report, DI One located two 
other instances where the wrong doctor was identified as the prescriber 
in the subject Respondent Pharmacy PDMP report. Id. at 170-71. DI One 
also found instances where duplicate prescriptions were entered into 
the PDMP. Id. at 172-73; see GX 10, at 36. DI One additionally 
identified a twenty-one day period in which no controlled substance 
prescriptions were entered into the PDMP by the Respondent Pharmacy, 
yet nearly 100 prescriptions were filled there during that period. Tr. 
174; see GX 10, at 36. These discrepancies prompted DI One to retrieve 
a number of original prescriptions from the Respondent Pharmacy. Tr. 
180-81; see GX 11-17, 28.
    DI One also testified regarding the two administrative subpoenas 
the DEA issued to Respondent. Tr. 197. The first was issued on February 
16, 2016, and requested any documentation on prescriptions for specific 
patients, specific prescribers, and patients and prescribers that met 
certain characteristics. GX 18. Respondent replied to this subpoena 
with a single document describing Respondent's interactions with and 
knowledge of the patients and prescribers in narrative, summary form. 
GX 19. The DEA issued a second subpoena on May 6, 2016, requesting 
``any and all documents or records (paper or electronic) reflecting 
efforts by pharmacists at Heavenly Care Pharmacy to exercise their 
corresponding responsibility to assess the prescriptions for controlled 
substances they were asked to fill or dispense from March 1, 2013, 
through December 31, 2015.'' GX 20. The subpoena was delivered to 
Respondent's counsel along with a letter clarifying that the DEA was 
not asking Respondent to ``create documents that do not already exist'' 
but rather was seeking ``contemporaneous documents or records that fit 
the description provided in the subpoena.'' Id.; see Tr. 202. DI One 
testified that the DEA served the second subpoena because it wanted to 
be sure that Respondent ``provided any and all documentation regarding 
patient profiles of dispensing controlled substances to the specific 
patients and prescribers on the administrative subpoena.'' Tr. 204. 
Respondent replied to this subpoena with printouts of patient profiles 
that Respondent kept in its computer system regarding the patients 
identified by the DEA. GX 22; see Tr. 209-10. DI One provided 
Respondent's responses to the subpoenas to Dr. Alverson to use in her 
review. Tr. 197.
    The ALJ found, and I agree, that, although DI One reported some 
memory lapse regarding uncritical aspects of the investigation, her 
testimony was credible in all relevant respects. RD, at 15.

C. Testimony of Dr. Susan Alverson

1. Dr. Alverson's Credentials
    Dr. Susan Alverson, a licensed pharmacist for forty-nine years, has 
been the Executive Secretary for the Alabama Board of Pharmacy for the 
preceding four years. Dr. Alverson was qualified as an expert in retail 
pharmacy and the standards for retail pharmacists under both Alabama 
and federal law and regulations. Id. at 309-12. The ALJ found that Dr. 
Alverson testified convincingly as an expert witness and Respondent 
conceded Dr. Alverson is a renowned expert. RD, at 20.
2. Auburn University Encounter
    Prior to offering her expert opinion testimony, Dr. Alverson 
testified as a fact witness regarding an encounter she had with PIC 
Davison approximately

[[Page 53406]]

one month prior to the hearing. Tr. 313. Dr. Alverson was at Auburn 
University for a continuing education program. Following the program, 
Dr. Alverson was approached by PIC Davison, one of Dr. Alverson's 
former students at Samford University. Id. at 313-316. PIC Davison told 
Dr. Alverson that DEA wanted to ``take [her] license.'' Id. at 315-16. 
PIC Davison began to explain the circumstances of her situation to Dr. 
Alverson. She explained, in essence, that patients from a nearby 
pharmacy who appeared to be addicted to prescription drugs had 
gravitated to her pharmacy. Id. PIC Davison suggested she could not 
``just cut them off and leave them with no options.'' Id. at 317. PIC 
Davison also voiced her concern to Dr. Alverson about disparate 
treatment of black patients by the medical/pharmaceutical establishment 
and law enforcement. Id.
    On cross-examination, Dr. Alverson conceded PIC Davison's comments 
may have been less exacting. Dr. Alverson testified that it was 
possible PIC Davison did not use the word ``addicted'' and may have 
instead said that the subject patients were receiving the same 
medication from another pharmacy before coming to Respondent Pharmacy 
and that ``[w]hatever problems they had when they got to [Respondent 
Pharmacy], they had those problems before they got to [Respondent 
Pharmacy].'' Id. at 329-30.
    Dr. Alverson was unaware of the name of the pharmacist involved in 
her review of Respondent Pharmacy (and therefore did not immediately 
connect PIC Davison to Respondent Pharmacy), but as their conversation 
progressed, Dr. Alverson recognized the circumstances described by PIC 
Davison as involving the instant investigation. Id. PIC Davison then 
reported that she had read Dr. Alverson's statement on the matter. Dr. 
Alverson advised PIC Davison to confer with PIC Davison's attorney for 
advice, and took her leave. Id. at 316-17.
    The ALJ found, and I agree, that Dr. Alverson testified credibly as 
a fact witness. RD, at 20.
3. Dr. Alverson's Expert Opinion
    Dr. Alverson testified about an Alabama pharmacy's/pharmacist's 
standard of practice when presented with a controlled substance 
prescription. See Tr. 331-356. Dr. Alverson explained the evolution of 
the professional responsibilities of pharmacists to the contemporary 
healthcare team-concept, in which the pharmacist has a ``corresponding 
responsibility'' to the prescribing physician to make an independent 
evaluation of each prescription. Tr. 334-35, 347. A pharmacist cannot 
assume that a prescription is legitimate just because it was written by 
a physician. Id. at 348. The pharmacist acts as the final 
``gatekeeper'' in dispensing prescribed medication, with the patient's 
health and safety of paramount concern. Id. at 347-52. The pharmacist 
must make her own determination that a prescribed drug is safe and 
appropriate for the patient and look for indicators that the drug was 
prescribed for illegitimate reasons or outside the norms of the medical 
profession. Id. at 332, 347-48, 377, 474.
    Dr. Alverson noted that the State of Alabama had adopted this 
concept and codified it in several provisions of the Alabama 
Administrative Code. See Tr. 335; GX 25; Ala. Admin. Code 680-X-2-.21. 
For example, Ala. Admin. Code 680-X-2-.21(2) provides that ``[e]ach new 
prescription and, where appropriate, refill prescription, should be 
reviewed for, but not limited to, the following: (a) Therapeutic 
duplication; (b) drug-disease contraindication where indicated; (c) 
drug-drug interaction; (d) incorrect dosage/duration; (e) drug allergy 
interactions; and (f) clinical abuse/misuse.'' Dr. Alverson explained 
the practical application of these requirements, what is expected of 
Alabama pharmacists in these regards, and the potential fatal 
consequences to patients upon the pharmacist's failure to comply with 
any of these provisions. Tr. 336-40. Dr. Alverson discussed the 
pharmacist's codified responsibility to develop, document, and maintain 
patient medication profiles and patient notes, and explained the 
critical importance of this provision. Tr. 341, 518-23; see Ala. Admin. 
Code 680-X-2-.21(5). In addition to their internal documentation, Dr. 
Alverson testified that pharmacies in Alabama are required to report 
each dispensation of a controlled substance to the State's PDMP. Tr. 
507-08.
    Dr. Alverson explained the various warning signs--``red flags''--of 
diversion or abuse of which a pharmacist must be cognizant to protect 
the safety of the patient and community. These included: Doctor-
shopping; pharmacy-shopping; the doctor and practice specialty; \10\ 
over-prescribing or duplication of pain medication; traveling long 
distances to obtain or fill prescriptions; drug combinations 
susceptible to abuse, e.g., a combination of pain medication with 
anxiety medication and a muscle relaxant, which is informally referred 
to as a ``cocktail,'' and well-known as evidence of abuse or diversion; 
among others. Tr. 348-52, 401. In the face of these red flags, a 
pharmacist is expected to investigate the matter, to either satisfy her 
concerns or, failing that, to decline to fill the prescription. Tr. 
352, 391. Dr. Alverson explained the investigation would include steps 
such as interviewing the patient, calling the prescribing physician, 
reviewing the patient's records in the PDMP, and checking the Alabama 
Medical Board's website to determine the prescribing physician's 
registration status, location, and specialty. Tr. 378-381. If the 
pharmacist fills the prescription, the pharmacist is obliged to 
document the results of her investigation in the electronic patient 
notes or on the prescription and the documentation should always be 
contemporaneous. Tr. 353, 361, 378. These notes are used upon a 
patient's return to the pharmacy to demonstrate to the pharmacist or to 
the next pharmacist that red flags have been investigated and resolved, 
and to demonstrate that the pharmacist is practicing their due 
diligence. Tr. 353, 520.
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    \10\ Dr. Alverson testified that it is important to know the 
doctor's specialty to determine if a prescription is appropriate. 
She used the example of an oncologist prescribing higher doses of 
pain medication to end-stage/hospice patients. Tr. 351. As a counter 
example, she explained that she would question the appropriateness 
of a dentist prescribing 30 days of a pain medication for a tooth 
pull. Tr. 349.
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    Dr. Alverson discussed how pharmacists must use the professional 
judgment that they develop from education and training. Id. at 345. She 
explained that accredited pharmacy schools offer a class in pharmacy 
law covering both state and federal law and lessons on pharmacists' 
responsibilities under the law are integrated into the curriculum of 
other classes. Id. at 346. In order to obtain a pharmacy license, one 
must pass both a clinical examination, as well as a law exam, which 
covers both state and federal law. Id. Dr. Alverson testified that the 
corresponding responsibility of a pharmacist is included in the law 
exam and taught under the pharmacy school curriculum. Id. at 347. Dr. 
Alverson also emphasized that the Alabama Code of Professional Conduct 
requires a pharmacist to stay abreast of developments in the field, 
including patterns of abuse and diversion. Id. at 343-44; GX 24; Ala. 
Admin. Code 680-X-2-.22.
    In her testimony, Dr. Alverson reacted to the comments made to her 
at Auburn University by PIC Davison a month prior to the hearing to the 
effect the subject patients had already been on the subject medications 
when they reached the Respondent Pharmacy, and had

[[Page 53407]]

already developed addiction problems. Dr. Alverson deemed that 
rationale inconsistent with a pharmacist's responsibility, and 
suggested appropriate responses: Counsel the patient to see a different 
doctor, refer them to treatment programs, and refuse to fill such 
prescriptions. Tr. 447-48. Dr. Alverson also dismissed a suggestion 
that Respondent Pharmacy's responsibilities to investigate red flags 
were in some way lessened when the prescription was a transfer from 
another pharmacy--noting that a pharmacy should review transfer 
prescriptions the same as any new patient prescription. Id. at 453.
    Dr. Alverson reviewed a number of documents provided by the DEA 
including patient records from Respondent Pharmacy, corresponding 
prescriptions from those patients, and a record Respondent Pharmacy 
produced in response to a DEA subpoena. Dr. Alverson also reviewed 
records from the Alabama PDMP. She noted that from November 10, 2014, 
until December 1, 2014, the Respondent Pharmacy made no reports of 
dispensing controlled substances to the PDMP, despite the presence of 
original prescriptions evidencing the filling of controlled substances 
during that period. Id. at 393-95. On cross-examination, Dr. Alverson 
conceded that the pharmaceutical knowledge base was ever-growing and 
the professional standards ever-evolving, but confirmed that she 
evaluated the Respondent Pharmacy based upon the standards in place at 
the time of the dispensations. Id. at 460-73.
a. Patient M.A. (Male) \11\
---------------------------------------------------------------------------

    \11\ The parties stipulated that Respondent filled the following 
prescriptions for controlled substances for patient M.A. (male): on 
December 1, 2014, 30 tablets of carisoprodol 350mg and 120 tablets 
of hydrocodone-acetaminophen 10-325 mg; on December 8, 2014, 60 
tablets of oxycodone 15mg; on January 6, 2015, 30 tablets of 
carisoprodol 350mg, 120 tablets of oxycodone 15mg, and 120 tablets 
of hydrocodone-acetaminophen 10-325mg; on February 9, 2015, 30 
tablets of carisoprodol 350mg, 120 tablets of oxycodone 15mg, and 
120 tablets of hydrocodone-acetaminophen 10-325mg; on March 9, 2015, 
30 tablets of carisoprodol 350mg, 120 tablets of oxycodone 15mg, 120 
tablets of hydrocodone-acetaminophen 10-325mg, and 30 tablets of 
zolpidem 10mg; on April 13, 2015, 30 tablets of carisoprodol 350mg, 
120 tablets of oxycodone 15mg, 120 tablets of hydrocodone-
acetaminophen 10-325mg, and 30 tablets of zolpidem 10mg; on May 11, 
2015, 30 tablets of carisoprodol 350mg, 120 tablets of oxycodone 
15mg, 120 tablets of hydrocodone-acetaminophen 10-325mg, and 30 
tablets of zolpidem 10mg; on June 8, 2015, 120 tablets of oxycodone 
15mg, 120 tablets of hydrocodone-acetaminophen 10-325mg, and 30 
tablets of zolpidem 10mg; on July 13, 2015, 30 tablets of 
carisoprodol 350mg, 120 tablets of oxycodone 15mg, and 120 tablets 
of hydrocodone-acetaminophen; on August 17, 2015, 30 tablets of 
carisoprodol 350mg, 120 tablets of oxycodone 15mg, and 120 tablets 
of hydrocodone-acetaminophen. RD, at 3-4.
---------------------------------------------------------------------------

    For the first patient discussed, male M.A., Dr. Alverson noted that 
the patient arrived at Respondent Pharmacy in December 2014 with 
prescriptions for a risky combination of drugs, but that none of the 
records included any patient notes by PIC Davison, as would be expected 
in light of the red flags revealed by the prescriptions. Id. at 359-68, 
382, 494; GX 11, 22. The medications prescribed to M.A. included both 
hydrocodone and oxycodone, which are two opioid pain medications and 
respiratory depressants that ``potentiate'' each other, or magnify the 
other's effects. Tr. 369. These medications were coupled with 
carisoprodol, a muscle relaxant, which further acts to depress 
respiration. Id. at 368-70. Dr. Alverson testified that a responsible 
pharmacist would have investigated why this combination of drugs, all 
of which cause respiratory depression and work the same way, were 
prescribed and would have declined to dispense the drugs unless 
satisfied that she could dispense them safely. Id. at 377.
    Dr. Alverson noted that M.A.'s dose of pain medication (oxycodone) 
was doubled from 60 tablets to 120 tablets over a thirty-day period, 
when the best practice is to increase by no more than 25% at a time. 
Id. at 383-84. The increase also troubled Dr. Alverson, because the 
oxycodone was prescribed for breakthrough pain but was being prescribed 
at the level for a maintenance pain drug, id. at 386; and then, in June 
2015, the doctor switched which pain medication was for maintenance and 
which was for breakthrough pain, id. at 386-390. Dr. Alverson testified 
that this switch was a red flag for abuse because it indicated the 
doctor ``didn't really care about providing legitimate medical 
treatment.'' Id. at 390. In June 2015, the patient was also prescribed 
zolpidem, a fourth respiratory depressant. Id. at 385. In addition, 
patient M.A. continued to receive repeated refills of carisoprodol 
despite a Food and Drug Administration (FDA) approval saying that the 
drug should not be used for more than three weeks. Id. at 370.
    Dr. Alverson opined the prescribing pattern for M.A. was 
inconsistent with accepted pharmaceutical standards and posed a danger 
to the patient. Id. at 379, 502-03. She stated that in addition to an 
investigation at the initial prescription (of which there was no 
record), Respondent Pharmacy should have done further investigations 
based on the increased quantities and number of drugs prescribed. Id. 
at 391. Dr. Alverson found no indication in the records before her, 
which included copies of the front and back of the original hard-copy 
prescription and the patient's profile from Respondent's electronic 
system, that an appropriate, timely investigation was ever performed by 
the Respondent Pharmacy regarding the above-noted red flags. Id. at 
392, 500, 504. Dr. Alverson testified that the prescriptions should not 
have been filled without investigation, and that even if the pharmacist 
had completed an investigation and just failed to document the 
investigation, the lack of documentation is itself a violation of the 
standard of care in Alabama. Id. at 502-504.
b. Patient C.W.\12\
---------------------------------------------------------------------------

