Federal Register / Vol. 81, No. 23 / Thursday, February 4, 2016 / Notices 6045 

1Notwithstanding that Registrant failed to appear 

at the MBC hearing, the MBC’s findings of fact and 

conclusions of law are entitled preclusive effect in 

this proceeding. The MBC found that Registrant was 

properly served with the Accusation and, in fact, 

several days before the hearing telephoned the 

MBC’s counsel ‘‘and advised her that he was not 

going to appear.’’ GX 3, at 2. Thus, notwithstanding 

that he defaulted, Registrant had a full and fair 

opportunity to challenge the MBC’s allegations. See 

Jose G. Zavaleta, 78 FR 27431, 27434 (2013) 

(collecting cases holding that findings made in a 

proceeding against a party in default are entitled to 

preclusive effect if the party could have appeared 

and defended if he had wanted to); see also id. 

(quoting Gottlieb v. Kest, 141 Cal. App. 4th 110, 149 

(Cal. Ct. App. 2006) (‘‘A default judgment 

conclusively establishes, between the parties so far 

as subsequent proceedings on a different cause of 

action are concerned, the truth of all material 

allegations contained in the complaint in the first 

action, and every fact necessary to uphold the 

default judgment.’’) (int. quotations and citations 

omitted). 

the Drug Enforcement Administration 

(DEA), 28 CFR 0.100(b). Authority to 

exercise all necessary functions with 

respect to the promulgation and 

implementation of 21 CFR part 1301, 

incident to the registration of 

manufacturers, distributors, dispensers, 

importers, and exporters of controlled 

substances (other than final orders in 

connection with suspension, denial, or 

revocation of registration) has been 

redelegated to the Deputy Assistant 

Administrator of the DEA Office of 

Diversion Control (‘‘Deputy Assistant 

Administrator’’) pursuant to section 7 of 

28 CFR part 0, appendix to subpart R. 

In accordance with 21 CFR 

1301.33(a), this is notice that on 

December 3, 2015, Pharmacore, Inc., 

4180 Mendenhall Oaks Parkway, High 

Point, North Carolina 27265 applied to 

be registered as a bulk manufacturer of 

the following basic classes of controlled 

substances: 

Controlled substance Schedule 

Oxymorphone (9652) ................... II 

Noroxymorphone (9668) .............. II 

The company plans to manufacture 

the listed controlled substances as 

active pharmaceutical ingredients (APIs) 

for clinical trials. 

Dated: January 27, 2016. 

Louis J. Milione, 

Deputy Assistant Administrator. 

[FR Doc. 2016–02128 Filed 2–3–16; 8:45 am] 

BILLING CODE 4410–09–P 

DEPARTMENT OF JUSTICE 

Drug Enforcement Administration 

David W. Bailey, M.D.; Decision and 

Order 

On September 9, 2015, the Deputy 

Assistant Administrator, Office of 

Diversion Control, Drug Enforcement 

Administration (DEA), issued an Order 

to Show Cause to David W. Bailey, M.D. 

(Registrant), of Hesperia, California. The 

Show Cause order proposed the 

revocation of Registrant’s Certificate of 

Registration FB4421474, and the denial 

of any applications to renew or modify 

this registration or for any other 

registration on two grounds. GX 1, at 1. 

First, the Show Cause Order alleged 

on April 3, 2015, the Medical Board of 

California (MBC or Board) revoked his 

state medical license, and that therefore, 

Registrant is ‘‘without authority to 

handle controlled substances in 

California, the [S]tate in which [he is] 

registered with the DEA. Id. (citing 21 

U.S.C. 802(21), 823(f), and 824(a)(3)). 

Second, the Order alleged that 

Registrant’s registration ‘‘is inconsistent 

with the public interest’’ because he 

failed to ‘‘comply with applicable state 

and Federal law[s]’’ related to controlled 

substances. Id. at 2. 

With respect to the latter contention, 

the Show Cause Order alleged that in 

the MBC proceeding, the MBC 

Administrative Law Judge (ALJ) found 

that Registrant admitted to eighteen 

occasions on which he issued 

clonazepam prescriptions to his wife 

but had the drugs dispensed to himself 

for his ‘‘own abuse.’’ Id. at 2. The Show 

Cause Order also alleged that the MBC’s 

ALJ found that Registrant ‘‘started a 

treatment program for alcohol and 

clonazepam abuse but completed only 

five days of the thirty-day program,’’ 

and that ‘‘[a]n expert physician testified 

that [his] diagnosis included 

benzodiazepine dependence and that 

[he was] not currently undergoing any 

recovery. Id. The Order alleged these 

findings establish that Registrant 

violated 21 U.S.C. 844(a) and 843(a)(3), 

as well as various provisions of the 

California Business and Professions 

Code. Id. The Order thus alleged that 

the MBC ALJ’s findings prove that 

Registrant’s registration ‘‘is inconsistent 

with the public interest under 21 U.S.C. 

824(a)(4) and 823(f)(4).’’ Id. 

