[Federal Register Volume 86, Number 241 (Monday, December 20, 2021)]
[Notices]
[Pages 71927-71928]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-27486]


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DEPARTMENT OF JUSTICE

Drug Enforcement Administration


Cypress Creek Pharmacy, LLC; Order

    On October 18, 2019, a former Assistant Administrator, Diversion 
Control Division, Drug Enforcement Administration (hereinafter, DEA or 
Government), issued an Order to Show Cause to Cypress Creek Pharmacy, 
LLC (hereinafter, Applicant), of Wesley Chapel, Florida. Order to Show 
Cause (hereinafter, OSC), at 1. The OSC proposed the denial of 
Applicant's application for a DEA Certificate of Registration because, 
according to the OSC, Applicant's registration with DEA would be 
inconsistent with the public interest. Id. (citing 21 U.S.C. 823(f) and 
824(a)(4)).
    In a Declaration dated August 3, 2021, a Diversion Investigator 
(hereinafter, the DI) assigned to the Tampa District Office, Miami 
Field Division, stated that on October 25, 2019, she met with 
Applicant's Registered Agent and Manager at the DEA Tampa District 
Office and ``personally served him with a copy of the [OSC].'' Request 
for Final Agency Action (hereinafter, RFAA), Exhibit (hereinafter, 
RFAAX) B, at 1-2. The DI also stated that since the service of the OSC, 
she has ``received no communications from anyone acting on behalf of 
[Applicant] regarding the [OSC].'' Id. at 2.
    The Government filed a Request for Final Agency Action 
(hereinafter, RFAA) on September 3, 2021. In its RFAA, the Government 
stated that Applicant is without authority to handle controlled 
substances in Florida, because its state pharmacy license recently 
expired. RFAA, at 1. The Government provided documentation from the 
Florida Department of Health to support this claim. See RFAAX B-1 and 
B-2. The Government then requested that I deny Applicant's application 
for a DEA registration based solely \1\ on the ground that Applicant 
lacks authority to handle controlled substances in Florida, the state 
where Applicant seeks a DEA registration. RFAA, at 1 and 6. The 
Government did not allege that Applicant lacked state authority in the 
OSC. See generally OSC.
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    \1\ The Government appears to have abandoned its public interest 
allegations in the RFAA, and therefore, I am not considering them.
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    Previous Agency decisions have stated that the Government is not 
required to issue an amended OSC to notice an allegation of a 
registrant's lack of state authority that arises during the pendency of 
a proceeding regarding a DEA registration. Hatem M. Ataya, M.D., 81 FR 
8221, 8244 (2016). Additionally, previous Agency decisions have stated 
that because the possession of state authority is a prerequisite for 
obtaining and maintaining a registration, the issue of state authority 
can be raised at any stage of a proceeding, even sua sponte by the 
Administrator. See id.; see also Joe M. Morgan, D.O., 78 FR 61,961, 
61,973-74 (2013). In those matters, however, the registrant had a 
meaningful opportunity, during at least one stage in the proceeding, to 
refute the Government's claim that the registrant lacked state 
authority. See, e.g., Ataya, 81 FR at 8245 (Administrator issued order 
directing parties to address whether registrant possessed state 
authority); Lesly Pompy, M.D., 84 FR 57,749, 57,749-50 (2019) (notice 
provided during administrative hearing); Morgan, 78 FR at 61,973-74 
(Government's post-hearing Motion for Summary Disposition provided 
adequate notice).
    Here, the Government cited to Lawrence E. Stewart, M.D., 86 FR 
15,257 (2021), to support the proposition that it was not required to 
issue a new OSC demonstrating lack of state authority. RFAA, at 3-4. 
Although Stewart is accurately quoted, it also supports the notion that 
the Agency must give some sort of notice and an opportunity to contest 
the new allegations. In this case, in spite of changing the grounds for 
denial two years after issuance of the OSC, the Government had not 
demonstrated that it had given any such opportunity to the Applicant. 
Accordingly, on October 15, 2021, I issued an Interim Order to 
Applicant permitting it to submit a response addressing whether 
Applicant currently holds state authority to handle controlled 
substances in Florida within fifteen calendar days from the date that 
my office served the Order on Applicant. Applicant sent an email in 
reply to my Interim Order on October 20, 2021, stating, ``I have closed 
the pharmacy and wish to close out of all matters dealing with the 
pharmacy and the process of all licensure.'' \2\ Email dated October 
20, 2021. I have received no further correspondence from Applicant 
regarding the Government's allegations of its lack of state authority.
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    \2\ In spite of Applicant's statement regarding its 
discontinuance of business, its application remains pending and I 
will continue to assess the application under 21 U.S.C. 823. See 
Lawrence E. Stewart, M.D., 86 FR 15,257 (2021).
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    Because Applicant has presented no evidence or statements related 
to its lack of state authority, I consider the evidence submitted by 
the Government on the lack of state authority allegation to be 
uncontested.
    I make the following findings of fact based on the record before 
me.

