**[Table of Contents]{.underline}**

**Page**

**EXECUTIVE SUMMARY 1**

**INTRODUCTION 4 Background**

**Scope**

**Methodology**

**FINDINGS 6**

**Management Controls are in Place**

**Statistical Data**

**RECOMMENDATIONS 10**

**Conclusion and Recommendations**

**Program Comments**

**APPENDIX**

**EXECUTIVE SUMMARY**

**BACKGROUND**

In accordance with NIH Policy Manual 1750 entitled, *NIH Management
Control Program*, the Division of Quality Management (DQM), Office of
Management Assessment (OMA), conducted a Management Control Review (MCR)
of the NIH handling and safeguarding of Controlled Substances for
nonhuman use.

NIH Policy Manual 1345 entitled, *NIH Handling and Safeguarding Of
Controlled Substances For Nonhuman Use* was re-issued in July 2000. The
policy describes policies and procedures for handling and safeguarding
Controlled Substances for nonhuman use in the NIH Intramural Research
Program, from acquisition through disposal, as required by the
Comprehensive Drug Abuse Prevention and Control Act of 1970 (PL-530).
The MCR was conducted to determine NIH compliance with the reissued
policy.

**OBJECTIVE**

The MCR objective was to determine if the NIH Handling and Safeguarding
of Controlled Substances for Nonhuman Use Program has reasonable
controls and are producing intended results.

**SUMMARY OF FINDINGS**

Our review and testing of internal controls revealed no evidence of
substantive material weaknesses. As a whole, the Program is still
evolving with most of the ICs not completely implementing the policy
until OMA announced the MCR in October 2001.

Our review revealed that there are essentially two types of Controlled
Substance on-site Programs: Animal Care Programs and Bench Research
Programs. Eleven of the Custodians interviewed or 18% percent represent
Animal Care Programs. These Programs have a significantly higher
percentage of Controlled Substance usage, and in most cases, require
additional non-Custodial access to the Locked Boxes. The other 82% of
Custodians interviewed represent Bench Research Programs. These
Programs, even those that utilize rodents and other animals, typically
utilize fewer Controlled Substances in smaller amounts.

There are over 200 Controlled Substances listed in the DEA Controlled
Substance Schedule indexed into five

sub-schedules. The DEA list describes the basic or parent chemical and
does not describe the salts, isomers and salts of isomers, esters,
ethers and derivatives which may be Controlled Substances. There are 75
Controlled Substances in the NIH Controlled Drug Inventory. The NIH
Controlled Substance Officer has DEA registration to acquire Controlled
Substances in Schedule 2 thru 5. Ketamine HCL and Diazepam are the most
used Substances. Programs requiring Schedule 1 Substances must obtain
Schedule 1 Certification from the DEA. Two Custodians interviewed had
current DEA Schedule 1 Certification. Our review revealed that three
Custodians had Schedule 1 Substances in their Locked Boxes.

Our review also revealed:

-   88% percent of Custodians interviewed knew the proper procedure for
    ordering Controlled Substances.

-   82% percent of Custodians interviewed knew the proper procedure for
    disposing of Controlled Substances no longer needed or that have
    expired.

-   68% percent of Custodians interviewed conducted Physical Inventories
    of their Controlled Substances in accordance with NIH Policy Manual
    1345.

-   30% of Custodians interviewed maintain written records of their
    Physical Inventories.

-   79% of the Locked Boxes we examined are accessed by persons other
    than the Custodian.

-   22% of the Locked Boxes we examined were not in compliance with the
    policy description of what constitutes a Locked Box.

**RECOMMENDATIONS**

The primary recommendation for the NIH Handling and Safeguarding of
Controlled Substances for Nonhuman Use Program is to develop a fully
automated system for ordering Controlled Substances and tracking usage.
The system should have electronic requisition, disposal and inventory
forms with real time and e-Signature capabilities. The system should
also be password protected, interactive, able to flag occurrences of
unusual activity, and be NIH IT infrastructure compatible. Other
recommendations are:

-   Register all off-site Locked Boxes with the NIH Controlled Substance
    Officer.

-   Allow special exemptions that permit Contracted Personnel to be
    Custodians in off-site Programs.

-   Revise NIH Policy Manual 1345 to reflect that Alternate Controlled
    Substance Coordinators, who are also Custodians, must get the
    approval signature of the Coordinator (or another Alternate
    Coordinator) on the request form before the order is approved by the
    NIH Controlled Substance Officer.

-   More clearly define in the policy and communication what constitutes
    a Locked Box.

-   Require Custodians to keep written/electronic logs of all Physical
    Inventories.