Finally, the Show Cause Order 

notified Registrant of his right to request 

a hearing on the allegations or to submit 

a written statement in lieu of a hearing, 

the procedure for electing either option, 

and the consequence for failing to elect 

either option. Id. at 2 (citing 21 CFR 

1301.43). On September 16, 2015, DEA 

Diversion Investigators (DIs) travelled to 

Registrant’s address and after verifying 

his identity, personally served him with 

the Show Cause Order. GX 5, at 2 

(Declaration of DI). 

On December 1, the Government filed 

its Request for Final Agency Action 

along with with various exhibits. In its 

Request, the Government states that 

since the date of service of the Show 

Cause Order, neither Registrant, ‘‘nor 

anyone representing him[,] has 

requested a hearing or sent any other 

correspondence to’’ the Agency. Request 

for Final Agency Action, at 9. 

Based on the Government’s 

submission, I find that 30 days have 

now passed since the date of service of 

the Show Cause Order, and neither 

Registrant, nor anyone purporting to 

represent him, has either requested a 

hearing on the allegations or submitted 

a written statement in lieu of a hearing. 

See 21 CFR 1301.43(a) and (c). 

Accordingly, I find that Registrant has 

waived his right to a hearing or to 

submit a written statement in lieu of 

hearing. Id. § 1301.43(c) and (d). I 

therefore issue this Decision and Final 

Order based on the Investigative Record 

submitted by the Government. Id. 

§ 1301.43(e). I make the following 

findings of fact. 

Findings 

Registrant is a physician authorized to 

dispense controlled substances in 

schedules II through V as a practitioner, 

at the registered address of LaSalle 

Medical Associates, 16455 Main St., 

Suite 1, Hesperia, California. GX 2. His 

registration is not due to expire until 

July 31, 2016. Id. 

On March 6, 2015, the MBC issued an 

order revoking Registrant’s Physician’s 

and Surgeon’s License to practice 

medicine in the State of California, 

effective April 3, 2015. GX 4. The MBC’s 

revocation was based on the decision of 

a state ALJ who found, based on clear 

and convincing evidence, that 

Registrant: (1) Is alcohol and 

benzodiazepine dependent, (2) used 

alcohol and controlled substances in a 

manner dangerous to himself and 

others, (3) prescribed a controlled 

substance to another with the intention 

of using that substance himself, (4) selfadministered a controlled substance that 

he had prescribed in the name of 

another, (5) violated the California 

Medical Practice Act, and 6) engaged in 

unprofessional conduct.1 GX 3, at 1. 

More specifically, the state ALJ found, 

by clear and convincing evidence, that 

Registrant: 

engaged in unprofessional conduct by 

violating state laws related to the 

prescription and use of Klonopin as follows: 

[he] repeatedly issued prescriptions for 

Klonopin in [his wife’s] name with the intent 

of self-administering the Klonopin obtained 

from the prescriptions; he engaged in fraud 

and deceit in order to obtain Klonopin; he 

provided a false name to obtain Klonopin; he 

repeatedly used Klonopin in violation of the 


asabaliauskas on DSK5VPTVN1PROD with NOTICES
6046 Federal Register / Vol. 81, No. 23 / Thursday, February 4, 2016 / Notices 

2As for Factor One, while the State has not made 

a recommendation to the Agency, the State has 

revoked Respondent’s medical license and thus, he 

no longer meets the CSA’s requirement that he is 

authorized to dispense controlled substances in the 

State where he is registered. 

As for Factor Three, the record contains no 

evidence that Registrant has been convicted of an 

offense related to the manufacture, distribution or 

dispensing of controlled substances. 

As for Factor Five, even though the evidence 

shows that Respondent engaged in the self-abuse of 

controlled substances, the Government did not set 

forth any argument that Respondent’s conduct is 

also actionable under this Factor. Thus, I make no 

findings under this Factor. 

law; and he repeatedly used and possessed 

Klonopin that was not obtained with a 

legitimate prescription. 

Id. at 19 (citing Cal. Bus. & Prof. Code sec. 

2238(a)). 

The state ALJ also found that 

Registrant ‘‘intentionally created 

medical records—prescriptions to [his 

wife] for Klonopin—that were false 

because he intended to use the 

Klonopin obtained from the prescription 

for himself.’’ Id. (citing Cal. Bus. & Prof. 

Code § 2262). The state ALJ further 

found that Registrant violated the 

California Medical Practice Act when he 

‘‘used dangerous drugs in a manner that 

was dangerous to himself, violated state 

laws related to dangerous drugs and 

controlled substances, knowingly made 

false representation of fact, and created 

false medical records with a fraudulent 

intent.’’ Id. (citing Bus. & Prof. Code sec. 

2234). 

The ALJ then concluded that Registrant: 

suffers from alcohol dependence and 

benzodiazepine dependence, and his 

substance abuse presents a substantial risk of 

harm to himself, patients and the public. [H]e 

does not appear to be able or willing to 

become abstinent of alcohol despite his 

treatment with psychiatrists and 

psychologists and despite his brief 

participation in substance abuse programs. 

