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Droguería Betances to pay $12M settlement with federal authorities

A federal court in Puerto Rico entered a consent decree requiring Droguería Betances LLC, a major distributor of pharmaceutical drugs on the island, to pay $12 million and make extensive improvements to its compliance program, the U.S. Justice Department announced.

The consent decree settles a complaint filed by the United States, as News is my Business exclusively reported, alleging that from 2016 through at least June 2019, Betances did not report to the Drug Enforcement Administration (DEA) hundreds of “suspicious orders” for opioids and other controlled substances it distributed to pharmacy customers, orders that were unusual in their frequency, size or other patterns.

The complaint included at least 655 suspicious orders for fentanyl and at least 113 for oxycodone, both frequently misused and contributing to the opioid epidemic.

Several days after the complaint was filed, Droguería Betances issued a statement saying it had reached an agreement with the federal authorities, News is my Business also reported.

The U.S. government’s complaint also alleged that from May 2017 to July 2018, Betances failed to make required reports of its distribution transactions to the DEA via an automated system, including all of Betances’ distributions of Schedule II opioids during that time — totaling more than 7.8 million dosage units.

Betances was also accused of numerous recordkeeping violations, such as processing orders with faulty forms and submitting inaccurate shipping information to DEA.

Under the consent decree, following a financial analysis by the Justice Department considering the company’s ability to pay, Betances must pay $12 million over five years, with $10.2 million in civil penalties and $1.8 million in forfeiture.

Compliance improvements required
The decree requires Betances to make extensive improvements to its compliance program. Betances must also implement improved controlled substance monitoring program procedures and systems to review all orders of controlled substances and to detect and report suspicious orders to DEA.

The company must also improve its procedures and systems for conducting due diligence reviews of its pharmacy customers.

The consent decree further requires Betances to submit annual reports about its compliance program and customers to the DEA and other Justice Department components. Betances must also improve its ARCOS reporting system to ensure proper and accurate reporting of all acquisitions and distributions of Schedule II controlled substances.\

“Companies that distribute controlled substances to pharmacies and other points of sale have an important responsibility to help stop the illegal distribution of controlled substances by reporting suspicious orders to DEA,” said Principal Deputy Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division.

“The department will continue to work with its law enforcement partners to hold accountable those who fail to fulfill their reporting obligations,” Boynton said.

“The duty to report suspicious orders and other reporting requirements imposed on wholesale pharmaceutical distributors by the Controlled Substance Act is critical to ensuring the safety of our citizens from potential harm, including those associated with drug diversion, drug tampering and drug overdoses resulting from illegal drug sales and consumption,” said U.S. Attorney W. Stephen Muldrow for the District of Puerto Rico.

“The U.S. Attorney’s Office will continue to do everything in our power to ensure compliance and will use all legal remedies available to hold corporate entities and individuals accountable,” he said.

The DEA’s Diversion Control Division, Caribbean Division and San Juan Division Office conducted the investigation

“As we continue to face unprecedented loss of American lives during the ongoing opioid epidemic, DEA believes that everyone within the pharmaceutical supply chain is responsible for doing their due diligence to prevent the diversion of controlled substances,” said Assistant Administrator Thomas W. Prevoznik of the DEA’s Diversion Control Division.

“Compliance with the law is one of the best acts of prevention our registrants can do to ensure that these drugs are distributed for legitimate medical use. Reporting suspicious orders is required under the law and a key part in keeping our communities safe,” said Prevoznik.

Assistant U.S. Attorneys David O. Martorani-Dale and Gabriella S. Paglieri for the District of Puerto Rico, along with trial attorney Tom Rosso of the Civil Divison’s Consumer Protection Branch, represented the United States.

Author Details
Author Details
Business reporter with 29 years of experience writing for weekly and daily newspapers, as well as trade publications in Puerto Rico. My list of former employers includes Caribbean Business, The San Juan Star, and the Puerto Rico Daily Sun, among others. My areas of expertise include telecommunications, technology, retail, agriculture, tourism, banking and most other segments of Puerto Rico’s economy.

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