Findings of Fact

Applicant's Application for a DEA Registration

    On or about September 6, 2018, Applicant submitted an application 
for a DEA Certificate of Registration as a retail pharmacy in Schedules 
II through V with a proposed registered address at 26829 Tanic Drive, 
Suite 101, Wesley Chapel, Florida 33544. Applicant's application was 
assigned Control No. W18097945A. RFAAX B, at 1.

The Status of Applicant's State License

    In her Declaration, the DI sated that Applicant's state pharmacy 
license ``expired, without renewal, on February 28, 2021.'' RFAAX B, at 
2. The Declaration noted that ``that expiration was automatically 
extended until June 30, 2021 as part of the State of Florida's COVID-19 
response.'' Id. at n.3.
    According to Florida Department of Health's online records, of 
which I take official notice, Applicant's state pharmacy registration 
PH31651 is ``delinquent'' \3\ with a ``license expiration date'' of 
February 28, 2021.\4\

[[Page 71928]]

Florida Department of Health's License Verification, Licensee Lookup, 
https://mqa-internet.doh.state.fl.us/MQASearchServices/Home (last 
visited date of signature of this Order).
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    \3\ According to the state website, ``delinquent'' means ``[t]he 
license practitioner who held a CLEAR ACTIVE or CLEAR INACTIVE 
license, but failed to renew the license by the expiration date. The 
licensed practitioner is not authorized to practice in the [S]tate 
of Florida.'' https://mqa-internet.doh.state.fl.us/MQASearchServices//LicStatus.html#DELINQUENT.
    \4\ Under the Administrative Procedure Act, an agency ``may take 
official notice of facts at any stage in a proceeding--even in the 
final decision.'' United States Department of Justice, Attorney 
General's Manual on the Administrative Procedure Act 80 (1947) (Wm. 
W. Gaunt & Sons, Inc., Reprint 1979). Pursuant to 5 U.S.C. 556(e), 
``[w]hen an agency decision rests on official notice of a material 
fact not appearing in the evidence in the record, a party is 
entitled, on timely request, to an opportunity to show the 
contrary.'' Accordingly, Registrant may dispute my finding by filing 
a properly supported motion for reconsideration of finding of fact 
within fifteen calendar days of the date of this Order. Any such 
motion shall be filed with the Office of the Administrator and a 
copy shall be served on the Government. In the event Registrant 
files a motion, the Government shall have fifteen calendar days to 
file a response. Any such motion and response may be filed and 
served by email ([email protected]).
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    Accordingly, I find that Registrant currently is not licensed to 
engage in the practice of pharmacy in Florida, the state in which 
Applicant applied for registration with the DEA.