-   Require that Custodians conduct Physical Inventories biannually.
    Currently, the requirement is "a minimum of every 3 months."

-   Require all Coordinators to keep an electronic log of all their
    Custodians and Locked Boxes.

-   Add a link of the DEA Website to NIH Policy Manual 1345. Include
    links to DEA Policies and the DEA Controlled Substance Listings.

-   Create a Pharmacy Technician position under the NIH Controlled
    Substance Officer.

-   Dispose of all C-1 Controlled Substances currently possessed by
    Custodians without C-1 DEA Certifications.

-   Conduct a review of the NIH Handling and Safeguarding of Controlled
    Substances for Nonhuman Use Program 1-2 years after all accepted
    recommendations have been implemented.

-   Create an electronic training module and frequently asked questions
    page (FAQ) on the Veterinary Research Program (VRP) Website.

**INTRODUCTION**

**BACKGROUND**

In July 1992, at the request of the Associate Director for
Administration, NIH, a "Review of Acquiring and Safeguarding Controlled
Substances at NIH" was initiated. The review examined the way that
Controlled Substances were ordered, received, maintained, inventoried,
and disposed of at NIH. In particular, a committee of NIH scientists and
administrators, who were involved in acquiring and safeguarding
Controlled Substances, was established to determine if the NIH
maintenance and disposal procedures were sufficient to reasonably assure
the security of the Controlled Substances and the integrity of the
record-keeping process.

Deficiencies were identified in the handling and safeguarding of
Controlled Substances for nonhuman use, and the Committee, in
collaboration with the Office of Management Assessment (OMA), NIH,
developed a Corrective Action Plan (CAP). The most important component
of the CAP was the issuance in January 1997 of NIH Policy Manual 1345
entitled, *HANDLING AND SAFEGUARDING OF CONTROLLED SUBSTANCES FOR
NONHUMAN USE*.

In October 1997, the NIH Veterinary Resources Program was transferred
from the National Center for Research Resources to the Office of
Research Services (ORS). This reorganization required ORS to perform
some additional steps before NIH Policy Manual 1345 could be implemented
NIH-wide. These steps included revising and re-issuing the policy to
reflect the transfer of the Program to ORS, obtaining the Delegation of
Authority to appoint an NIH Controlled Substance Officer, developing and
implementing training for personnel in the new procedures, conducting an
NIH-wide Controlled Substances Inventory, implementing new forms
requirements, and establishing a system of policy oversight for NIH
off-site DEA regulated Control Substances Programs.

NIH Policy Manual 1345 was re-issued in July 2000 (**Enclosure A**). The
policy describes policies and procedures for handling and safeguarding
Controlled Substances for nonhuman use in the NIH Intramural Research
Program, from acquisition through disposal, as required by the
Comprehensive Drug Abuse Prevention and Control Act of 1970 (PL-513).

**SCOPE AND METHODOLOGY**

In accordance with NIH Manual Chapter 1750 entitled, *NIH Management
Control Program* (**Enclosure B**), the Division of Quality Management
(DQM), OMA, conducted a Management Control Review (MCR) of the NIH
handling and safeguarding of Controlled Substances for nonhuman use.

DQM, with the assistance of the NIH Controlled Substance Officer and IC
points of contact, developed Checklists (**Enclosure C**) that
incorporated NIH Policy Manual 1345 requirements. The Checklists were
used to interview Controlled Substance Coordinators and a targeted
sampling of Controlled Substance Custodians, as well as to examine
supporting documentation used by the interviewees for acquiring,
safeguarding, and disposing of Controlled Substances.

There were 113 Custodians of 131 Locked Boxes representing 17 ICs and
Offices in Bethesda, Rockville, and Poolesville, MD. Sixteen of the 17
Coordinators were either interviewed or given an electronic copy of the
questionnaire for completion. One Coordinator was on maternity leave.
Nine Coordinators or 53% responded to the questionnaire. Eight Alternate
Coordinators were also interviewed. Sixty of the 113 Custodians or 53%
were interviewed and 76 of the 131 Locked Boxes or 67% were inspected.
Custodians were selected for participation based on three criteria:
location of their Locked Box; number of Locked Boxes they have; and if
they also hold the title of Alternate Controlled Substance Coordinator.
Coordinators and Custodians from all 17 ICs that have Programs were
represented.

NIH has five off-site Programs authorized to procure Controlled
Substances and DEA regulated chemicals for nonhuman use under research
licenses granted to those organizations by the DEA. The five off-site
Programs are in Baltimore, MD (2), Frederick, MD, Research Triangle
Park, NC, and Rocky Mountain Laboratories, MT. The scope of NIH Policy
Manual 1345 does not cover those programs. However, DQM developed a
checklist and submitted it to those Programs electronically in an effort
to verify that they have internal policies and procedures in place
governing Controlled Substances that are in accordance with the DEA
Controlled Substance Act and are consistent with NIH Policy.