    \12\ The parties stipulated Respondent filled the following 
prescriptions for controlled substances for patient C.W. On December 
5, 2014, 30 tablets of carisoprodol 350mg; on December 9, 2014, 31 
tablets of alprazolam 2mg and 60 tablets of oxycodone 30mg; on 
January 16, 2015, 180ml of promethazine-codeine syrup; on February 
18, 2015, 90 tablets of oxycodone 30mg, 100 tablets of hydrocodone-
acetaminophen 10-325mg, and 30 tablets of alprazolam 2mg; on March 
18, 2015, 30 tablets of alprazolam 2mg and 30 tablets of 
carisoprodol 350mg; on June 15, 2015, 30 tablets of carisoprodol 
350mg, 30 tablets of alprazolam 2mg, another 30 tablets of 
alprazolam 2mg, 100 tablets of hydrocodone-acetaminophen, and 100 
tablets of oxycodone 30mg; on June 16, 2015, 180ml of promethazine-
codeine syrup; on July 15, 2015, 30 tablets of carisoprodol 350mg, 
30 tablets of alprazolam 2mg, 100 tablets of hydrocodone-
acetaminophen, and 100 tablets of oxycodone 30mg; on August 18, 
2015, 30 tablets of carisoprodol 350mg, 60 tablets of alprazolam 
2mg, 100 tablets of hydrocodone-acetaminophen, and 100 tablets of 
oxycodone 30mg. RD, at 4.
---------------------------------------------------------------------------

    The next patient discussed, C.W., had controlled substances 
prescribed by two different doctors--a red flag--as well as pain 
medication coupled with a muscle relaxant and benzodiazepine, or in Dr. 
Alverson's words a drug ``cocktail,'' as discussed above. Id. at 393, 
396-98; GX 10, 12, 22. Despite the red flags, Dr. Alverson found no 
evidence that any investigation was undertaken by the Respondent 
Pharmacy, which Dr. Alverson stated was contrary to what was expected 
of a pharmacist acting in the usual course of the retail pharmacy 
profession in Alabama. Tr. 399-400.
    The physician later added promethazine and codeine cough syrup to 
C.W.'s prescriptions, an additional controlled substance with a high 
street value. Id. at 401; GX 22, at 23. The patient also received an 
unusual increase in medication amounts and there was a three-month gap 
in treatment. Dr. Alverson noted no investigation evident by the 
Respondent Pharmacy into these, and other, red flags and said that 
without investigation and documentation a pharmacist within

[[Page 53408]]

the usual course of professional practice could not continue to fill 
prescriptions for C.W. Tr. 402-05.
c. Patient D.B.\13\
---------------------------------------------------------------------------

    \13\ The parties stipulated that Respondent filled the following 
prescriptions for controlled substances for patient D.B.: On 
December 2, 2014, 180 tablets of methadone 10mg and 90 tablets of 
carisoprodol 350mg; on December 29, 2014, 180 tablets of methadone 
10mg, 90 tablets of carisoprodol 350mg, and 90 tablets of alprazolam 
2mg; on January 20, 2015, 90 tablets of Lyrica 100mg; on January 26, 
2015, 210 tablets of methadone 10mg, 90 tablets of carisoprodol 
350mg, and 90 tablets of alprazolam 2mg; on February 23, 2015, 210 
tablets of methadone 10mg, 90 tablets of carisoprodol 350mg, 90 
tablets of alprazolam 2mg, and 90 tablets; on March 20, 2015, 210 
tablets of methadone 10mg, 90 tablets of carisoprodol 350mg, 90 
tablets of alprazolam 2mg, and 90 tablets of Lyrica 100mg; on April 
20, 2015, 210 tablets of methadone 10mg, 90 tablets of carisoprodol 
350mg, and 90 tablets of alprazolam 2mg; on May 11, 2015, 90 tablets 
of Lyrica 100mg; on May 18, 2015, 210 tablets of methadone 10mg, 90 
tablets of carisoprodol 350mg, and 90 tablets of alprazolam 2mg; on 
June 5, 2015, 90 tablets of Lyrica 100mg; on June 15, 2015, 210 
tablets of methadone 10mg, 90 tablets of carisoprodol 350mg, and 90 
tablets of alprazolam 2mg; on July 7, 2015, 150 tablets of methadone 
10mg, 90 tablets of carisoprodol 350mg, and 90 tablets of alprazolam 
2mg; on August 4, 2015, 90 tablets of Lyrica 100mg; on August 10, 
2015, 90 tablets of carisoprodol 350mg and 90 tablets of alprazolam 
2mg; on August 12, 2015, 180 tablets of methadone 10mg. RD, at 4-5.
---------------------------------------------------------------------------

    The third patient discussed, D.B., was prescribed 180 tablets of 
methadone-10 milligrams and 90 tablets of carisoprodol-350 milligrams 
by two different doctors. Tr. 413-14; GX 13, 22, 25.\14\ Dr. Alverson 
explained the heightened danger caused by methadone, as methadone 
creates its own form of sleep apnea and is responsible for a 
disproportionate number of deaths among the synthetic opioids, 
especially when prescribed in conjunction with another respiratory 
depressant, as was done for this patient. Tr. 414-15. Alprazolam, a 
benzodiazepine, was later added to this patient's prescription creating 
the red flag drug ``cocktail.'' Id. at 418-19. Dr. Alverson noted that 
as of September 1, 2016, alprazolam became the subject of a ``black 
box'' warning issued by the FDA, putting all pharmacists on notice of 
the heightened risk of fatal consequences when combining the drug with 
an opioid. Id. at 418-19, 495. Although the ``black box'' warning was 
issued after the subject prescription was filled, Dr. Alverson noted 
that the dangerous combination of alprazolam and opioids was well-known 
within the pharmacy community in 2014. Id. at 420. Despite the danger 
of D.B.'s prescriptions, no investigation by the Respondent Pharmacy 
was evident in the records reviewed by Dr. Alverson. Id. at 420-21.
---------------------------------------------------------------------------

    \14\ On cross-examination, Dr. Alverson conceded that her 
concern regarding prescriptions from two separate doctors would be 
alleviated by learning that they were partners at the same clinic. 
Tr. 514-15.
---------------------------------------------------------------------------

d. Prescriptions Issued by Dr. U.I.\15\
---------------------------------------------------------------------------

    \15\ The parties stipulated that Respondent filled the following 
prescriptions from Dr. U.I.: On April 28, 2015, 90 tablets of 
carisoprodol 350mg, 120 tablets of hydrocodone-acetaminophen 10-
325mg, and 60 tablets of alprazolam 1mg to [female] M.A.; on April 
30, 2015, 60 tablets of carisoprodol 350mg, 90 tablets of 
hydrocodone-acetaminophen 10-325mg, and 60 tablets of alprazolam 1mg 
to T.K.; on May 1, 2015, 30 tablets of zolpidem tartrate 10mg, 30 
tablets of lorazepam 1mg, 60 tablets of hydrocodone-acetaminophen 
10-325mg, and 60 tablets of carisoprodol 350mg to J.K. RD, at 5.
---------------------------------------------------------------------------

    Dr. Alverson then reviewed three prescriptions issued to three 
different patients by the same doctor, Dr. U.I., for the 
benzodiazepine/opioid/muscle relaxant ``cocktail.'' Tr. 421; GX 14. She 
noted that it was ``strange'' to see a physician write this combination 
of drugs repeatedly for a variety of patients and was indicative of a 
problem because the ``cocktail'' is rarely prescribed for legitimate 
medical reasons. Tr. 421-22. Dr. Alverson also found it highly 
suspicious that two of the three patients shared the same last name and 
lived at the same address, suggesting they were related. Id. at 422. 
She stated that it would be extraordinarily rare for two people living 
at the same address to receive this combination of drugs for legitimate 
medical purposes. Id. at 424. Dr. Alverson opined that after the second 
cohabitant presented a prescription for this cocktail, Respondent 
Pharmacy should have declined to fill the prescription and that a 
pharmacist could not fill the prescription consistent with their 
professional responsibilities.
e. Prescriptions Issued by Dr. S.H.\16\
---------------------------------------------------------------------------

    \16\ The parties stipulated that on August 13, 2015, Respondent 
dispensed 84 tablets of oxycodone 15mg to patient T.M., 112 tablets 
of oxycodone 30mg to patient P.I., and 112 tablets of oxycodone 30mg 
to patient J.C. based on prescriptions issued by Dr. S.H. RD, at 5.
---------------------------------------------------------------------------

    Dr. Alverson also reviewed several opioid prescriptions issued by 
the same doctor, Dr. S.H., to three separate patients, which were 
filled at the Respondent Pharmacy within minutes of each other, 
suggesting the patients arrived together. Tr. 427-28; GX 15. Dr. 
Alverson described this circumstance as suspicious, in that, three 
patients from different parts of the area would be highly unlikely to 
appear together at the same pharmacy at the same time, unless they were 
involved in diversion. Tr. 429-33.
f. Patient A.C.\17\
---------------------------------------------------------------------------

    \17\ The parties stipulated that on September 23 and 24, 2015, 
Respondent dispensed 30 tablets of carisoprodol 350mg and 30 tablets 
of hydrocodone-acetaminophen 7.5-325mg to A.C. RD, at 5.
---------------------------------------------------------------------------

    Dr. Alverson's review of patient A.C.'s records revealed a patient 
who was prescribed opioids by multiple doctors and filled at multiple 
pharmacies within a 30-day period, which was suggestive of doctor-
shopping and pharmacy-shopping. Tr. 434-38; GX 16, 28. Dr. Alverson 
noted that a review of the PDMP by the pharmacist would have disclosed 
these suspicious circumstances. For example, if PIC Davison had 
reviewed the PDMP before dispensing a prescription of hydrocodone to 
A.C. on September 24, 2015, she would have seen that A.C. had five 
different prescriptions for hydrocodone in the previous month. Tr. 438; 
GX 28. Dr. Alverson stated that, under the circumstances, the 
prescriptions should not have been filled, and the prescribing doctors 
and the police should have been notified. Tr. 439-440.
g. Patient R.D.\18\
---------------------------------------------------------------------------

    \18\ The parties stipulated that Respondent that on October 11, 
2014, Respondent dispensed 90 tablets of oxycodone 30mg to R.D., and 
on October 6, 2014, Respondent dispensed 120 tablets of hydrocodone-
acetaminophen 10-325mg and 90 tablets of alprazolam 2mg to R.D. RD, 
at 5-6.
---------------------------------------------------------------------------

    The Respondent Pharmacy filled opioid prescriptions for patient 
R.D., which turned out to be forgeries. The filled prescriptions 
included a month's supply of hydrocodone and a month's supply of 
oxycodone, which Respondent Pharmacy filled within a week of each 
other. Id. at 441; GX 17. Dr. Alverson testified that there is no 
``logical reason'' narcotics would be prescribed in this way and that 
an Alabama pharmacist acting in the bounds of her profession would be 
expected to investigate the prescriptions by calling the prescriber and 
checking the PDMP. Tr. at 441; see also, GX 31, at 26. Dr. Alverson 
conducted a brief investigation of the prescriptions by accessing the 
Alabama Medical Board website, which revealed the prescribing doctor to 
be an OB-GYN. Tr. at 444-45. Patient R.D. was a man. Id. at 445.

D. Testimony of Dr. Santonia Davison

    PIC Davison was born in Bessemer, Alabama, attended the local high 
school, graduated from Miles College with a B.S. in biology, and then 
graduated from Samford University with a Doctorate of Pharmacy in 2011. 
Tr. 530-31. PIC Davison began her pharmacy career at CVS Pharmacy, 
where she ultimately worked at all 43

[[Page 53409]]

stores within the district. Id. at 532. The CVS stores shared the same 
policies and procedures and computer programs. Id. at 535-36. Their 
pharmacy computer program performed many pharmacist functions 
automatically, including a ``medication conflict check,'' a drug 
interaction check, and a therapeutic duplication check. Id. at 536. 
When the program recognized a problem with a prescription, the 
interactive program required the pharmacist to check a box designating 
how the pharmacist resolved the issue, such as, ``review of patient 
history,'' ``medication review,'' and ``prescriber consult,'' before 
the system would permit a prescription to be filled. The CVS software 
also allowed the pharmacists to make patient notes and automatically 
reported each prescription dispensed to the PDMP. Id. at 541. PIC 
Davison reported that although the combination of an opioid and a 
benzodiazepine would trigger an alert for ``therapeutic duplication,'' 
CVS had no official policy restricting the filling of that drug 
combination between 2011 and 2013. Id. at 538.
    PIC Davison left CVS in 2013 in preparation for opening her own 
pharmacy. Id. at 538. She opened Respondent Pharmacy, Heavenly Care 
Pharmacy, on May 26, 2014, as the Pharmacist-in-Charge. Id. at 539, 
693. PIC Davison developed the policies and procedures for the pharmacy 
by borrowing from ``care pharmacy'' association and from CVS. Id. at 
540. She purchased her pharmacy software system from Abacus. Id. 
Although similar to the CVS software, PIC Davison testified the Abacus 
software became unreliable in automatically reporting dispensed 
prescriptions to the PDMP. Id. at 541. After discussions with DEA 
officials regarding missing PDMP data, which included a three-week 
lapse in reporting to the PDMP, PIC Davison began manually reporting to 
the PDMP. Id. at 541-42, 619, 753-55. PIC Davison explained that the 
Respondent Pharmacy also submitted a file to the PDMP that included 
data from the time the pharmacy opened. Id. at 753-55.
    PIC Davison described her understanding of her record-keeping 
responsibilities as an ongoing process, prompted by the visits to her 
pharmacy by DEA. Id. at 558-60, 812. PIC Davison conceded that she had 
not properly documented the ordering and receipt of controlled 
substances to the pharmacy through inadvertence, computer issues, 
prioritizing patient consultation over record-keeping, and 
procrastination. Id. at 560-80, 675, 689-92. PIC Davison apologized for 
her ``lack of documentation [causing] all of this uproar.'' Id. at 691.
    PIC Davison's testimony then addressed the specific prescriptions 
the Government identified in the Order to Show Cause and the ``red 
flags'' on those prescriptions that Dr. Alverson discussed in her 
testimony. See Tr. 591-671. PIC Davison described her personal 
interactions with the subject patients. PIC Davison testified that she 
was certain or ``pretty sure'' that she had contacted the prescribing 
physicians for all patients other than patient R.D. (the patient who 
presented the forged prescription). Id. at 608-09, 620-28, 630-31, 635, 
640, 651, 659, 666, 670, 751. PIC Davison described her discussions 
with the doctors in her testimony but was largely unable to produce any 
contemporaneous documentation of those discussions.\19\ Id.; GX 19, 22 
(Respondent's responses to Government subpoenas requesting the 
documentation). For some of the patients, she conceded that no 
documentation existed and that she made a mistake not to document her 
investigations. Id. at 602, 608-09. For other patients, PIC Davison 
testified that the documentation would have been written on the 
original prescription, usually on the first fill script, but that those 
prescriptions were seized by the DEA, and were not offered into 
evidence. Id. at 634-35, 637-38, 641, 663-64, 673.\20\ PIC Davison 
stated she now records her notes both on the original prescription and 
electronically in her patient notes. Id. at 674.
---------------------------------------------------------------------------