Discussion

    Pursuant to 21 U.S.C. 824(a)(3), the Attorney General is authorized 
to suspend or revoke a registration issued under section 823 of the 
Controlled Substances Act (hereinafter, CSA) ``upon a finding that the 
registrant . . . has had [its] State license or registration suspended 
. . . [or] revoked . . . by competent State authority and is no longer 
authorized by State law to engage in the . . . dispensing of controlled 
substances.'' With respect to a practitioner, the DEA has also long 
held that the possession of authority to dispense controlled substances 
under the laws of the state in which a practitioner engages in 
professional practice is a fundamental condition for obtaining and 
maintaining a practitioner's registration. See, e.g., James L. Hooper, 
M.D., 76 FR 71,371 (2011), pet. for rev. denied, 481 F. App'x 826 (4th 
Cir. 2012); Frederick Marsh Blanton, M.D., 43 FR 27,616, 27,617 (1978).
    This rule derives from the text of two provisions of the CSA. 
First, Congress defined the term ``practitioner'' to mean ``a pharmacy 
. . . or other person licensed, registered, or otherwise permitted, by 
. . . the jurisdiction in which he practices . . . , to distribute, 
dispense, . . . [or] administer . . . a controlled substance in the 
course of professional practice.'' 21 U.S.C. 802(21). Second, in 
setting the requirements for obtaining a practitioner's registration, 
Congress directed that ``[t]he Attorney General shall register 
practitioners . . . if the applicant is authorized to dispense . . . 
controlled substances under the laws of the State in which he 
practices.'' 21 U.S.C. 823(f). Because Congress has clearly mandated 
that a practitioner possess state authority in order to be deemed a 
practitioner under the CSA, the DEA has held repeatedly that revocation 
of a practitioner's registration is the appropriate sanction whenever 
he is no longer authorized to dispense controlled substances under the 
laws of the state in which he practices. See, e.g., James L. Hooper, 76 
FR at 71,371-72; Sheran Arden Yeates, M.D., 71 FR 39,130, 39,131 
(2006); Dominick A. Ricci, M.D., 58 FR 51,104, 51,105 (1993); Bobby 
Watts, M.D., 53 FR 11,919, 11,920 (1988); Frederick Marsh Blanton, 43 
FR at 27,617.
    According to Florida statute, ``It is unlawful for any person to 
own, operate, maintain, open, establish, conduct, or have charge of, 
either alone or with another person or persons, a pharmacy: (a) Which 
is not registered under the provisions of this chapter.'' \5\ Fla. 
Stat. Ann. Sec.  465.015(1). Further, ``the practice of the profession 
of pharmacy'' definition ``includes compounding, dispensing, and 
consulting concerning contents, therapeutic values, and uses of any 
medicinal drug \6\ . . . .'' Fla. Stat. Ann. Sec.  465.003(13) (West, 
2021).
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    \5\ The Government included an email from a Florida Medical 
Quality Assurance Investigator stating that ``[p]harmacies are not 
allowed to operate at all on a delinquent license.'' RFAA B-2, at 1 
(emphasis in original). This statement is supported by my analysis 
of Florida law.
    \6\ ``Medicinal Drugs'' or ``Drugs'' means ``those substances or 
preparations commonly known as `prescription' or `legend' drugs 
which are required by federal or state law to be dispensed only on a 
prescription . . . .'' Fla. Stat. Ann. Sec.  465.003(8).
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    Here, the undisputed evidence in the record is that Applicant 
currently lacks authority to operate a pharmacy in Florida. As already 
discussed, a pharmacy must be a licensed to dispense a medicinal drug, 
including a controlled substance, in Florida. Thus, because Applicant 
lacks authority to practice pharmacy in Florida and, therefore, is not 
authorized to dispense controlled substances in Florida, Applicant is 
not eligible to receive a DEA registration. Accordingly, I will order 
that Applicant's application for a DEA registration be denied.

Order

    Pursuant to 28 CFR 0.100(b) and the authority vested in me by 21 
U.S.C. 823(f), I hereby order that the pending application for a 
Certificate of Registration, Control Number W18097945A, submitted by 
Cypress Creek Pharmacy, LLC is denied, as well as any other pending 
application of Cypress Creek Pharmacy, LLC for additional registration 
in Florida. This Order is effective January 19, 2022.

Anne Milgram,
Administrator.
[FR Doc. 2021-27486 Filed 12-17-21; 8:45 am]
BILLING CODE 4410-09-P