**FINDINGS**

**Management Controls are in Place**

Our review and testing of internal controls revealed no evidence of
substantive material weaknesses or violations of ethics. All Programs
examined were operating under NIH Policy Manual 1345, reissued July 7,
2000. As a whole, the Program is still evolving, with most of the ICs
not completely implementing the policy until OMA issued its MCR
announcement memorandum in October 2001

(**Enclosure D**). Our findings are based on information provided by
nine Controlled Substances Coordinators, eight Alternate Controlled
Substance Coordinators, and 60 Controlled Substance Custodians
representing 17 ICs and Offices.

Our review revealed that there are essentially two types of on-site
Programs: Large Animal Care Programs and Bench Research Programs. Eleven
of the Custodians interviewed or 18 percent were large Animal Care
Programs. These Programs use significantly larger amounts of Controlled
Substances, and in most cases, require additional non-Custodial access
to the Locked Boxes. Several of these Programs are also responsible for
supplying Controlled Substances to other Labs or ICs and some have set
up inventory and distribution sub-systems.

The most elaborate is run by Dr. Charles Watson of the National Eye
Institute (NEI), located in building 49 on the Bethesda campus. Dr.
Watson and Mr. Jerome Albright, his Supervisory Lab Technician, maintain
13 "Sub-Locked Boxes" located throughout the Facility. Fifteen
Veterinarians, PhDs, and Lab and Animal Care Technicians representing
NEI, the National Institute of Mental Health, and the National Institute
of Neurological Disorders and Stroke utilize the Sub-Locked Boxes. Each
Sub-Locked Box is a double combination Locked Box, the combinations are
changed biannually, and each IC only has access to its respective
Sub-Locked Box. Dr. Watson and Mr. Albright maintain a "Primary Locked
Box" where all the procured Controlled Substances are initially
inventoried. The 13 Sub-Locked Boxes are then supplied from the Primary
Locked Box as needed. They also maintain an electronic inventory of all
their Controlled Substances, with built in prompts, that notifies them
when inventories fall below pre-defined levels.

Bench Research Programs represent the majority of individual uses of
Controlled Substances Programs. These programs, including those that
utilize rodents and other small animals, typically utilize fewer
Controlled Substances in small amounts. Since Controlled Substance usage
amongst these Custodians is more sporadic, many more inconsistencies and
technical lapses were found.

![](media/image1.wmf)

In addition, we reviewed all five off-site Programs. We submitted
checklist to all five programs electronically, and all five responded in
a timely manner. All five have Controlled Substance Coordinators and
Alternate Coordinators in place. Four of the five Programs have written
internal policies and procedures for the handling and safeguarding of
Controlled Substances, and all five Programs secure their Controlled
Substances in Locked Boxes in accordance with the Controlled Substances
Act, Title II of the Comprehensive Drug Abuse Prevention and Control Act
of 1970.

**Statistical Analysis**

The 60 Controlled Substance Custodians interviewed were: Veterinarians
(11), PhDs (22), BS or MS Biologists (15), Chemist (1), and Facility
Managers, Lab Managers, or Animal Care Technicians (11).

![](media/image2.wmf)

**Knowledge of Policy and Procedures**

Fifty-three of the sixty or 88% of the Custodians interviewed knew the
procedure for ordering Controlled Substances. Forty-nine of the sixty or
82% knew the correct procedure for disposing of Controlled Substances
that have expired or are no longer needed. Forty-one Custodians or 68%
conducted Physical Inventories of their Locked Boxes in accordance with
NIH Policy, but only 18 Custodians or 30% keep written or electronic
records of those inventories.

Eleven Custodians or 18% have multiple Locked Boxes assigned to them and
seven Custodians or 12% are also Alternate Coordinators. Fifty-eight of
the 76 or 76% of the Locked Boxes examined are accessed by persons other
than the Custodian.

![](media/image3.wmf)

**Locked Boxes**

According to NIH Policy, all Controlled Substances and DEA regulated
chemicals are to be kept secured "in a lock box or double locked steel
cabinet..." Our review revealed that while most Custodians were
compliant with policy, there were some areas for improvement.