    \19\ There was a handwritten note on one of patient C.W.'s 
prescriptions documenting PIC Davison's discussion with the doctor 
regarding a missing dosage on a prescription. Tr. 612; see GX 12, at 
17.
    \20\ This testimony was permitted over the Government's 
objection that it was not properly noticed within the Respondent 
Pharmacy's Prehearing Notices. Tr. 663. However, the ALJ determined 
that Respondent Pharmacy's Prehearing statements provided adequate 
notice that this was part of its defense. Tr. 663; ALJX 17, at Ex. A 
2, 15; GX 19, 47.
---------------------------------------------------------------------------

    PIC Davison testified that she checked the PDMP before filling 
prescriptions for some, but not all, of the subject patients.\21\ For 
male patient M.A., PIC Davison could not recall if she had searched the 
PDMP prior to filling his prescriptions, but when shown the record of 
her PDMP searches, which she had produced for the hearing, conceded the 
record showed she did not conduct a search. Id. at 744-45; RX 1, at 39 
and 40. PIC Davison also said that she did not check the PDMP before 
filling the forged prescription for patient R.D. Tr. 795. PIC Davison 
affirmatively testified that she checked the PDMP for patients C.W., 
A.C., and one of Dr. S.H.'s patients, patient T.M. Tr. 609, 652, 658, 
670. On cross examination, the DEA attorney questioned PIC Davison on 
her decisions to fill certain prescriptions for C.W. and A.C. after 
having viewed their prescription history in the PDMP. For C.W., PIC 
Davison testified that she did not recall seeing on the PDMP report 
that C.W. had received ten months of alprazolam in the prior five 
months. She explained that perhaps there was a software error, or that 
she had only reviewed the previous 30 days of the patient's history, or 
maybe that she just did not notice it. Id. at 764-66. For Patient A.C., 
PIC Davison testified that she had checked the PDMP report on A.C. on 
July 14, 2015, and had declined to fill one of A.C's pain medication 
prescriptions, because it was too early for a refill according to the 
PDMP. Id. at 670. PIC Davison also stated that the Government may have 
improperly attributed PDMP data to patient A.C., because the PDMP 
report used by the Government compiled data from patient profiles with 
the same name and birthdate but with four different street addresses in 
Bessemer, Alabama. Id. at 788-91.
---------------------------------------------------------------------------

    \21\ PIC Davison stated on cross that ``at first, I wasn't using 
the PDMP because it wasn't being reported daily.'' Tr. 758.
---------------------------------------------------------------------------

    As to the two patients with the same last name, living at the same 
address, PIC Davison did not recognize that coincidence as being 
concerning, as family members often see the same physician, but stated 
that after her interactions with DI Two, she now knows it is something 
a pharmacy should explore. Id. at 640-47; see Tr. 421; GX 14. Regarding 
the three patients who apparently came to the pharmacy together with 
similar prescriptions, yet from different parts of the area, PIC 
Davison explained that two of the three patients, P.I. and T.M., 
carpooled, because P.I. had an arm amputation. Tr. 650. PIC Davison 
stated that both lived in Jasper, Alabama. Id. at 665.\22\ P.I. and 
T.M. had difficulty finding their prescribed medications, which were 
available at the Respondent Pharmacy. Id. at 651. The third of the 
trio, J.C., was a local individual, who frequented a commercial 
cleaning business a few doors down from the Respondent Pharmacy. Id. at 
665-67. For these reasons, the appearance of these three individuals 
arriving at the Respondent Pharmacy at the same time did not raise any 
concerns for PIC Davison. Id. at 668-69; see id. at 427-28; GX 15. PIC 
Davison explained that she ``figured that perhaps the doctor [at the 
pain

[[Page 53410]]

management clinic] scheduled them all the same day.'' \23\ Tr. 669.
---------------------------------------------------------------------------

    \22\ However, according to the scripts in evidence, P.I. lived 
in Jasper at the time her script was filled, while T.M. lived in 
Quinton. GX 15.
    \23\ Based on the copies of the prescriptions, which were 
submitted into evidence and stipulated by the parties to be true and 
correct copies, the prescriptions for P.I. and T.M were issued on 
the same day, July 30, 2015. The prescription for J.C. was issued 
the following day, July 31, 2015. The three patients did not bring 
the prescriptions to Respondent Pharmacy to be filled until August 
13, 2015, approximately two weeks after the prescriptions were 
issued. GX 15.
---------------------------------------------------------------------------

    PIC Davison testified that she gave less scrutiny to prescriptions 
from pain management clinics, because she thought they had procedures 
to detect abuse and diversion, such as pill counts and urine analysis. 
Id. at 653-54, 784-85. Similarly, PIC Davison acknowledged she did not 
scrutinize transfers from other pharmacies as she did new patients. She 
reported that she had confidence that prescriptions filled at other 
pharmacies were proper, explaining that all pharmacists are under the 
same obligation and liability to perform their jobs as she. Id. at 628. 
PIC Davison said she now scrutinizes transfers as she would a new 
patient. Id. at 629.
    The ALJ found that PIC Davison's testimony lacked credibility. RD, 
at 58. He stated that ``[i]n testifying as to factual matters regarding 
the initial inventory, the timing and extent of her purported 
investigations, and documentation of her investigations, [PIC] 
Davison's testimony was marked with a level of equivocation, 
implausibility, and inconsistency . . . .'' Id. I concur.

E. Allegations That Respondent Filled Prescriptions Without 
Investigating and Resolving Red Flags

    The Government alleged that Respondent filled prescriptions that 
displayed red flags of abuse and diversion without resolving those red 
flags in violation of the pharmacist's corresponding responsibility to 
assess the legitimacy of the prescription. To support its allegations, 
the Government presented hard copies of prescriptions; copies of 
Respondent's electronic profiles for these patients; and the expert 
testimony of Dr. Alverson regarding the red flags presented by the 
patients' prescriptions. Respondent disputes the allegations and argues 
that she upheld her corresponding responsibility to assess the 
legitimacy of all of the subject prescriptions. In defense of these 
allegations, PIC Davison testified at the hearing regarding the due 
diligence that she conducted on the prescriptions and presented written 
summaries of her investigations in response to a Government subpoena 
and in a prehearing statement.\24\
---------------------------------------------------------------------------

    \24\ In addition to the testimony and evidence described below 
regarding the subject prescriptions, PIC Davison also supplied 
testimony and medical articles related to correlations between race 
and prescribing of controlled substances. See Tr. 679-686; RX 2. PIC 
Davison testified that these articles demonstrated that the medical 
establishment was less likely to prescribe opioid pain medications 
to Black patients. Tr. 684-86. In the course of her testimony and in 
Respondent's Prehearing Statement, PIC Davison stated some of the 
patients with prescriptions at issue in this case are Black, some 
white, and did not provide testimony on the race of others. See, 
e.g., ALJX 17, Ex. A. PIC Davison testified, however, that the 
information in the articles did not influence the scrutiny she 
applied to prescriptions for controlled substances and that she 
engaged in the same level of scrutiny regardless of the race of the 
patient. Tr. 798-801. PIC Davison stated that she does not consider 
the race of the patient when determining whether an investigation is 
necessary when presented with prescriptions for controlled 
substances; therefore, I conclude that this evidence is irrelevant 
to the allegations that PIC Davison failed to properly investigate 
and document her investigation into any red flags presented by the 
subject prescriptions.
---------------------------------------------------------------------------

    As Dr. Alverson explained in her expert testimony regarding the 
standards of practice for an Alabama pharmacist, which is summarized in 
further detail supra at I.C.3, pharmacists are required under Alabama 
law to review each prescription for, among other things, therapeutic 
duplication, drug-drug interactions, incorrect dose/duration, and 
clinical abuse/misuse of medications. Ala. Admin. Code 680-X-2-.21. The 
law also requires pharmacists to maintain patient medication profiles, 
which includes the pharmacists' comments on consultation with the 
patient. Id.
    Dr. Alverson identified various red flags that pharmacists are 
trained to be aware of to identify suspicious and unlawful 
prescriptions, which include patients traveling significant or unusual 
distances, patterns from prescribers who repeatedly issue prescriptions 
or groupings of prescriptions for drugs susceptible to abuse or misuse 
(``pattern prescribing''), doctor or pharmacy shopping, different 
family members who receive substantially similar prescriptions, 
prescribers issuing prescriptions for large quantities of narcotics or 
other controlled substances, and prescriptions that are therapeutically 
duplicative or other combinations that do not make clinical sense with 
each other or do not make sense for the patient. Dr. Alverson testified 
that, at the time the subject prescriptions were filled, an Alabama 
pharmacist would be expected to know about the red flags she identified 
and emphasized that the Alabama Code of Professional Conduct requires a 
pharmacist to stay abreast of developments in the field, including 
patterns of abuse and diversion. Id. at 343-44; GX 24; Ala. Admin. Code 
680-X-2-.22. She further testified that when such red flags are 
present, Alabama pharmacists, acting in the normal course of their 
professional practice and in fulfillment of their corresponding 
responsibility, will investigate the circumstances, document their 
investigation, and decline to fill the prescription if they cannot 
resolve the red flags. Pharmacists will generally document the 
investigation as part of the ``comments'' maintained within the patient 
profiles the pharmacist is required by law to maintain, but they can 
also put the documentation on the prescriptions themselves.
    The Government and Respondent Pharmacy presented conflicting 
testimony on two overarching factual matters relevant to Respondent's 
investigation and resolution of red flags, or lack thereof, for the 
prescriptions at issue. First, Respondent claims to have conducted due 
diligence investigations for all of the prescriptions at issue, but the 
Government suggests that any reported investigation by Respondent 
Pharmacy occurred after the fact, following the initiation of the 
Agency investigation. The Government supported this allegation by 
eliciting testimony demonstrating how the Respondent Pharmacy's 
explanations changed in reaction to the Government's filings. The 
Government subpoenaed certain of Respondent Pharmacy's patient records 
in February 2016 and May 2016, including any records Respondent 
Pharmacy held regarding the subject prescriptions. GX 18; Tr. 721. 
Respondent Pharmacy did not provide any records with contemporaneous 
documentation of investigations for any of the subject prescriptions in 
response, instead providing a single document describing its due 
diligence as to these patients in narrative form and the relevant 
patient profiles (the profiles required by Alabama law) none of which 
contained pharmacist comments. See GX 19; GX 22; Tr. 723. The 
Respondent Pharmacy's due diligence, described in Government Exhibit 
19, were mostly in summary form, and except for one prescribing 
physician, did not include calls to the prescribing doctor as part of 
its due diligence. In fact, for a number of patients, PIC Davison 
reported, ``I cannot remember anything about this patient.'' GX 19.
    The Government noted that following the Respondent Pharmacy's 
review of Dr. Alverson's report, the Respondent Pharmacy bolstered its 
claimed due diligence in its Prehearing statement to include steps 
described by Dr. Alverson

[[Page 53411]]

