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Major Opioid Distributor Indicted on Felony Drug Charges for Fueling the Opioid Epidemic
May 15, 2019
Rochester Drug Cooperative is the 6th largest pharmaceutical distributor in the nation and they have recently reached an agreement to pay the federal government $20 million in order to settle various disputes that have allegedly contributed to the opioid crisis. Not only do these civil and criminal disputes claim that Rochester Drug Cooperative helped ignite and fuel the opioid epidemic, but it also marks the first time a pharmaceutical distributor has had federal charges against company executives for their responsibility in illegally distributing opioids.
The cooperative ships pharmaceuticals to more than 1,300 pharmacies and health care stores in the northeast. The pharmaceutical distributor, their retired CEO, and former chief of compliance were charged with illicitly conspiring to defraud the Drug Enforcement Agency (DEA) and with the illegal distribution of prescription opioids like oxycodone and fentanyl. These indictments come after Rochester Drug Cooperative has been under close watch by the DEA over the last two years.
Although a $20 million settlement was agreed upon, the former company CEO, Laurence Doud, is still being charged on counts of conspiracy and could face more than 10 years in prison if found guilty. In addition, 60 doctors, pharmacists, and other medical professionals were charged in the connection of 32 million prescription opioids that were illegally prescribed and distributed.
Prosecutors allege that Doud encouraged his employees to ignore red flags regarding specific pharmacy customers for his own financial gain. Between 2012 and 2016, Time Magazine reports that the company’s sales of oxycodone increased by 800% and fentanyl by 2,000%, driving more and more revenue to the company and Doud himself. Evidence suggests that Doud and other company executives purposefully ignored the plentiful increase in sales and avoided alerting federal regulators about their suspicious customers orders. On the contrary, Doud claims he was dismissed from Rochester Drug Cooperative so the company could place blame on him while they were under investigation by the DEA. He has expressed that he was defamed and pushed out of his previous role by Rochester Drug Cooperative’s current CEO and Chief Financial Officer.
Despite the fact that their internal office flagged more than 8,300 prescription orders that exceeded federally mandated monthly purchase thresholds, only four of these red flags were ever formally reported to the DEA. Rather than reporting them, the company raised its purchasing limits for specific customers in order to avoid an alert being triggered within the internal system.
These indictments mark a major milestone in an effort to stop the opioid epidemic that is killing hundreds of citizens each day. It is unique in the way that it finally holds opioid distributors accountable for profiting off of people who suffer from opioid addiction by charging their executives with drug trafficking. The evidence makes a clear statement that pharmaceutical distributors are knowingly participating in the illegal distribution of prescription opioids. While federal regulation requires suspicious orders and pharmacy customers to be reported to the DEA, many of these red flags were ultimately ignored by Rochester Drug Cooperative.
Failing to address the issue of over-prescribing opioid medications is simply allowing the opioid epidemic to continue to run rampant. The CDC reports that more than 130 people die each day to an opioid-related overdose, and more than 218,000 people have overdosed on prescription opioids between 1999 and 2017. In order to begin to tackle the opioid crisis, those who are fueling it need to be held accountable for their actions.
Ray Donovan, a special agent from the DEA, released a statement expressing that the “charges should send shock waves throughout the pharmaceutical industry reminding them of their role as gatekeepers of prescription medication.”
While law enforcement has been tirelessly trying to combat the opioid crisis by tracking down drug dealers and cartels who traffick drugs into the United States, major pharmaceutical distributors have been effortlessly getting away with over-prescribing pharmaceutical opioids like fentanyl and oxycodone. This case shines a light on the idea that much of the opioid epidemic came from inside our nation by those who are supposed to be regulating it.
Hopefully, this case will light a fire among opioid manufacturers and distributors to encourage them to file suspicious order reports when necessary rather than focusing on financial gain.
Rochester Drug Cooperative admitted to “making mistakes” and has recently undergone new management in order to mend and avoid past mistakes. They claim to be making drastic changes within the company that focus on compliance with federal mandates. Along with the $20 million settlement, the company will be strictly monitored over the next three years by an expert who will be reporting to the DEA.
Time Magazine Ex-CEO Laurence Doud is First Drug Company
New York Times Pharmaceutical Distributor Faces Federal Criminal Charges