Forty-five of the Locked Boxes inventoried were Double-Locked Boxes
mounted on walls, 13 were Floor Safes, 11 were Steel Pad-Locked Floor
Cabinets, and four were Pad-Locked Desk or Lab Drawers. The review also
revealed 13 additional types of storage media that fell outside the
policy definition of what constitutes a Locked Box. They included:
Refrigerated Storerooms, Portable, a Clear-Plexi-glass Radiation Box, a
Chemical Storeroom, and a Plexi-glass Reinforced Paper Towel Dispenser.
In total, 17 of the 76 Locked Boxes inventoried or 22% were not in
compliance with the policy's description of what constitutes a Locked
Box.

Sixty of the 76 Locked Boxes inventoried were Key-Locked Boxes.
Twenty-one Custodians interviewed stated that they keep the keys to
their Locked Boxes on their person. Other places that our review
revealed that keys were kept included: locked drawer (10); locked office
or lab (7); unlocked drawer (15); other (7). Other places included:
hanging on walls, hanging on side of cabinets, and sitting on lab shelf
or desktops. In total, 22 of the 60 keys or 37% were found to be in
unsecured environments.

**RECOMMENDATIONS**

**Conclusion and Recommendations**

As a whole, the NIH Handling and Safeguarding of Controlled Substances
for Nonhuman Use Program have reasonable controls in place that are
producing the intended results. However, our review did identify
technical lapses related to the timeliness and completeness of ICs
implementing the policy, as well as areas for Program improvement.

The primary recommendation for the NIH Handling and Safeguarding of
Controlled Substances for Nonhuman Use Program is to develop a fully
automated system for ordering and tracking Controlled Substance usage.
The system should have electronic requisition, disposal and inventory
forms with real time and e-Signature capabilities. The system should
also be password protected, interactive, able to flag occurrences of
unusual activity, and be NIH IT infrastructure compatible. Other
recommendations are:

-   Register all off-site Locked Boxes with the NIH Controlled Substance
    Officer.

-   Allow special exemptions that permit Contracted Personnel to be
    Custodians in off-site Programs.

-   Revise NIH Policy Manual 1345 to reflect that Alternate Controlled
    Substance Coordinators, who are also Custodians, must get the
    approval signature of the Coordinator (or another Alternate
    Coordinator) on the request form before the order is approved by the
    NIH Controlled Substance Officer.

-   More clearly define in the policy and communication what constitutes
    a Locked Box.

-   Require Custodians to keep written/electronic logs of all Physical
    Inventories.

-   Require that Custodians conduct Physical Inventories biannually.
    Currently, the requirement is "a minimum of every 3 months."

-   Require all Coordinators to keep an electronic log of all their
    Custodians and Locked Boxes.

-   Add a link of the DEA Website to NIH Policy Manual 1345. Include
    links to DEA Policies and the DEA Controlled Substance Listings.

-   Create a Pharmacy Technician position under the NIH Controlled
    Substance Officer.

-   Dispose of all C-1 Controlled Substances currently possessed by
    Custodians without C-1 DEA Certifications.

-   Conduct a review of the NIH Handling and Safeguarding of Controlled
    Substances for Nonhuman Use Program 1-2 years after all accepted
    recommendations have been implemented.

-   Create an electronic training module and frequently asked questions
    page (FAQ) on the Veterinary Research Program (VRP) Website.

**Program Comments (Quotes and Paraphrases)**

During my time in the Army, we were to have a disinterested witness
present at control substances inventories; this individual was usually a
member of our supply section. This approach diffused concerns of
collusion between those who have management authority over controlled
substances.

I would like to support your proposal that the drug inventories for each
locked box be computerized. This would save staff time in conducting
inventories and would provide records more amenable to searching than
would written records.

I wonder if you want to consider discussing/recommending strategies for
training and supervision of custodians. I note that this overview did
find a significant number of inappropriate locked boxes, and faulty
record keeping procedures, but it makes no recommendations about how
this sort of thing will be prevented in the future, or rectified in the
present... I assume the controlled substance coordinators for the
individual institutes are responsible for checking on the practices of
the custodians, and seeing that they maintain appropriate locked boxes
and reports. If these individuals are not responsible for making some
regular check on the custodians, who is? What are the procedures for
seeing that this is done?

I don't believe there are any procedures in place for refreshing
custodians with regard to controlled substances practices. In my
experience, there has been only one meeting ever with our coordinator,
and no on-site follow up to see what kind of locked box or record
keeping was in place.

How to dispose of C-1 substances? I have been holding some for almost a
year wanting to get rid of them. I gather it is difficult to coordinate
with proper 'burn' but I would think the report might recommend a way to
address this problem.

If the objective is to have 2 people sign each order then that is what
should be put in the procedure not that it applies to alternates who are
also custodians. If a coordinator or alternate was serving as the
signature authority in the absence of the custodian then there should
also be another signature on the order.