as necessary due diligence. Govt Posthearing, at 22-24; Tr. 728-39, 
778-81.
    Respondent Pharmacy categorically denies this allegation and 
detailed investigations on several of the subject patients in PIC 
Davison's testimony. Respondent Pharmacy argues that its claims of 
extensive, timely investigations were uncontroverted and should be 
accepted as credible. The ALJ, however, found, and I agree, that PIC 
Davison's testimony was ``sometimes implausible and inconsistent'' and 
described her testimony of one patient investigation as ``misleading 
and equivocating.'' RD, at 58.
    I agree with the ALJ's finding that it is more believable than not 
that Respondent Pharmacy's investigations were not as timely or 
extensive as PIC Davison testified. RD, at 48. See Wilbur-Ellis Co. v. 
M/V Captayannis ``S'', 451 F.2d 973, 974 (9th Cir. 1971) (the court is 
not bound to accept uncontroverted testimony at face value if it is 
improbable, unreasonable, or otherwise questionable) (citing Quock Ting 
v. United States, 140 U.S. 417, 420-21 (1891)); Koivunen v. States 
Line, 371 F.2d 781, 783 (9th Cir. 1967) (evidence of witnesses, 
especially those who have a biased or prejudiced interest in the result 
of the trial in which they testify, need not be accepted at face 
value). Respondent Pharmacy has provided no documentary evidence in 
support of its claims of timely investigation. Furthermore, as the ALJ 
found, the propensity of the subject prescription forgery ring to 
concentrate their efforts at Respondent Pharmacy strongly suggests that 
the criminal diversion community had identified Respondent Pharmacy 
``as a location where investigation was minimal and diversion would 
likely be successful.'' RD, at 48. See Tr. 431 (testimony from Dr. 
Alverson that patients seeking legitimate pain management do not tend 
to travel in groups, but that those not seeking legitimate pain 
management do, because they learn which pharmacies will fill their 
prescriptions).
    As to the second preliminary matter, Respondent Pharmacy alleged in 
its Prehearing Statement that PIC Davison noted the results of her 
investigations on the initial prescriptions of the patients (first fill 
prescriptions), however, these prescriptions were seized by DEA, and 
while they were not listed as evidence, they were not returned to her. 
See ALJX 17, Ex. A, at 2, 15. At the hearing, however, PIC Davison was 
less certain about recording the results of her patient investigations 
on the initial prescriptions and only conditionally indicated that if 
she recorded her investigation, it would have been on the initial 
prescription, or in her patient notes. Tr. 634-35, 637-38, 663-64, 673, 
805.
    The Government did not offer all of the subject ``missing'' first 
fill prescriptions into evidence. In past cases, this Agency has 
applied the ``adverse inference rule'' against parties that failed to 
produce records. See, e.g., Pharmacy Doctors Enterprises d/b/a Zion 
Clinic Pharmacy, 83 FR 10,876, 10,890 (2018) pet. for rev. denied, 789 
F. App'x 724 (11th Cir. 2019). As the D.C. Circuit explained, 
``[s]imply stated, the rule provides that when a party has relevant 
evidence within his control which he fails to produce, that failure 
gives rise to an inference that the evidence is unfavorable to him.'' 
Int'l Union, United Auto., Aerospace & Agric. Implement Workers of Am. 
(UAW) v. Nat'l Labor Relations Bd., 459 F.3d 1329, 1336 (D.C. Cir. 
1972). See also Huthnance v. District of Columbia, 722 F.2d 371, 378 
(D.C. Cir. 2013). In this case, however, I agree with the ALJ that the 
Respondent Pharmacy's conditional assertion of favorable evidence under 
the sole control of the Government is insufficient to justify an 
adverse inference. RD, at 43 (citing Beau Bashers, 76 FR 194,401, 
19,404 (2011); UAW v. NLRB, 459 F.2d at 1335-39). The credibility of 
Respondent's conditional assertions of favorable evidence is also drawn 
into question by the first fill prescriptions the Government did 
produce, none of which contained documentation of Respondent's alleged 
investigations. Furthermore, PIC Davison failed to produce any 
prescriptions with documentation of an investigation for any 
prescription filled at Respondent Pharmacy--documentation that she was 
required to make as an Alabama pharmacist--and conceded that she failed 
to document the results of her investigation for several of the subject 
prescriptions, relying instead on her memory.
1. Prescriptions for Patients M.A., C.W., and D.B.
    The Government alleged that from December 2014 through August 2015, 
Respondent filled prescriptions for patients M.A. (male), C.W., and 
D.B. for large quantities of narcotics, in combinations reflecting 
therapeutic duplication, in combinations known to be susceptible to 
abuse or diversion, and unlikely to be issued for legitimate medical 
purposes by prescribers operating within the bounds of their 
profession. The Government further alleged that Respondent filled these 
prescriptions without appropriate investigation, documentation, and 
resolution of these circumstances in violation of its corresponding 
responsibility. ALJX 1, at 3.
    In regard to patient M.A. (male), Dr. Alverson testified that his 
prescriptions presented multiple red flags: Therapeutic duplication; a 
rapid increase in the quantity of a prescribed opioid; the prescriber 
switching which drug was for maintenance and which for breakthrough 
pain; and repeated refills of a drug contrary to FDA approval. Dr. 
Alverson opined the prescribing pattern for M.A. was inconsistent with 
accepted pharmaceutical standards and posed a danger to the patient. 
Tr. 379, 502-03. She further found no contemporaneous documentation on 
the record that PIC Davison had conducted any investigation of the red 
flags.\25\ PIC Davison acknowledged at the hearing that she did not 
document her investigation, but testified that she determined the 
prescriptions were appropriate based on conversations with the patient 
and the prescribing physician which revealed M.A. was a delivery driver 
who suffered from chronic back pain.\26\ Id. at 593-96.
---------------------------------------------------------------------------

    \25\ In its Prehearing Statement, Respondent wrote that any 
documentation for PIC Davison's investigation of patient M.A. (male) 
would be on the original fill prescription. The Government 
introduced the original fill prescription into evidence. It 
contained no documentation by PIC Davison. See GX 11.
    \26\ In its Prehearing Statement, Respondent stated that PIC 
Davison had contacted the prescribing physician to confirm the 
diagnosis and validity of the prescription and to discuss safety and 
possible therapeutic duplication. GX 47, at 4. During the hearing, 
however, PIC Davison's testimony on this matter wavered. She 
testified that she spoke with the prescribing physician on the phone 
regarding M.A.'s consecutive therapies and ``why Soma was prescribed 
with two different narcotics,'' Tr. 727-28, but later admitted that 
she could only specifically recall calling the doctor to discuss a 
change in the prescription from extended-release to immediate-
release oxycodone, Tr. 751.
---------------------------------------------------------------------------

    For patient C.W., Dr. Alverson testified that the patient's 
prescriptions presented several red flags including controlled 
substances prescribed by different doctors, the combination of an 
opiate and a benzodiazepine or ``drug cocktail'' popular with drug 
abusers, an unusual increase in medication amounts, and a three-month 
gap in treatment. Id. at 393, 396-98, 401-404. PDMP data for C.W. that 
Respondent Pharmacy submitted into evidence also revealed red flags 
including that C.W. had frequented multiple pharmacies and received 10 
months of alprazolam in the five months prior to transferring his 
prescription to Respondent Pharmacy. Tr. 761-62; RX 1, at 14-16. 
Despite the evidence of red flags, there was no evidence that 
Respondent

[[Page 53412]]

Pharmacy undertook any investigation. PIC Davison said she conducted 
due diligence on C.W.'s prescriptions by talking with the patient, who 
told her he was a factory worker doing repetitive actions, and that she 
was ``pretty sure'' she called the prescribing doctor before filling 
C.W.'s prescriptions for the first time. Tr. 608. PIC Davison also 
suggested that the PDMP report she viewed in December 2014, when C.W. 
came to Respondent Pharmacy, could have looked different than the one 
she offered into evidence at the hearing, but she offered no evidence 
to support her claim. Id. at 763-66.
    For patient D.B., Dr. Alverson testified that the patient's 
prescriptions evinced several red flags including doctor shopping and 
the opioid/benzodiazepine ``cocktail.'' Supra I.C.3.c. PIC Davison 
discussed the investigation she conducted on patient D.B., but yet 
again conceded she failed to properly document it. Tr. 620-28, 630. PIC 
Davison testified that she was not suspicious that D.B. paid for her 
carisoprodol prescription with cash, while her other prescriptions were 
covered by insurance or Medicare. Tr. 768-69, 810; RX 1, at 27.
    For both C.W. and D.B., PIC Davison argued that at the time the 
subject prescriptions were filled, 2014-15, the opioid/benzodiazepine 
drug combination was not known to be a red flag and that a reasonable 
pharmacist at the time would not necessarily be suspicious of 
prescriptions with that drug combination. To support her argument, PIC 
Davison submitted evidence that the U.S. Department of Health and Human 
Services (HHS) issued guidelines in March 2016 regarding the risks of 
opioid pain medications, after the subject prescriptions were issued. 
See RX 2, at 9. However, Dr. Alverson, who Respondent conceded was a 
renowned expert in the field, testified that while HHS did not issue 
those guidelines or add a ``black box'' \27\ warning to benzodiazepines 
that they should not be combined with an opioid until 2016, the dangers 
of the ``cocktail,'' and its propensity for abuse, were well known in 
the pharmacy community in 2014. Tr. 420, 494. She further testified 
that when reviewing the subject prescriptions, she applied the 
standards of professional practice that were applicable at the time of 
the dispensations. Id. at 460-73. I credit Dr. Alverson's testimony on 
this matter and find that, at the time Respondent Pharmacy dispensed 
the subject prescriptions to C.W. and D.B., an Alabama pharmacist 
should have been aware of the risks posed by an opioid/alprazolam drug 
combination.
---------------------------------------------------------------------------

    \27\ Dr. Alverson testified that a ``black box'' warning is a 
type warning that is required to be placed on the package insert for 
certain drugs and is formatted with a black border around that text. 
Tr. 419.
---------------------------------------------------------------------------

    Based on the evidence in the record, I find that Respondent filled 
prescriptions for patients M.A. (male), C.W., and D.B. that raised red 
flags and that PIC Davison knew or should have known that the 
prescriptions raised red flags.\28\ I further find that, even if these 
red flags were resolvable, there was no credible evidence that 
Respondent addressed or resolved them before filling the prescriptions. 
I cannot, and do not, place any weight on PIC Davison's testimony that 
she resolved the red flags, because she produced no contemporaneous 
documentary evidence to support her claim that she attempted to and, in 
fact, did resolve them before filling the prescriptions and because the 
ALJ found, and I agree, that her testimony on this matter was not 
credible. See RD, at 56.
---------------------------------------------------------------------------

    \28\ In a prehearing statement, Respondent argued that M.A., 
C.W., and D.B. had the same or similar prescriptions filled at other 
area pharmacies before or after they were patients at Respondent 
Pharmacy and that this demonstrates the ``common prescribing 
practices amongst the physicians in the area.'' GX 47, at 5-7. 
Respondent supported this argument with data from the PDMP that it 
presented as evidence during the hearing. RX 1, at 1-17, 43-58. The 
best that this evidence shows, however, is that the red flags 
presented by M.A., C.W., and D.B.'s prescriptions may be resolvable 
with proper investigation. At worst, it shows that in some cases the 
patients had to go to several pharmacies to receive the same 
combination of drugs they received from Respondent Pharmacy. I will 
not fully explore this argument because Respondent seems to have 
abandoned it by failing to elicit testimony at the hearing and not 
discussing it in its Posthearing brief.
---------------------------------------------------------------------------

2. Prescriptions Issued by Dr. U.I.
    From April 2015 to August 2015, Respondent Pharmacy filled 
prescriptions issued by prescriber U.I. RD, at 5. The Government 
alleged that three patients of Dr. U.I. ``presented prescriptions that 
indicated a pattern of prescribing the same combinations of controlled 
substances to patient after patient, combinations including large 
quantities of narcotics and combinations known to be susceptible to 
abuse or diversion and unlikely to be issued for legitimate purposes by 
prescribers operating within the bounds of their profession.'' ALJX 1, 
at 4. The Government additionally alleged that ``these patterned 
prescriptions were presented by patients who shared the same home 
address and last name, issued within one date of one another.'' Id. The 
Government further alleged that Respondent filled the prescriptions 
with red flags from Dr. U.I. to numerous patients without appropriate 
investigation, documentation, and resolution of the alleged red flags. 
Id.
    To support these allegations, the Government submitted 
prescriptions into evidence from Dr. U.I. for patients M.A. (female), 
T.K, and J.K. GX 14. Dr. Alverson testified that these prescriptions 
showed red flags. Tr. 421. All three patients were prescribed a 
combination of an opioid, benzodiazepine, and a muscle relaxant--a drug 
``cocktail'' known to be susceptible to diversion and abuse--and a red 
flag in and of itself. Dr. Alverson testified that a pattern of 
prescriptions from a prescriber for this ``cocktail'' is also a red 
flag because the ``cocktail'' is rarely prescribed for legitimate 
medical reasons and further, that it would be extraordinarily rare for 
two people living at the same address to receive this ``cocktail'' for 
legitimate purposes. Tr. 421-22.
    PIC Davison testified that she was ``pretty sure'' she had 
investigated the prescriptions from Dr. U.I. by calling the doctor, Tr. 
635-43,\29\ but she did not claim to have conducted any due diligence 
on prescriptions from Dr. U.I. in either her response to the 
Government's subpoena, GX 19, or in the Prehearing statement, where she 
summarized the due diligence she conducted on the subject 
prescriptions, GX 47, at 8. During the hearing, PIC Davison stated that 
two patients sharing an address and receiving similar controlled 
substances ``would raise a flag,'' but also testified that at the time 
she did not think it was a red flag for two patients with the same last 
name, living at the same address, to receive prescriptions for the same 
doctor, because, in her experience, family members often see the same 
physician. She conceded, however, that she learned this circumstance 
should be investigated by pharmacies during her discussions with DI 
One. Tr. 645-47.
---------------------------------------------------------------------------

    \29\ PIC Davison testified that she would have written any 
documentation of her investigations on the first fill script of the 
patients M.A. (female) and T.K. but that the DEA had taken those 
scripts and not submitted them into evidence. Tr. 638-42. As 
discussed, supra, I do not give weight to PIC Davison's testimony on 
this matter. The Government did submit copies of the front and back 
of the first fill script from patient J.K., which did not contain 
any documentation of an investigation by Respondent. GX 14 at 5-6.
---------------------------------------------------------------------------

    Based on the evidence in the record, I find that Respondent filled 
prescriptions from prescriber U.I. that raised red flags that PIC 
Davison knew or should have known that the prescriptions raised red 
flags. I further find that, even if these red flags were resolvable, 
there was no credible evidence that Respondent addressed or resolved 
them before filling the

[[Page 53413]]

prescriptions. I cannot, and do not, place any weight on PIC Davison's 
testimony that she resolved the red flags because she produced no 
contemporaneous documentary evidence to support her claim that she 
attempted to and, in fact, did resolve them before filling the 
prescriptions and because the ALJ found that the testimony was not 
credible. See RD, at 56.
3. Prescriptions Issued by Dr. S.H.
    On August 13, 2015, Respondent filled three different prescriptions 
for oxycodone presented by three different patients from Dr. S.H. in 
Moody, Alabama. RD, at 5. The Government alleged the patients traveled 
unusual distances to obtain and fill the prescriptions, and that the 
timing of the prescription fills indicates the patients may have 
traveled together, and that despite these circumstances, Respondent 
``filled the prescriptions without appropriate investigation, 
documentation, and resolution of these circumstances.'' ALJX 1, at 4.
    The Government presented testimony at the hearing that Moody, 
Alabama, where the prescribing physician was located, is on the 
southeast-side of Birmingham and approximately a 40-minute drive from 
Respondent Pharmacy; that Jasper, Alabama, where one of the patients 
resided, is on the north-side of Birmingham and approximately a 50-
minute drive from Respondent Pharmacy; and that Quinton, Alabama, where 
a second patient resided, is proximate to Jasper. Tr. 428-29. The third 
patient resided in Bessemer, Alabama, the same city as Respondent 
Pharmacy. The Government presented prescriptions from the patients with 
dispensing labels showing they were filled at Respondent Pharmacy 
within minutes of one another. GX 15. Dr. Alverson testified that it is 
a red flag for patients from three different cities to visit the same 
doctor in a fourth city ``quite a distance from where they live,'' to 
receive prescriptions from that prescriber for the same controlled 
substance, and then to take those prescriptions to the same pharmacy at 
the same time (and at a pharmacy that is distant from the residence of 
two of the three patients). Tr. 429-32. She further testified that 
patients seeking legitimate pain management care do not tend to travel 
in groups, but that it is a common practice for patients abusing or 
diverting drugs to do so, because ``patients who are seeking drugs 
usually learn pretty quickly the physicians that will write those 
prescriptions for them, and they learn which pharmacies will fill those 
prescriptions . . . . With no questions asked.'' Id. at 431-32.
    PIC Davison testified that she ``sort of, but not really'' found it 
suspicious that the three patients from Dr. S.H. arrived at her 
pharmacy at the same time because she ``figured that perhaps the doctor 
scheduled them all the same day'' and the two patients from Jasper and 
Quinton carpooled (one was an amputee without transportation) and the 
third was a local resident, who frequented a cleaner by the pharmacy. 
Tr. 667-69; GX 47, at 9. She stated that the two patients who carpooled 
came to her pharmacy because they were unable to find another pharmacy 
with their medication (oxycodone) in stock. Tr. 650-58; GX 47, at 8-9. 
PIC Davison further testified that she investigated the prescriptions 
by calling the pain management clinic where Dr. S.H. worked to validate 
the prescriptions and checking the PDMP, Tr. 651-53, 658-59, but she 
equivocated on whether or not she documented her investigations, which 
she asserted would have been on prescriptions the DEA had seized and 
not returned, Tr. 662-66. PIC Davison conceded that she generally 
conducted less due diligence on prescriptions from pain clinics like 
the subject prescriptions. Tr. 654.
    Based on the evidence in the record, I find that Respondent filled 
prescriptions from prescriber S.H. that raised red flags and that PIC 
Davison knew or should have known that the prescriptions raised red 
flags. Carpooling explains why two of the patients arrived at the same 
time, but it does not explain the unusual distances they traveled or 
why the third patient arrived at the pharmacy with them. PIC Davison's 
explanation that she was not suspicious of them all arriving together, 
because she assumed the doctor had seen the patients on the same day 
also lacks credibility--Respondent Pharmacy filled the prescriptions 
approximately two weeks after they were prescribed.\30\ I further find 
that, even if these red flags were resolvable, there was no credible 
evidence that Respondent addressed or resolved them before filling the 
prescriptions. I cannot, and do not, place any weight on PIC Davison's 
testimony that she resolved the red flags because she produced no 
contemporaneous documentary evidence to support her claim that she 
attempted to and, in fact, did resolve them before filling the 
prescriptions and because the ALJ found that the testimony was not 
credible. See RD, at 56.
---------------------------------------------------------------------------

