[Federal Register Volume 86, Number 125 (Friday, July 2, 2021)]
[Notices]
[Pages 35336-35338]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-14165]


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DEPARTMENT OF JUSTICE

Drug Enforcement Administration


Spring Valley Family Pharmacy; Decision and Order

    On April 12, 2021, the Assistant Administrator, Diversion Control 
Division, Drug Enforcement Administration (hereinafter, Government), 
issued an Order to Show Cause (hereinafter, OSC) to Spring Valley 
Family Pharmacy (hereinafter, Registrant) of Gallipolis, Ohio. OSC, at 
1. The OSC proposed the revocation of Registrant's Certificate of 
Registration (hereinafter, registration) No. FS7068249. Id. It alleged 
that Registrant ``currently lacks state authority to handle controlled 
substances.'' Id. (citing 21 U.S.C. 824(a)(3)).
    Specifically, the OSC alleged that on or about October 2, 2020, 
Registrant permanently and voluntarily surrendered its Ohio state 
pharmacy license to the State of Ohio Board of Pharmacy with the 
surrender effective on October 5, 2020. Id. at 2. According to the OSC, 
Registrant permanently and voluntarily surrendered its Ohio state 
pharmacy license ``after its owner and primary operator, Brandon 
O'Callaghan, permanently and voluntarily surrendered his state 
pharmacist license after testing positive for controlled substances in 
violation of a Board Order.'' Id. The OSC concluded that because 
Registrant is ``currently without authority to handle controlled 
substances in Ohio, the state in which [Registrant] is registered with 
DEA. . . . DEA must revoke [Registrant's] registration. . . .'' Id.
    The OSC notified Registrant of the right to request a hearing on 
the allegations or to submit a written statement, while waiving the 
right to a hearing, the procedures for electing each option, and the 
consequences for failing to elect either option. Id. at 2-3 (citing 21 
CFR 1301.43). The OSC also notified Registrant of the opportunity to 
submit a corrective action plan. Id. at 3 (citing 21 U.S.C. 
824(c)(2)(C)).

Adequacy of Service

    In a Declaration dated June 8, 2021, a Diversion Investigator 
(hereinafter, the DI) assigned to the Charleston District Office, 
Louisville Field Division, stated that she and a Tactical Diversion 
Squad Group Supervisor traveled to the residence of Brandon 
O'Callaghan, the former owner and pharmacist for Spring Valley Family 
Pharmacy, in Winfield, West Virginia on April 26, 2021. Request for 
Final Agency Action, dated June 9, 2021 (hereinafter, RFAA), Exhibit 
(hereinafter, RFAAX) 3 at 1. The DI stated that on that date, she 
``personally handed Mr. O'Callaghan a copy of the [OSC].'' Id. The DI 
also stated that ``Mr. O'Callaghan signed Form DEA-12 Receipt for Cash 
or Other Items, which indicated that he received a copy of the [OSC].'' 
Id. In her Declaration, the DI included a true and correct copy of the 
DEA-12 that Mr. O'Callaghan signed. RFAAX 3, Appendix (hereinafter, 
App.) A.
    The Government forwarded its RFAA, along with the evidentiary 
record, to this office on June 10, 2021. In its RFAA, the Government 
represents that ``[Registrant] has not submitted a timely request for a 
hearing in this matter.'' \1\ RFAA, at 1.
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    \1\ The Government included a second DI Declaration, dated June 
9, 2021, in its RFAA, which stated that ``DEA has not received any 
correspondence from Spring Valley Family Pharmacy concerning the 
[OSC].'' RFAAX 4, at 2.
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    The Government seeks to ``revoke the [DEA COR] of [Registrant] 
because [Registrant] lacks authority to handle controlled substances in 
the State of Ohio, the state where [Registrant] is registered with 
DEA.'' Id. The Government requests that the Administrator revoke 
Registrant's DEA registration. Id. at 5.
    Based on the DI's Declaration, the Government's written 
representations, and my review of the record, I find that the 
Government accomplished service of the OSC on Registrant on April 26, 
2021. I also find that more than thirty days have now passed since the 
Government accomplished service of the OSC. Further, based on the 
Government's written representations, I find that neither Registrant, 
nor anyone purporting to represent the Registrant, requested a hearing, 
submitted a written statement while waiving Registrant's

[[Page 35337]]

right to a hearing, or submitted a corrective action plan. Accordingly, 
I find that Registrant has waived the right to a hearing and the right 
to submit a written statement and corrective action plan. 21 CFR 
1301.43(d) and 21 U.S.C. 824(c)(2)(C). I, therefore, issue this 
Decision and Order based on the record submitted by the Government, 
which constitutes the entire record before me. 21 CFR 1301.43(e).

Findings of Fact

Registrant's DEA Registration

    Registrant is the holder of DEA Certificate of Registration No. 
FS7068249 at the registered address of 448 Jackson Pike, Gallipolis, OH 
45631. RFAAX 1 (Certificate of Registration). Pursuant to this 
registration, Registrant is authorized to dispense controlled 
substances in schedules II through V as a retail pharmacy. Id.