    \30\ The three patients' prescriptions were written on July 29 
and 30, 2015. The patients had the prescriptions filled at 
Respondent Pharmacy on August 13, 2015. See GX 15.
---------------------------------------------------------------------------

4. Patient A.C.
    On September 23 and 24, 2015, Respondent filled prescriptions for 
patient A.C. for 30 tablets of carisoprodol 350 mg, identified as a 7-
day supply, and 30 tablets of hydrocodone-acetaminophen 7.5-325mg, 
identified as a 4-day supply. RD, at 5. The Government alleged that 
patient A.C. ``presented prescriptions for a high volume of narcotics 
for a small period of time'' and were ``non-periodic in nature'' and 
``presented prescriptions from two different doctors in the prior 
month.'' ALJX 1, at 4-5. The Government further alleged that 
investigation of these circumstances would have revealed that A.C. 
``had presented numerous prescriptions from different prescribers to 
different pharmacies,'' but that Respondent had filled A.C.'s 
prescriptions without appropriate investigation, documentation, and 
resolution of the circumstances. Id.
    Dr. Alverson testified that A.C.'s prescriptions had several red 
flags. She stated that A.C.'s records were suggestive of doctor and 
pharmacy shopping and that if PIC Davison had reviewed the PDMP data 
before dispensing the prescription of hydrocodone to A.C. on September 
24, 2015, PIC Davison would have seen that A.C. had filled five 
different prescriptions for hydrocodone in the previous month. Tr. 434-
38, GX 16 and 28. Dr. Alverson testified that the red flags for A.C.'s 
prescriptions were so egregious that, in her opinion, an Alabama 
pharmacist acting in accordance with appropriate professional standards 
could not resolve them. Tr. 440.
    PIC Davison argues that the subject prescription was appropriately 
dispensed based on the investigation she conducted. PIC Davison spoke 
in detail regarding information she learned directly from A.C.; 
however, her testimony regarding the rest of her investigation was 
inconsistent. PIC Davison testified that she had called a Dr. S. to 
verify A.C.'s prescriptions, but the prescriptions at issue were 
prescribed by a different doctor, Dr. C. Tr. 670, see GX 16. Then on 
cross examination, PIC Davison implied that she had spoken with Dr. 
C.\31\ Tr. 792. Additionally, during the hearing, PIC Davison 
speculated the Government and

[[Page 53414]]

Dr. Alverson may have improperly attributed PDMP data to patient A.C. 
because the PDMP report used by the Government compiled data from 
patient profiles with the same name and birthdate but with four 
different street addresses in Bessemer, Alabama. Tr. 788-91. Yet, PIC 
Davison also testified that she declined to fill a prescription for 
A.C. in July of 2015 based on the same PDMP data. Tr. 670.
---------------------------------------------------------------------------

    \31\ When asked if she would fill the subject prescription 
today, PIC Davison replied ``I know after talking with Dr. [C.] 
then, yes, I would've filled it.''
---------------------------------------------------------------------------

    Based on the evidence in the record, I find that Respondent filled 
prescriptions for patient A.C. that raised red flags and that PIC 
Davison knew or should have known that the prescriptions raised red 
flags. I further find that, even if these red flags were resolvable--
and there was credible testimony from Dr. Alverson that they were not--
there was no credible evidence that Respondent addressed or resolved 
them before filling the prescriptions. I cannot, and do not, place any 
weight on PIC Davison's testimony that she resolved the red flags, 
because she produced no contemporaneous documentary evidence to support 
her claim that she attempted to and, in fact, did resolve them before 
filling the prescriptions and because her testimony was inconsistent 
and the ALJ found that it was not credible. RD, at 56.
5. Patient R.D.
    On October 11, 2014, Respondent filled a prescription for a 
narcotic for Patient R.D. The Government alleged the patient presented 
this prescription days after filling another prescription for a large 
volume of narcotics and that the prescriber specialized in obstetrics 
and gynecology (an unusual fact since R.D. was a male) and that despite 
these circumstances, Respondent ``filled the prescription without 
appropriate investigation, documentation, and resolution of these 
circumstances.'' ALJX 1, at 5. The Government also presented testimony 
that the prescription was a forgery. See Tr. 142.
    Dr. Alverson testified that it is a red flag that Patient R.D. 
received a month's supply of a narcotic within a week of receiving a 
month's supply of another narcotic and that an Alabama pharmacist would 
be expected to investigate and resolve the red flag before filling the 
second (the October 11) prescription. Tr. at 441. Dr. Alverson further 
testified that a brief investigation would have revealed that the 
``prescribing doctor'' was an obstetric gynecologist--another red flag 
as Patient R.D. is male. Id. at 445. PIC Davison conceded at the 
hearing that she had not conducted any investigation before filling 
Patient R.D.'s October 11, 2104 prescription. Tr. 795-96.
    Based on the evidence in the record, I find that Respondent filled 
a prescription for patient R.D. that raised red flags and that PIC 
Davison knew or should have known that the prescription raised red 
flags. I further find that Respondent did not investigate or resolve 
the red flags--which were unresolvable as the prescription was a 
forgery--before filling the prescription.
    In sum, I find that between October 2014 and September 2015, 
Respondent filled prescriptions that presented red flags that an 
Alabama pharmacist acting in the usual course of her professional 
practice and in fulfillment of her corresponding responsibility should 
have recognized, investigated, documented, and resolved prior to 
filling the prescriptions. I further find that Respondent did not 
conduct proper investigations of these prescriptions before filling 
them and did not document the results of any investigation she did 
conduct as is standard practice for an Alabama pharmacist and required 
by Ala. Admin. Code 680-X-2-.21.

II. Discussion

    The Government alleged that the Respondent Pharmacy's registration 
should be revoked because the Respondent Pharmacy has materially 
falsified its renewal application and has committed acts that would 
render its registration inconsistent with the public interest as 
provided in 21 U.S.C. 823(f). The gravamen of the Government's 
allegations and evidence in this case focuses on allegations that 
Respondent Pharmacy provided false and material responses in the 
renewal application for registration and that it violated federal and 
state laws relating to controlled substances when it improperly filled 
prescriptions and failed to properly maintain certain records.\32\
---------------------------------------------------------------------------

    \32\ In Respondent's Prehearing statement and in the prehearing 
conversation she had with Dr. Alverson, PIC Davison implied that DEA 
may not have treated her fairly based on her race, Tr. 329; Resp 
Prehearing, at 23, but Respondent did not actively pursue this issue 
as a defense during the hearing, Tr. 686-87. Before the hearing, the 
ALJ advised the parties that if the issue was pursued, he would 
consider it within the context of ``unequal treatment'' by the 
Agency and asked Respondent's counsel if he planned to pursue a 
defense of unfair or unequal treatment by the Agency. Tr. 19. 
Respondent Counsel responded that he agreed with the ALJ that the 
legal issue presented would be one of disparate impact but stated 
that he would not know if Respondent would pursue disparate impact 
as a defense until after hearing the testimony at the hearing. Tr. 
20-21. After the hearing, Respondent filed a Posthearing Brief with 
the ALJ that presented Respondent's arguments and defenses against 
the Government's case. Respondent did not allege unequal treatment 
in that brief. Because Respondent did not pursue the defense at 
hearing or in its Posthearing Brief, I consider Respondent to have 
abandoned the defense and will not consider it in my decision.
---------------------------------------------------------------------------

A. Materially False Statement in Renewal Application

    The Government's allegation that Respondent Pharmacy materially 
falsified its renewal application arose with the Respondent Pharmacy's 
application to renew its registration during the pendency of this 
action. In the renewal application, Respondent Pharmacy answered ``No'' 
to the question: ``[h]as the applicant ever surrendered (for cause) or 
had a federal controlled substance registration revoked, suspended, 
restricted, or denied, or is any such action pending?'' GX 26, at 1. 
The Government alleged that Respondent materially falsified its renewal 
application on the basis of its ``No'' response to the above 
question.\33\
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    \33\ This allegation does not appear in the Order to Show Cause 
because it did not arise until after the OSC was issued. The 
Government did, however, clearly include the allegation in its 
Supplemental Prehearing Statement, Respondent did not challenge the 
timeliness of the allegation, see, e.g., Resp Prehearing Statement, 
and the allegation was fully litigated during the hearing, see RD, 
at 25. The ALJ found Respondent received sufficient notice of the 
allegation, and the allegation was properly before him. Id. at 26. I 
concur.
---------------------------------------------------------------------------

    Pursuant to 21 U.S.C. 824(a)(1), a registration ``may be suspended 
or revoked . . . upon a finding that the registrant (1) has materially 
falsified any application filed pursuant to or required by subchapter 
or subchapter II of this chapter . . . .'' There is no question that 
Respondent knew or should have known that it submitted a registration 
renewal application with a false response to the question asking if the 
applicant had an action pending to have a federal controlled substance 
registration revoked. Supra I.A. Respondent, however, argued that its 
false response to that question was not material and therefore cannot 
serve as a ground to revoke its registration. First, Respondent argued 
that DEA had issued the OSC and was obviously aware that there was a 
pending revocation of Respondent's registration. Resp Posthearing, at 
6. Second, Respondent argued that, even if DEA were deceived, ``that 
deception would not have had an effect on the renewal, which in this 
case was automatic.'' Id. I reject Respondent's arguments, as the ALJ 
did, for the reasons that follow. See RD, at 28-29.
    Respondent's submission of a renewal application containing a false 
response to a liability question is material, because such false 
information is ``predictably capable of affecting, i.e., ha[s] a 
natural tendency to affect, the

[[Page 53415]]

official decision.'' Kungys v. United States, 485 U.S. 759, 771 (1988). 
All of the form's liability questions implicate at least one of the 
factors I am required to consider in carrying out my registration-
related responsibilities under 21 U.S.C. 823(f). Respondent's false 
response to liability question number two is material because of this 
question's connection to the second, third, and fourth factors listed 
in section 824(f) and, therefore, my ability to carry out my statutory 
responsibilities. 21 U.S.C. 823(f). Thus, I reject Respondent's 
argument that ``the omission was not material because it had no 
capacity to affect the official decision.'' Resp Post Hearing, at 6.
    I also reject Respondent's argument that ``not only could the 
failure to alert the DEA what the DEA was doing possibly deceive the 
DEA, but even if it could, then that deception would not have had an 
effect on the renewal, which in this case was automatic.'' \34\ Id. 
First, having an ``effect on the renewal'' plays no role in the 
assessment of ``materiality.'' As Respondent acknowledges in its Post 
Hearing Brief, the Supreme Court made this clear decades ago when it 
stated that ``[i]t has never been the test of materiality that the 
misrepresentation or concealment would more likely than not have 
produced an erroneous decision, or even that it would more likely than 
not have triggered an investigation.'' Kungys, 485 U.S. at 771 
[emphases in original]. Second, while some Agency decisions mention 
deception,\35\ they mention it in the context of determining the 
appropriate sanction, not in determining whether a falsity is material. 
I decline Respondent's suggestion that I disregard Supreme Court 
precedent by injecting the notion of deception into my assessment of 
materiality.
---------------------------------------------------------------------------

    \34\ Respondent's argument that DEA's acceptance of its renewal 
application is ``automatic'' is baseless and I reject it. Infra.
    \35\ See e.g., Daniel A. Glick, D.D.S., 80 FR 74,800, 74,808 
(2015) (lack of intent to deceive can be a ``relevant consideration 
[]'').
---------------------------------------------------------------------------

    Respondent additionally argues that an existing registration is 
renewed automatically, thereby precluding any affirmative finding of 
materiality. Respondent misreads 21 CFR 1301.36(i).\36\ Nothing in it 
grants a registrant the automatic renewal of its registration. The 
renewal of Respondent's registration is not ``automatic,'' and I 
disagree with Respondent that 21 CFR 1301.36(i) is relevant to whether 
or not Respondent's false submission is material.
---------------------------------------------------------------------------

    \36\ 21 CFR 1301.36(i) states, in part, that ``[i]n the event 
that an applicant for reregistration (who is doing business under a 
registration previously granted and not revoked or suspended) has 
applied for reregistration at least 45 days before the date on which 
the existing registration is due to expire, and the Administrator 
has issued no order on the application on the date on which the 
existing registration is due to expire, the existing registration of 
the applicant shall automatically be extended and continue in effect 
until the date on which the Administrator so issues his/her order . 
. . .''
---------------------------------------------------------------------------

    For the reasons stated above, I find that Respondent's false 
response on its renewal application is material, which is an 
independent ground for revocation pursuant to section 824(a)(1).

B. Public Interest Factors

    Section 304(a) of the Controlled Substances Act provides that ``[a] 
registration . . . to . . . dispense a controlled substance . . . may 
be suspended or revoked by the Attorney General upon a finding that the 
registrant . . . has committed such acts as would render [its] 
registration under section 823 of this title inconsistent with the 
public interest as determined under such section.'' 21 U.S.C. 824(a). 
In the case of a practitioner, which includes a pharmacy, the CSA 
requires the Agency consider the following factors in determining 
whether Respondent's registration would be inconsistent with the public 
interest:
    (1) The recommendation of the appropriate State licensing board or 
professional disciplinary authority.
    (2) The [registrant's] experience in dispensing, or conducting 
research with respect to controlled substances.
    (3) The [registrant'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.
21 U.S.C. 823(f).
    The DEA considers these public interest factors separately. Ajay S. 
Ahuja, M.D., 84 FR 5479, 5488 (2019); Robert A. Leslie, M.D., 68 FR 
15,227, 15,230 (2003). Each factor is weighed on a case-by-case basis. 
Morall v. Drug Enf't Admin., 412 F.3d 165, 173-74 (D.C. Cir. 2005). Any 
one factor, or combination of factors, may be decisive. David H. 
Gillis, M.D., 58 FR 37,507, 37,508 (1993). Thus, there is no need to 
enter findings on each of the factors. Hoxie v. Drug Enf't Admin., 419 
F.3d 477, 482 (6th Cir. 2005). Furthermore, there is no requirement to 
consider a factor in any given level of detail. Trawick v. Drug Enf't 
Admin., 861 F.2d 72, 76-77 (4th Cir. 1988). The balancing of the public 
interest factors ``is not a contest in which score is kept; the Agency 
is not required to mechanically count up the factors and determine how 
many favor the Government and how many favor the registrant. Rather, it 
is an inquiry which focuses on protecting the public interest . . . .'' 
Jayam Krishna-Iyer, M.D., 74 FR 459, 462 (2009). When deciding whether 
registration is in the public interest, the DEA must consider the 
totality of the circumstances. See generally Joseph Gaudio, M.D., 74 FR 
10,083, 10,094-95 (2009) (basing sanction on all evidence on record).
    In the adjudication of a revocation of a DEA registration, the 
Government has the burden of proving that the requirements of 
revocation are satisfied. 21 CFR 1301.44(e). When the Government has 
met its prima facie case, the burden then shifts to the Respondent to 
show that, given the totality of the facts and circumstances on the 
record, revoking registration would not be appropriate. Med. Shoppe-
Jonesborough, 73 FR 364, 387 (2008).
    While I have considered all of the public interest factors, the 
Government's case invoking the public interest factors of 21 U.S.C. 
824(f) seeks the revocation of the Respondent Pharmacy's registration 
based primarily on conduct most aptly considered under Public Interest 
Factors Two and Four.\37\ The Government also alleged certain ``other 
conduct which threatens the public health and safety,'' which is 
properly considered under Factor Five. I find that the Government's 
evidence with respect to Factors Two and Four satisfies its prima facie 
burden of showing that Respondent's continued registration would be 
``inconsistent with the public interest.'' 21 U.S.C. 823(f). I further 
find that Respondent failed to provide sufficient evidence to rebut the 
Government's prima facie case.

[[Page 53416]]

Specifically, I find that the record contains substantial evidence that 
Respondent's Pharmacist-in-Charge, PIC Davison, violated her 
corresponding responsibility when she dispensed multiple prescriptions. 
I also find there is substantial evidence on the record that Respondent 
violated multiple federal and state recordkeeping requirements.
---------------------------------------------------------------------------

    \37\ There is nothing in the record to suggest that a state 
licensing board made any recommendation regarding the disposition of 
the Respondent Pharmacy's DEA registration (Factor One). However, 
the fact that a state has not acted against a registrant's license 
is not dispositive in this administrative determination as to 
whether continuation of a registration is consistent with the public 
interest. E.g., Holiday CVS LLC dba CVS Pharmacy Nos 219 and 5195, 
77 FR 62,316, 62,340 (2012); Patrick W. Stodola, M.D., 74 FR 20,727, 
20,730 (2009). Likewise, the record contains no evidence that the 
Respondent Pharmacy, its owner, or any pharmacist or key employee of 
pharmacy has been convicted of (or charged with) a crime related to 
controlled substances (Factor Three). However, as Agency cases have 
noted, there are a number of reasons why a person who has engaged in 
criminal misconduct may never have been convicted of an offense 
under this factor. Dewey C. MacKay, M.D., 75 FR 49,956, 49,973 
(2010), pet. for rev. denied, MacKay v. Drug Enf't Admin., 664 F.3d 
808 (10th Cir. 2011). Agency cases have therefore held that ``the 
absence of such a conviction is of considerably less consequence in 
the public interest inquiry'' and is therefore not dispositive. Id.
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1. Factors Two and Four--The Respondent's Experience in Dispensing 
Controlled Substances and Compliance With Applicable Laws Related to 
Controlled Substances
    Evidence is considered under Public Interest Factors Two and Four 
when it reflects a registrant's compliance (or non-compliance) with 
laws related to controlled substances and registrant's experience 
dispensing controlled substances. Established violations of the 
Controlled Substances Act, DEA regulations, or other laws regulating 
controlled substances at the state or local level are cognizable when 
considering if a registration is consistent with the public interest. 
As DEA has held in the past, a registrant's ``ignorance of the law is 
no excuse'' for actions that are inconsistent with responsibilities 
attendant upon a registration. Daniel A. Glick, D.D.S., 80 FR 74,800, 
74,809 (2015) (quoting Sigrid Sanchez, M.D., 78 FR 39,331, 39,336 
(2013)). Under Agency precedent, ``[a]ll registrants are charged with 
knowledge of the CSA, its implementing regulations, as well as 
applicable state laws and rules.'' Id. at 74,809 (internal citations 
omitted). Agency precedent has also consistently held that the 
registration of a pharmacy may be revoked as the result of the unlawful 
activity of the pharmacy's owners, majority shareholders, officers, 
managing pharmacist, or other key employee. EZRX, LLC, 69 FR 63,178, 
63,181 (2004); Plaza Pharmacy, 53 FR 36,910, 36,911 (1988).\38\
---------------------------------------------------------------------------

    \38\ The Order to Show Cause alleged that ``Respondent'' 
violated its corresponding responsibility. It is undisputed that 
Respondent is owned and operated by Santonia Davison, who is also 
Respondent's pharmacist-in-charge and Respondent's only pharmacist. 
Thus, for purposes of finding and attributing liability in this 
case, I find that the actions and inactions of Respondent's Owner 
and PIC were the actions and inactions of Respondent.
---------------------------------------------------------------------------

    In this case, the Government alleged and presented evidence that 
the Respondent Pharmacy's pharmacist, in violation of 21 CFR 
1306.04(a), failed to exercise her corresponding responsibility to 
assess the legitimacy of numerous controlled substance prescriptions 
she filled. ALJX 1, at 2-5. The Government also alleged that, in 
violation of 21 CFR 1306.06, the Respondent Pharmacy's pharmacist 
failed to dispense those same prescriptions for controlled substances 
within the lawful bounds of the pharmacy profession. Id. Additionally, 
the Government alleged and presented evidence that the Respondent 
Pharmacy failed to maintain an initial inventory required under federal 
law pursuant to 21 CFR 1304.11, or an initial inventory and an annual 
inventory required under Alabama law pursuant to Ala. Admin. Code 680-
X-3-.08. ALJX 1, at 5 and 6. The Government also alleged and presented 
evidence that the Respondent Pharmacy failed to notate whether 
individual controlled substances that it ordered were actually 
received, and if so, on what date they were received, in the CSOS, on 
DEA Form 222s, and on its invoices. Id. at 6. Perhaps as a result of 
those alleged recordkeeping violations, the Government also alleged 
that an audit revealed ``significant discrepancies'' in the amounts of 
certain controlled substances at the pharmacy compared with the amounts 
the Respondent Pharmacy's records indicated should have been present. 
Id. Finally, the Government alleged and presented evidence that the 
Respondent Pharmacy inaccurately reported certain information to the 
Alabama PDMP, undermining the purpose of that database. Id. at 7. These 
allegations and the evidence of record are addressed below.
a. Unlawful Dispensing Allegations
    According to the CSA's implementing regulations, a lawful 
controlled substance order or prescription is one that is ``issued for 
a legitimate medical purpose by an individual practitioner acting in 
the usual course of his professional practice.'' 21 CFR 1306.04(a). 
While the ``responsibility for the proper prescribing and dispensing of 
controlled substances is upon the prescribing practitioner, . . . a 
corresponding responsibility rests with the pharmacist who fills the 
prescription.'' Id. The regulations establish the parameters of the 
pharmacy's corresponding responsibility.

    An order purporting to be a prescription issued not in the usual 
course of professional treatment . . . is not a prescription within 
the meaning and intent of . . . 21 U.S.C. 829 . . . and the person 
knowingly filling such a purported prescription, as well as the 
person issuing it, shall be subject to the penalties provided for 
violations of the provisions of law relating to controlled 
substances.

    Id. ``The language in 21 CFR 1306.04 and caselaw could not be more 
explicit. A pharmacist has his own responsibility to ensure that 
controlled substances are not dispensed for non-medical reasons.'' 
Ralph J. Bertolino, d/b/a Ralph J. Bertolino Pharmacy, 55 FR 4729, 4730 
(1990) (citing United States v. Hayes, 595 F.2d 258 (5th Cir. 1979), 
cert. denied, 444 U.S. 866 (1979); United States v. Henry, 727 F.2d 
1373 (5th Cir. 1984) (reversed on other grounds)). As the Supreme Court 
explained in the context of the CSA's requirement that schedule II 
controlled substances may be dispensed only by written prescription, 
``the prescription requirement . . . ensures patients use controlled 
substances under the supervision of a doctor so as to prevent addiction 
and recreational abuse . . . [and] also bars doctors from peddling to 
patients who crave the drugs for those prohibited uses.'' Gonzales v. 
Oregon, 546 U.S. 243, 274 (2006).
    To prove a pharmacist violated his corresponding responsibility, 
the Government must show that the pharmacist acted with the requisite 
degree of scienter. See 21 CFR 1306.04(a) (``[T]he person knowingly 
filling [a prescription issued not in the usual course of professional 
treatment] . . . shall be subject to the penalties provided for 
violations of the provisions of law relating to controlled 
substances.'') (emphasis added). DEA has also consistently interpreted 
the corresponding responsibility regulation such that ``[w]hen 
prescriptions are clearly not issued for legitimate medical purposes, a 
pharmacist may not intentionally close his eyes and thereby avoid 
[actual] knowledge of the real purpose of the prescription.'' 
Bertolino, 55 FR at 4730 (citations omitted); see, also JM Pharmacy 
Group, Inc. d/b/a Pharmacia Nueva and Best Pharmacy Corp., 80 FR 
28,667, 28,670-72 (2015) (applying the standard of willful blindness in 
assessing whether a pharmacist acted with the requisite scienter). 
Pursuant to their corresponding responsibility, pharmacists must 
exercise ``common sense and professional judgment'' when filling a 
prescription issued by a physician. Bertolino, 55 FR at 4730. When a 
pharmacist's suspicions are aroused by a red flag, the pharmacist must 
question the prescription and, if unable to resolve the red flag, 
refuse to fill the prescription. Id.; Medicine Shoppe-Jonesborough, 300 
F. App'x 409, 412 (6th Cir. 2008) (``When pharmacists' suspicions are 
aroused as reasonable professionals, they must at least verify the 
prescription's propriety, and if not satisfied by the answer they must 
refuse to dispense.'').

[[Page 53417]]

    Here, the Government does not claim that Respondent dispensed the 
subject prescriptions having actual knowledge that the prescriptions 
lacked a legitimate medical purpose. Rather, the Government argues that 
Respondent violated the corresponding responsibility rule when she 
dispensed controlled substance prescriptions while ``repeatedly 
ignor[ing] obvious and apparent signs of abuse and diversion--signs 
that a professional pharmacist, operating in the bounds of the 
profession with eyes open to such indicia, would detect and resolve.'' 
Govt Posthearing, at 37.
    As I found above, Respondent dispensed prescriptions for controlled 
substances without resolving red flags presented by the prescriptions, 
including the red flags of drug cocktails, multiple customers filling 
prescriptions from the same prescriber for the same drugs (``pattern 
prescribing''), customers with the same last name and street address 
presenting the same prescriptions within a short period of time, 
traveling unusual distances, doctor shopping, pharmacy shopping, 
therapeutic duplication, and unusual increases in drug quantities. 
Prior Agency decisions have found that prescriptions with the same red 
flags at issue here were so suspicious as to support a finding that the 
pharmacists who filled them violated the Agency's corresponding 
responsibility rule due to actual knowledge of, or willful blindness 
to, the prescriptions' illegitimacy. See, e.g., Zion Clinic Pharmacy, 
83 FR at 10,898 (long distances; pattern prescribing; customers with 
the same street address presenting the same prescriptions on the same 
day; drug cocktails; cash payments; early refills); Hills Pharmacy, 81 
FR 49,816, 49,836-39 (2016) (multiple customers filling prescriptions 
written by the same prescriber for the same drugs in the same 
quantities; customers with the same last name and street address 
presenting similar prescriptions on the same day; two short-acting 
opiates prescribed together; long distances; drug cocktails); The 
Medicine Shoppe, 79 FR 59,504, 59,507, 59,512-14 (2014) (unusually 
large quantity of a controlled substance; pattern prescribing; drug 
cocktails); Holiday CVS, 77 FR at 62,317-22 (long distances; multiple 
customers filling prescriptions written by the same prescriber for the 
same drugs in the same quantities; customers with the same last name 
and street address presenting virtually the same prescriptions within a 
short time span); East Main Street Pharmacy, 75 FR 66,149, 66,163-65 
(2010) (long distances; lack of individualized therapy or dosing; drug 
cocktails; early fills/refills; other pharmacies' refusals to fill 
prescriptions). The Government also presented credible testimony that 
PIC Davison knew, or should have known, there were red flags on the 
prescriptions at the time they were dispensed. Alabama law requires 
pharmacists to review all new prescriptions, and refill prescriptions 
where appropriate, for, among other things, therapeutic duplication, 
drug-disease contraindication, incorrect dosage/duration, and clinical 
abuse/misuse. Ala Admin. Code 680-X-2-.21. Dr. Alverson testified that 
an Alabama pharmacist is trained to and should have recognized the red 
flags on the subject prescriptions, which included red flags explicitly 
named in Alabama law, and that an Alabama pharmacist exercising her 
corresponding responsibility and acting in the usual course of 
professional practice will not dispense controlled substances without 
investigating, documenting the investigation, and resolving any red 
flags. Furthermore, PIC Davison's comments to Dr. Alverson that the 
subject patients were receiving the same controlled substances from 
another pharmacy before they came to Respondent Pharmacy and 
``[w]hatever problems they had when they got to [Respondent Pharmacy], 
they had those problems before they got to [Respondent Pharmacy]'' 
reflects an abdication of PIC Davison's corresponding responsibility.
    Accordingly, I find the Government has proven by substantial 
evidence that Respondent filled prescriptions for controlled substances 
that it knew were not prescribed for legitimate medical purposes, or 
was willfully blind to such, in violation of its corresponding 
responsibility under 21 CFR 1306.04(a) and outside the usual course of 
its professional practice in violation of 21 CFR 1306.06.
    In its Posthearing Brief, Respondent contended that the evidence 
produced during the hearing ``demonstrated that the prescriptions at 
issue were neither per-se unreasonable or issued without an appropriate 
investigation'' \39\ and that Respondent, therefore, did not violate 
its corresponding responsibility. Resp Posthearing, at 1. I disagree. 
First, as discussed supra, PIC Davison's testimony regarding the extent 
of her investigations on the subject prescriptions lacked credibility 
and was unsupported by any documentation. Second, it was Dr. Alverson's 
expert testimony that some of the subject prescriptions--those with 
combinations of oxycodone, hydrocodone, and alprazolam, all prescribed 
in high doses--were sufficiently dangerous that they ``on their face 
were invalid.'' Tr. 487. Dr. Alverson also testified that there were 
red flags on patient A.C.'s prescriptions that, in her expert opinion, 
were unresolvable and were, in fact, so egregious that if presented 
with the prescription, she not only would have declined to fill it, she 
would have notified the police. Id. at 439-40. PIC Davison's decisions 
to dispense these prescriptions despite the unresolvable red flags 
indicate that she either did not conduct the thorough investigation she 
claims to have conducted or was willfully blind to the results of her 
own investigation. It is also uncontroverted that Respondent conducted 
no investigation before filling forged prescriptions for patient R.D.
---------------------------------------------------------------------------