The Status of Registrant's State License

    On October 5, 2020, the State of Ohio Board of Pharmacy 
(hereinafter, Board) issued a ``Settlement Agreement with the State of 
Ohio Board of Pharmacy'' (hereinafter, Settlement Agreement). RFAAX 4, 
App. A. According to the Settlement Agreement, the Board had initiated 
an investigation of Registrant, a pharmacy licensed as a ``Terminal 
Distributor of Dangerous Drugs,'' and Brandon O'Callaghan, owner and 
operator of Registrant, related to Mr. O'Callaghan's ``illicit drug 
usage and failure to ensure [Registrant] [met] minimum standards and 
maintained sanitary compounding area conditions to ensure public 
safety.'' Id. at 1. The Settlement Agreement states that on or about 
June 19, 2019, the Board sent Registrant a Summary Suspension/Notice of 
Opportunity for Hearing and that Registrant subsequently requested a 
hearing by and through counsel on or about July 15, 2019. Id. The 
hearing was held on or about November 5, 2019, and resulted in a Board 
Order that placed both Registrant's license and Mr. O'Callaghan's 
license on indefinite suspension subject to certain conditions. Id. at 
2. According to the Settlement Agreement, on or about January 8, 2020, 
Mr. O'Callaghan violated the terms of the Order by ``testing positive 
for amphetamine (454 ng/ml) and methamphetamine (2368 ng/ml).'' Id. 
According to the Settlement Agreement, Mr. O'Callaghan subsequently 
surrendered his pharmacy license on May 5, 2020, and thus Registrant 
``no longer [had] a Responsible Person or owner that [was] lawfully 
allowed to possess'' its license. Id. Under the terms of the Settlement 
Agreement, Registrant permanently and voluntarily surrendered to the 
Board its license and registration. Id. at 2.
    According to Ohio's online records, of which I take official 
notice, Registrant's state pharmacy license remains inactive.\2\ 
https://elicense.ohio.gov/OH_HomePage (last visited date of signature 
of this Order). Accordingly, I find that Registrant is not currently 
licensed to dispense controlled substances in Ohio, the state in which 
Registrant is registered with the DEA.
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    \2\ 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 and response shall be filed and served by email to the other 
party and to Office of the Administrator, Drug Enforcement 
Administration at <a href="/cdn-cgi/l/email-protection#8eeaebefa0efeaeae1a0effafae1fce0ebf7fdceeaebefa0fbfdeae1e4a0e9e1f8"><span class="__cf_email__" data-cfemail="482c2d2966292c2c2766293c3c273a262d313b082c2d29663d3b2c2722662f273e">[email protected]</span></a>.
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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 his 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 [it] 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.
    Under Ohio law, a terminal distributor of dangerous drugs ``means a 
person who is engaged in the sale of dangerous drugs \3\ at retail . . 
. '' and ``includes pharmacies . . . and all other persons who procure 
dangerous drugs for sale or other distribution by or under the 
supervision of a pharmacist . . . or any other person authorized by the 
board of pharmacy.'' Ohio Rev. Code Ann. Sec.  4729.01(Q) (West 2021). 
Further, Ohio law provides that, other than a licensed terminal 
distributor of dangerous drugs and other inapplicable exceptions, ``no 
person shall do any of the following: (a) Sell or distribute, at 
retail, dangerous drugs; (b) possess for sale, at retail, dangerous 
drugs; (c) possess dangerous drugs.'' Ohio Rev. Code Ann. Sec.  
4729.51(E)(1) (West 2021).
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    \3\ The definition of ``dangerous drugs'' includes a drug that 
``may be dispensed only upon a prescription'' under revised code 
section 3719. Ohio Rev. Code. Ann. Sec.  3719.41 states that the 
state board of pharmacy shall adopt rules establishing the schedules 
of controlled substances ``incorporating the five schedules of 
controlled substances under the federal drug abuse control laws.''
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    Here, the undisputed evidence in the record is that Registrant 
surrendered its license as a terminal distributor of dangerous drugs in 
Ohio. As already discussed, a terminal distributor of dangerous drugs 
must be licensed to be authorized to possess or distribute controlled 
substances in Ohio. Thus, because Registrant permanently and 
voluntarily surrendered its Ohio state pharmacy license and, therefore, 
is not authorized to dispense controlled substances in Ohio, Registrant 
is not eligible to maintain a DEA registration. Accordingly, I will 
order that Registrant's DEA registration be revoked.

[[Page 35338]]

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 No. 
FS7068249 issued to Spring Valley Family 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 Spring Valley Family Pharmacy to 
renew or modify this registration, as well as any other pending 
application of Spring Valley Family Pharmacy for additional 
registration in Ohio. This Order is effective August 2, 2021.

D. Christopher Evans,
Acting Administrator.
[FR Doc. 2021-14165 Filed 7-1-21; 8:45 am]
BILLING CODE 4410-09-P


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