    \39\ In its Posthearing Brief, Respondent seemed to agree with 
the Government that the subject prescriptions had red flags, but it 
is difficult to make a blanket statement on Respondent's 
acknowledgement of the red flags identified by Dr. Alverson because 
PIC Davison's testimony at the hearing was equivocal. For example, 
she described two patients from the same household presenting 
substantially similar prescriptions from the same prescriber as a 
circumstance that ``would raise a flag'' but then said that she did 
not find the circumstances suspicious because it was common for 
family members to see the same doctor. Tr. 646-47. In its 
Posthearing Brief, however, Respondent did not contest any of the 
red flags identified by Dr. Alverson. Instead, Respondent only 
argued that PIC Davison had properly investigated all subject 
prescriptions by calling the issuing physicians to verify the 
validity and medical necessity of the prescription.
---------------------------------------------------------------------------

    Finally, Respondent has argued that the Government's case must fail 
because the Government did not produce any of the subject physicians, 
or physicians' representatives, to rebut PIC Davison's testimony that 
she had contacted the prescribing physicians to verify the subject 
prescriptions were legitimate and medically necessary given the 
conditions of the patients. Resp Posthearing, at 2. Respondent did not 
elaborate on its argument or cite any legal precedent for it, and it is 
contrary to Agency decisions. See, e.g., Zion Clinic Pharmacy, 83 FR at 
10,899. Accordingly, I reject it.\40\
---------------------------------------------------------------------------

    \40\ Furthermore, as discussed supra at I.E., I do not place any 
weight on PIC Davison's testimony that she adequately investigated 
and resolved the red flags on the subject prescriptions because she 
produced no contemporaneous documentary evidence to support her 
claim and because the ALJ found, and I agree, that the testimony was 
not credible.
---------------------------------------------------------------------------

b. Recordkeeping Allegations
    In addition to its mandate that controlled substances be dispensed 
properly, the CSA also recognizes that controlled substances are 
fungible and that a truly closed system requires that

[[Page 53418]]

certain records and inventories be kept by all registrants who either 
generate or take custody of controlled substances in any phase of the 
distribution chain until they reach the ultimate user. Satinder Dang, 
M.D., 76 FR 51,424, 51,429 (2011) (``Recordkeeping is one of the 
central features of the CSA's closed system of distribution.'') 
(internal citations omitted); Paul H. Volkman, 73 FR 30,630, 30,644 
(2008), pet. for rev. denied 567 F.3d 215, 224 (6th Cir. 2009) 
(``Recordkeeping is one of the CSA's central features; a registrant's 
accurate and diligent adherence to this obligation is absolutely 
essential to protect against the diversion of controlled 
substances.'').
    The OSC alleged that Respondent violated multiple federal 
regulations and Alabama state laws related to the maintenance of 
records. The CSA requires registrants like Respondent to ``maintain, on 
a current basis, a complete and accurate record of each [controlled] 
substance . . . received, sold, delivered, or otherwise disposed of,'' 
21 U.S.C. 827(a), in accordance with and with such relevant information 
as required by the CSA implementing regulations, 21 U.S.C. 827(b). The 
State of Alabama also imposes separate recordkeeping requirements on 
pharmacies.
i. Inventories
    Registrant pharmacies are required to make an initial inventory of 
controlled substances ``on hand'' on the date they first engage in 
dispensing of controlled substances. 21 CFR 1304.11(b). ``In the event 
a person commences business with no controlled substances on hand, he/
she shall record this fact as the initial inventory.'' Id. The initial 
inventory must be available for at least two years from the date of the 
inventory for inspection and copying by the DEA. 21 CFR 1304.04(a).
    DI Two requested the Respondent Pharmacy's initial inventory during 
the May 20, 2015 administrative inspection. PIC Davison was unable to 
produce the initial inventory and conceded at the hearing that she did 
not know she was supposed to have an initial inventory. Supra I.B.2. 
After the July 6, 2015 meeting with the DEA, PIC Davison emailed DI One 
and representatives of the Alabama Board of Pharmacy a computer-
generated record, entitled ``Narcotic Sales Report,'' which included a 
list of the schedule III through V controlled substances procured by 
Respondent Pharmacy from Cardinal Health, the pharmacy's sole 
pharmaceutical distributer, from May 1, 2014 through May 31, 2014. GX 
7, at 58-59. PIC Davison wrote ``Initial Inventory'' at the top of the 
report before faxing it.
    PIC Davison's post hoc attempts to create an initial inventory do 
not meet the requirements of 21 CFR 1304.11(b). Even assuming the 
``Narcotic Sales Report'' record was in the pharmacy during the May 20, 
2015 inspection as PIC Davison claims (a claim which is refuted by DI 
Two whose testimony the ALJ found credible), there is no evidence that 
the report was created when the Respondent Pharmacy commenced 
dispensing controlled substances, and PIC Davison testified that she 
did not mark the report as an ``initial inventory'' until after the 
July 6, 2015 meeting with the DEA. The report also does not meet the 
requirements for an initial inventory because it does not have a 
specific date or a notation of whether it was taken on the open or 
close of business on that date. I find, therefore, that there is 
substantial evidence that Respondent Pharmacy violated 21 CFR 
1304.11(b) by failing to create and maintain a record of an initial 
inventory.
    Alabama state law, like under federal law, also required Respondent 
to conduct an inventory on the ``date it first engages in dispensing of 
controlled substances.'' Ala. Admin. Code 680-x-3-.08(3). After the 
initial inventory, Respondent was required to conduct an annual 
inventory of controlled substances on or around January 15 of each 
calendar year. Ala Admin. Code 680-X-3-.08(1). The inventories must be 
signed and dated and indicate whether they were taken as of the close 
or opening of business. Ala. Admin. Code 680-x-3-.08(4).
    Respondent did not produce either the initial or the January 15 
inventory required by state law at the May 20, 2015 inspection, supra 
I.B.2, and PIC Davison conceded during the hearing that she did not 
conduct an inventory on or about January 15, 2015, as required by state 
law, Tr. 714. I therefore find that there is substantial evidence that 
Respondent did not conduct the required inventories in violation of 
680-x-3-.08 of the Alabama Administrative Code.
ii. Allegations Respondent Violated Regulations Related to Schedule II 
Orders
    The Government alleged that Respondent violated DEA recordkeeping 
regulations for ordering schedule II controlled substances in both its 
paper and electronic ordering systems. ALJX 1, at 6. Specifically, the 
Government alleged that on sixteen electronic records of controlled 
substances ordered by Respondent through the CSOS between March 24, 
2015 and May 19, 2015, Respondent did not indicate that the orders were 
received and that on fifteen records of controlled substances ordered 
by Respondent on DEA Form 222s from November 13, 2014 to March 10, 
2015, Respondent did not notate whether the orders were received. Id. 
(citing 21 CFR 1305.13(e) and 1305.22(g)).
    As support for the allegation that Respondent did not properly 
maintain DEA Form 222s, the Government submitted copies of 15 
``purchaser's Copy 3'' of order forms Respondent submitted to its 
distributer. GX 3. Under DEA's regulations, ``[t]he purchaser must 
record on Copy 3 of the DEA Form 222 the number of commercial or bulk 
containers furnished on each item and the dates on which the containers 
are received by the purchaser.'' 21 CFR 1305.13(e). PIC Davison 
testified that she received the fifteen orders, supra I.B.2., but the 
DEA Form 222s for the orders do not have a record of the date received 
or the number of items received, GX 3. Respondent thus violated 21 CFR 
1305.13(e).
    As support for the allegation that Respondent did not properly 
maintain records or receipt of orders made electronically in the CSOS, 
the Government submitted print-outs of Respondent's CSOS orders from 
March 13, 2015 to May 19, 2015. GX 2. Sixteen of the twenty orders are 
not recorded as ``Received.'' Id. Under DEA regulation 21 CFR 
1305.22(g), ``[w]hen a purchaser receives a shipment [of controlled 
substances from an electronic order], the purchaser must create a 
record of the quantity of each item received and the date received'' 
and ``the record must be electronically linked to the original order 
and archived.'' PIC Davison testified that Respondent Pharmacy received 
the sixteen orders not recorded as ``Received,'' supra I.B.2, but the 
CSOS does not have a record of the date received or the number of items 
received, GX 3. Respondent thus violated 21 CFR 1305.22(g).
iii. Allegation Respondent Violated Schedule III-V Orders Recordkeeping 
Requirements
    Under 21 CFR 1304.22(a)(2)(iv) and (c), Respondent Pharmacy was 
required to maintain a record of each order of controlled substances 
that included the date of receipt, the quantity acquired, and the name, 
address, and registration number of the person from whom the substances 
were acquired. The Government alleged that Respondent violated this 
requirement by failing to record the date and amount of controlled 
substances ``actually

[[Page 53419]]

received.'' ALJX 1, at 6 (citing 21 CFR 1304.21(d)). To support this 
allegation, the Government submitted 64 invoices for orders of schedule 
III-V controlled substances from Respondent Pharmacy.\41\ GX 4. The 
invoices all listed the name, address and registration number of the 
person from whom the substances were acquired and the quantity of 
substances and date shipped. On some of the receipt invoices, 
Respondent had circled the quantity shipped, which DI Two inferred 
could indicate the amount received was correct, but on other receipt 
invoices, there were no circled quantities. Tr. 50-51; GX 4. PIC 
Davison did sign the invoices, which she testified she did to document 
receipt of the order and confirm that the quantity and date listed on 
the invoice were correct. Tr. 578; GX 4.
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    \41\ The Government submitted copies of 69 invoices but conceded 
at the hearing and in the Government's Posthearing Brief that only 
64 of the invoices contained orders for controlled substances. Govt 
Posthearing, at 3.
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    I find that PIC Davison's signature on the invoices was 
insufficient to meet the record requirements of 21 CFR 
1304.22(a)(2)(iv) and that, therefore, Respondent violated the 
regulation. The regulation requires registrants to record the date of 
receipt and quantity acquired. The invoices from Respondent Pharmacy do 
contain the date and quantity shipped but they do not list the date 
received, and the regulation and the Pharmacy Manual, which was 
introduced at the hearing and which PIC Davison testified she used to 
develop her policies and procedures, clearly state that the registrant 
must ``record[] the date the drugs were received and confirm that the 
order is accurate.'' GX 50. While the regulation does not specify the 
manner in which the registrant must make the notations in the record, 
Respondent Pharmacy failed to meet this requirement because it did not 
record the date of receipt on the invoices in any manner and can only 
argue that it confirmed the accuracy of the order on the invoices where 
the quantities were circled.
iv. Audit Discrepancies
    The Agency has also considered a pharmacy registrant's inability to 
account for controlled substances under Factor Four. Ideal Pharmacy 
Care, Inc., 76 FR 51,415, 51,416 (2011). Under the CSA, every 
registrant ``distributing, or dispensing a controlled substance or 
substances shall maintain, on a current basis, a complete and accurate 
record of each such substance . . . received, sold, delivered, or 
otherwise disposed of by [it].'' 21 U.S.C. 827(a)(3). In evaluating 
shortages under Factor Four, the Agency has held that, ``[w]hether the 
shortages are attributable to outright diversion by either pharmacy or 
store employees, theft, or the failure to maintain accurate records, 
does not matter.'' Ideal Pharmacy Care, 76 FR at 51,416. As the Agency 
has explained, the ``inability to account for [a] significant number of 
dosage units creates a grave risk of diversion.'' Fred Samimi, 79 FR 
18,698, 18,712 (2014). The Agency has also made it clear that it is not 
only concerned with shortages, but that overages are equally indicative 
that a pharmacy registrant has ``failed to maintain complete and 
accurate records as required by the CSA.'' Superior Pharmacy I & 
Superior Pharmacy II, 81 FR 31,310, 31,341 (2016); see also Hills 
Pharmacy, 81 FR at 49,843-45 (considering allegations of overages and 
shortages).
    The audit of six oft-diverted controlled substances at the 
Respondent Pharmacy revealed dramatic discrepancies with both shortages 
and overages of drugs. The Respondent Pharmacy conceded most of the 
discrepancies, but explained that they resulted from her unfamiliarity 
with her drug supplier's computer software and the wrong inventory list 
being mistakenly downloaded at the time of the audit. This explanation 
provides no defense. The Respondent Pharmacy is obliged to ``maintain, 
on a current basis, a complete and accurate record of each controlled 
substance,'' 21 CFR 1304.21(a), and to make its records readily 
available for review by DEA, see 21 CFR 1304.04(a). Additionally, even 
Respondent's own ``self-audit,'' which PIC Davison testified she made 
using an inventory report she did not produce during the DEA audit, 
contained discrepancies for four of the six audited controlled 
substances.
    I find, therefore, there is substantial evidence to support the 
allegation that Respondent Pharmacy failed to keep a current and 
accurate record of controlled substances, pursuant to 21 CFR 
1304.21(a).
v. Twenty-One Day Absence of PDMP Inputs
    Under Alabama state law, a licensed pharmacy is required to report 
each dispensation of a controlled substance to the Alabama Prescription 
Drug Monitoring Program. Ala. Code Sec.  20-2-213; Tr. 507-08. Dr. 
Alverson testified that from November 10, 2014, until December 1, 2014, 
the Respondent Pharmacy made no reports of dispensing controlled 
substances to the PDMP, despite the presence of original prescriptions 
evidencing the filling of controlled substances during that period. Tr. 
393-95. See Tr. 174; GX 10, at 36; GX 12; GX 22, at 23.
    PIC Davison explained that she ``guessed'' this lapse was due to a 
software glitch in Respondent Pharmacy's computer system. Tr. 754. This 
provides no defense for Respondent Pharmacy's failure to report for 
three weeks and its failure to make any corrective measures until 
prompted to do so by the Alabama Board of Pharmacy.\42\ Respondent 
Pharmacy has a legal responsibility to report each controlled substance 
dispensation. In his Recommended Decision, the ALJ noted that the long 
lapse begs the questions: ``why did the lapse go on for so long; why 
did the Respondent Pharmacy not quickly correct the lapse? It suggests 
the Respondent Pharmacy was not checking the PDMP frequently.'' RD, at 
56.
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    \42\ It is not clear from PIC Davison's testimony when or how 
she learned of the three week gap in reporting, but her testimony 
strongly implies she did not know about it until she was alerted by 
the Alabama Board of Pharmacy. ``Q [from DEA Attorney Hill]: `When 
were you alerted to the fact that you had stopped reporting any 
controlled substances to PDMP?' A [from PIC Davison]: `I cannot tell 
you at this point. I've had numerous run-ins with the Board of 
Pharmacy, you guys from several cases. I can't actively tell you 
that particular date, but when we did learn about it, we submitted 
the file.''' Tr. 755.
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    Accordingly, I find that Respondent Pharmacy failed to submit 
records to the PDMP in violation of Alabama law.
2. Factor Five
    Under Factor Five, the Administrator is authorized to consider 
``other conduct which may threaten the public health and safety.'' 21 
U.S.C. 823(f)(5). This factor encompasses ``conduct which creates a 
probable or possible threat (and not only an actual [threat]) to public 
health and safety.'' Jacobo Dreszer, M.D., 76 FR 19,386, 19,401 n.2 
(2011). The Government argues that Respondent Pharmacy's inaccurate 
reporting to the Alabama Prescription Drug Monitoring Program and the 
confusion that the inaccurate reporting caused threatened public safety 
and weigh in favor of revocation under Factor Five.
    The record reveals that the Respondent Pharmacy did submit 
incorrect information to the Alabama PDMP on several occasions. DI One 
had received a call from a local doctor, Dr. F., complaining that the 
Respondent Pharmacy had filled a prescription and attributed it to Dr. 
F. on the PDMP, which this doctor had not prescribed. Tr. 157-60; GX 8. 
DI One retrieved the original prescription from the Respondent 
Pharmacy, which identified

[[Page 53420]]

a different doctor as prescriber, yet the pharmacy label incorrectly 
identified Dr. F. as the prescriber. Tr. 162-68. DI One also found 
instances where duplicate prescriptions were entered into the PDMP by 
the Respondent Pharmacy and where Respondent Pharmacy had input 
prescriptions under a prescriber DEA number with insufficient digits. 
Id. at 172-73; see GX 10, at 36 and 40. But there is also evidence in 
the record that the PDMP is subject to error, delayed reporting, and 
correction. Dr. Alverson testified that a pharmacy cannot correct a 
PDMP entry itself and must contact the PDMP staff with the correction. 
Tr. 412, 506. She further testified that the pharmacy is under no 
obligation to ensure the correction was made, Tr. 507, and DI One 
testified that she did not, as part of her investigation, contact the 
PDMP to determine if Respondent Pharmacy had submitted corrected 
information for any of the incorrect entries, Tr. 272.
    The Government concedes that stray errors in PDMP reports would not 
render a registration inconsistent with the public interest and argues 
only that such errors should be considered to ``threaten the public 
health safety'' under Factor Five when they are ``sufficiently 
persistent and widespread that they are credibly said to impede 
regulatory investigations.'' Govt Posthearing, at 47 n.23. The 
Government has failed to meet the standard it set for itself. While I 
agree with the Administrative Law Judge's assessment that errors within 
the PDMP compromise the important role the program plays in the state 
in preventing the abuse and diversion of controlled substances, RD, at 
56, the handful of PDMP submission errors by Respondent Pharmacy that 
are supported by evidence on the record were not so widespread or 
egregious in this case that they threatened the public health and 
safety.
    The Government has demonstrated that Respondent's omissions to the 
PDMP were sufficiently persistent and widespread that they could pose a 
threat to public health and safety, but in this case, those failures 
were a violation of state law and were considered under Factor Four. 
Because Factor Five only implicates ``such other conduct,'' it 
necessarily follows that conduct considered in Factors One through Four 
may not be considered under Factor Five. Holiday CVS, 77 FR at 62,345. 
Accordingly, Factor Five does not weigh for or against revocation.
3. Summary of the Public Interest Factors
    As found above, Respondent Pharmacy filled controlled substance 
prescriptions for nearly a dozen patients in violation of its 
corresponding responsibility and outside the usual course of 
professional practice. 21 CFR 1306.04, 1306.06. It also violated 
numerous federal and state record keeping regulations related to 
controlled substances. Thus, I conclude that Respondent has engaged in 
misconduct which supports the revocation of its registration. I 
therefore hold that the Government has established a prima facie case 
that Respondent's continued registration ``would be inconsistent with 
the public interest.'' 21 U.S.C. 823(f).

III. Sanction

    Where, as here, the Government has met its prima facie burden of 
showing that Respondent's continued registration is inconsistent with 
the public interest due to its violations pertaining to controlled 
substance dispensing and recordkeeping, the burden shifts to Respondent 
to show why it can be entrusted with the responsibility carried by its 
registration. Garret Howard Smith, M.D., 83 FR 18,882, 18,910 (2018) 
(citing Samuel S. Jackson, 72 FR 23848, 23853 (2007)). DEA cases have 
repeatedly found that when a registrant has committed acts inconsistent 
with the public interest, ``the Respondent is required not only to 
accept responsibility for [the established] misconduct, but also to 
demonstrate what corrective measures [have been] undertaken to prevent 
the reoccurrence of similar acts.'' Holiday CVS, 77 FR at 62,339 
(internal quotations omitted). See, also, Hoxie v. DEA, 419 F.3d 477, 
483 (6th Cir. 2005); Ronald Lynch, M.D., 75 FR 78,745, 78,749, 78,754 
(2010) (holding that respondent's attempts to minimize misconduct held 
to undermine acceptance of responsibility); Medicine Shoppe-
Jonesborough, 73 FR 364, 387 (2008) (noting that the respondent did not 
acknowledge recordkeeping problems, let alone more serious violations 
of federal law, and concluding that revocation was warranted). The 
issue of trust is necessarily a fact-dependent determination based on 
the circumstances presented by the individual respondent; therefore, 
the Agency looks at factors, such as the acceptance of responsibility 
and the credibility of that acceptance as it relates to the probability 
of repeat violations. Jeffrey Stein, M.D., 84 FR 46,968, 46,972 (2019). 
A registrant's candor during the investigation and hearing is an 
important factor in determining acceptance of responsibility and the 
appropriate sanction, Garret Howard Smith, M.D., 83 FR at 18,910 
(collecting cases); as is whether the registrant's acceptance of 
responsibility is unequivocal, Lon F. Alexander, M.D., 82 FR 49,704, 
49,728 (2017) (collecting cases).\43\
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    \43\ Here, the Respondent Pharmacy testified that there were 
five instances, out of the 69 alleged invoice violations for orders 
of schedule III-V controlled substances, in which the Government had 
mistakenly included non-controlled substances. The Government 
credibly explained the cause of the charging error and amended the 
charges accordingly. The ALJ did not consider this legal challenge 
by the Respondent as compromising her potential acceptance of 
responsibility, RD, at 58, and neither will I.
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    In determining whether and to what extent a sanction is 
appropriate, consideration must be given to both the egregiousness of 
the offense established by the Government's evidence and the Agency's 
interest in both specific and general deterrence. Wesley Pope, 82 FR 
14,944, 14,985 (2017) (citing Joseph Gaudio, 74 FR 10,083, 10,095 
(2009)); David A. Ruben, M.D., 78 FR 38,363, 38,364 (2013). Cf. 
McCarthy v. SEC, 406 F.3d 179, 188-89 (2d Cir. 2005) (upholding SEC's 
express adoption of ``deterrence, both specific and general as a 
component in analyzing the remedial efficacy of sanctions.''). Normal 
hardships to the practitioner and even to the surrounding community 
that are attendant upon the lack of registration are not relevant 
considerations. Linda Sue Cheek, M.D., 76 FR 66,972, 66,973 (2011).
    Here, the ALJ recommended that I find that Respondent did not 
``meet[] the evidence with an acceptance of responsibility.'' RD, at 
57. PIC Davison testified during the hearing that she took 
responsibility for many of the established violations but her 
acceptance was equivocal, did not cover the full scope of her 
violations, and lacked credibility. PIC Davison acknowledged many of 
her recordkeeping failures but did not acknowledge the impropriety of a 
single dispensing of a controlled substance at issue in this case.\44\ 
Dr. Alverson's fact testimony, which the ALJ found credible, also 
belied PIC Davison's acceptance of responsibility at the hearing. Just 
a month before the hearing, PIC Davison was eschewing her

[[Page 53421]]

professional responsibility telling Dr. Alverson that whatever problems 
her patients had with controlled substances, they already had those 
problems when they arrived at her pharmacy.
---------------------------------------------------------------------------

    \44\ The closest PIC Davison came to acknowledging that she 
improperly filled a prescription was to say that if presented with 
female M.A.'s prescription today she would perhaps not fill it based 
on 2016 guidelines on the dangers of opioid and benzodiazepine 
combinations, but Dr. Alverson testified that the danger was widely 
known in the pharmacy community when PIC Davison filled female 
M.A.'s prescription. See Tr. 420, 773-75.
---------------------------------------------------------------------------

    PIC Davison also failed to recognize the real harm that could 
result to her patients and the public from her violations and minimized 
the severity of her misconduct. She seemed more concerned with 
preventing another DEA investigation than preventing diversion 
repeatedly testifying that she was sorry her violations ``caused all 
this uproar.'' Tr. 691-92.
    Additionally, the ALJ found that PIC Davison was not fully candid 
during the investigation and hearing, which tends to rebut any 
acceptance of responsibility. The ALJ stated that ``[i]n testifying as 
to factual matters regarding the initial inventory, the timing and 
extent of her purported investigations, and documentation of her 
investigations, PIC Davison's testimony was marked with a level of 
equivocation, implausibility, and inconsistently that profoundly 
undermined her efforts to diminish her culpability.'' RD, at 58. For 
example, Respondent conceded that it failed to properly document PIC 
Davison's due diligence investigations as to some of the subject 
patients, while suggesting to have properly documented her 
investigation as to other patients; however, the ALJ specifically found 
that PIC Davison's testimony regarding her documentation of 
investigations was not always credible. Id. Finally, PIC Davison's 
false statements on her registration renewal application, which were 
made during the pendency of the instant matter, undermine any claims of 
contrition and her argument that she can be trusted with the 
responsibilities of a registration.
    In Respondent's favor, PIC Davison testified that she has 
undertaken corrective measures to prevent the reoccurrence of 
violations of her regulatory and professional responsibilities. She has 
instituted new policies to remedy Respondent Pharmacy's numerous 
recordkeeping violations including contemporaneous electronic notations 
of communications with physicians, up to date ordering processes for 
all controlled substances, and manual input of PDMP information to 
avoid errors. The ALJ also found that PIC Davison's in-hearing 
``impromptu evaluation of patient cases demonstrated that she was fully 
aware of her responsibilities to investigate suspicious prescriptions, 
and the steps she reported she would take to investigate largely 
mirrored those recommended by Dr. Alverson.'' RD, at 60. The ALJ was 
skeptical, however, that PIC Davison ``would consistently honor her 
commitment to regulatory compliance . . . in light of her conflicting 
priorities.'' Id. (referencing PIC Davison's repeated statements that 
she prioritized patient consultation over documentation and other legal 
requirements). He also referred to her remedial measures as 
``dilatory.'' Id. at 58. I am similarly skeptical that PIC Davison will 
consistently comply with her new recordkeeping procedures. The record 
demonstrates that for some of the established recordkeeping violations, 
such as the improperly documented paper and electronic orders of 
schedule II substances, PIC Davison was aware of and capable of 
fulfilling her obligations, but she chose not to prioritize compliance. 
``Past performance is the best predictor of future performance,'' Leo 
R. Miller, M.D., 53 FR 21,931, 21,932 (1998); and the ALJ found, and I 
agree, that the allegations sustained on the record in this matter 
``exhibit a near deliberate policy to de-prioritize the Respondent 
Pharmacy's record-keeping and corresponding prescription investigation 
responsibilities,'' RD, at 60.
    The ALJ recommended that ``the record supports the imposition of a 
sanction.'' RD, at 58. I agree that is the appropriate result on the 
record in this case.
    Respondent has not presented sufficient mitigating evidence to 
assure me that it can be entrusted with the responsibility carried by a 
DEA registration. As the ALJ noted in his Recommended Decision ``[t]he 
Respondent Pharmacy's case is characterized by non-compliance ab 
initio. The Respondent Pharmacy opened for business without a 
demonstrated commitment to regulatory compliance, both in [PIC] 
Davison's corresponding responsibility and its record-keeping, and only 
appears to have become compliant with the prospect of losing its 
registration.'' RD, at 59. The evidence shows that PIC Davison 
committed extensive violations of federal and state recordkeeping 
requirements, filled prescriptions that were not issued for a 
legitimate medical purpose in violation of her corresponding 
responsibility, and, perhaps most egregiously, continued to fill 
prescriptions lacking a legitimate medical purpose even after multiple 
discussions with DEA and state pharmacy board officials regarding her 
regulatory noncompliance. She also continued to violate federal law 
after the initiation of the proceedings to revoke her registration by 
submitting false statements on her registration renewal and 
falsification on an application for registration cannot be tolerated. 
Peter A. Ahles, M.D., 71 FR at 50,099; Hoxie, 419 F.3d at 483.
    Regarding general deterrence, the Agency bears the responsibility 
to deter similar misconduct on the part of others for the protection of 
the public at large. David A. Ruben, 78 FR at 38,385. I agree with the 
ALJ's conclusion that ``the Agency's interest in general deterrence is 
. . . best served here by the revocation of the Respondent Pharmacy's 
COR.'' RD, at 60. Based on the number and variety of the established 
violations in this case, a sanction less than revocation would send a 
message to the regulated community that ``due diligence is not a 
required condition precedent to operating as a registrant.'' Zion 
Clinic Pharmacy, 83 FR at 10,903.
    The ALJ recommended revocation as the appropriate sanction. RD, at 
60. A balancing of the statutory public interest factors, coupled with 
consideration of the Respondent Pharmacy's failure to accept full 
responsibility, the absence of record evidence of timely and committed 
remedial measures to guard against recurrence, and the Agency's 
interest in deterrence, supports the conclusion that the Respondent 
Pharmacy should not continue to be entrusted with a registration. The 
Respondent Pharmacy's false statements within its registration renewal 
application also supply an independent ground for revocation pursuant 
to section 824(a)(1). Accordingly, I shall order the sanctions the 
Government requested, as contained in the Order below.

IV. Order

    Pursuant to 28 CFR 0.100(b) and the authority vested in me by 21 
U.S.C. 824(a), I hereby revoke DEA Certificate of Registration 
FH4377291 issued to Heavenly Care Pharmacy. Further, pursuant to 28 CFR 
0.100(b) and the authority vested in me by 21 U.S.C. 823(f), I hereby 
deny any pending application of Heavenly Care Pharmacy to renew or 
modify this registration. This order is effective September 28, 2020.

Timothy J. Shea,
Acting Administrator.
[FR Doc. 2020-18975 Filed 8-27-20; 8:45 am]
BILLING CODE 4410-09-P