Id. at 20. The state ALJ thus concluded 

that ‘‘[u]nder all the circumstances, the 

outright revocation of respondent’s 

certificate is the only disciplinary 

option available at this time that will 

protect the public.’’ Id. 

On March 6, 2015, the MBC adopted 

the proposed decision, and on April 3, 

2015, Registrant’s Physician’s and 

Surgeon’s Certificate was revoked. GX 4. 

According to the online records of the 

MBC, Registrant’s license remains 

revoked. See also www.breeze.ca.gov. 

Discussion 

The Loss of State Authority Ground 

Pursuant to 21 U.S.C. 824(a)(3), the 

Attorney General is authorized to 

suspend or revoke a registration issued 

under section 823, ‘‘upon a finding that 

the Registrant . . . has had his State 

license . . . suspended [or] revoked .

. . by competent State authority and is 

no longer authorized by State law to 

engage in the . . . dispensing of 

controlled substances.’’ Moreover, DEA 

has held repeatedly 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, 76 FR 71371 (2011), 

pet. for rev. denied, 481 Fed Appx. 826 

(4th Cir. 2012). 

This rule derives from the text of two 

provisions of the CSA. First, Congress 

defined ‘‘the term ‘practitioner’ [to] 

mean[] a . . . physician . . . 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 Act, 

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 medicine. See, 

e.g., Calvin Ramsey, 76 FR 20034, 20036 

(2011); Sheran Arden Yeates, M.D., 71 

FR 39130, 39131 (2006); Dominick A. 

Ricci, 58 FR 51104, 51105 (1993); Bobby 

Watts, 53 FR 11919, 11920 (1988). See 

also Hooper v. Holder, 481 Fed. Appx. 

at 828. 

Based on the MBC’s revocation of his 

medical license, I find that Registrant 

lacks authority to dispense controlled 

substances in California, the State in 

which he holds his DEA registration. 

According, I will order that Registrant’s 

registration be revoked and that any 

pending applications be denied. 21 

U.S.C. 824(a)(3). 

The Public Interest Ground 

Section 304(a) of the Controlled 

Substances Act (CSA) also provides that 

a registration to ‘‘dispense a controlled 

substance . . . may be suspended or 

revoked by the Attorney General upon 

a finding that the registrant . . . has 

committed such acts as would render 

his registration under section 823 of this 

title inconsistent with the public 

interest as determined under such 

section.’’ 21 U.S.C. 824(a)(4). With 

respect to a practitioner, the Act 

requires the consideration of the 

following factors in making the public 

interest determination: 

(1) The recommendation of the appropriate 

State licensing board or professional 

disciplinary authority. 

(2) The applicant’s experience in 

dispensing . . . controlled substances. 

(3) The applicant’s conviction record under 

Federal or State laws relating to the 

manufacture, distribution, or dispensing of 

controlled substances. 

(4) Compliance with applicable State, 

Federal, or local laws relating to controlled 

substances. 

(5) Such other conduct which may threaten 

the public health and safety. 

Id. § 823(f). 

‘‘These factors are. . . considered in 

the disjunctive.’’ Robert A. Leslie, M.D., 

68 FR 15227, 15230 (2003). I ‘‘may rely 

on any one or a combination of factors, 

and may give each factor the weight [I] 

deem[] appropriate in determining 

whether a registration should be 

revoked.’’ Id.; see also Volkman v. DEA, 

567 F.3d 215, 222 (6th Cir. 2009). And 

while I must consider each factor, I 

‘‘need not make explicit findings as to 

each one and can ‘give each factor the 

weight [I] determine[] is appropriate.’ ’’ 

MacKay v. DEA, 664 F.3d 808, 816 (10th 

Cir. 2011) (quoting Volkman v. DEA, 

567 F.3d 215, 222 (6th Cir. 2009)); see 

also Hoxie v. DEA, 419 F.3d 477, 482 

(6th Cir. 2005)); see also Morall v. DEA, 

412 F.3d 165, 173–74 (D.C. Cir. 2005) 

(same). In this matter, I concluded that 

the evidence with respect to Factors 

Two and Four establishes that 

Registrant has committed acts which 

render his registration inconsistent with 

the public interest. 

The Government contends that the 

MBC ALJ’s findings of fact and 

conclusions of law establish that 

Registrant violated state and federal 

laws related to controlled substances.2 I 

agree that the State’s findings establish 

that Registrant committed several 

violations of state laws that are 

actionable under Factor Four. 

Specifically, Respondent violated Cal. 

Bus. & Prof. Code sec. 2239(a), which 

provides that ‘‘[t]he use or prescribing 

for or administering to himself. . . of 

any controlled substance; or the use of 

any of the dangerous drugs. . . to the 

extent, or in such a manner as to be 

dangerous or injurious to the licensee, 

or to any other persons or to the public, 

or to the extent that such use impairs 

the ability of the licensee to practice 


asabaliauskas on DSK5VPTVN1PROD with NOTICES
Federal Register / Vol. 81, No. 23 / Thursday, February 4, 2016 / Notices 6047 

1The Show Cause Order also notified Respondent 

of his right to request a hearing on the allegations 

or to submit a written statement in lieu of a hearing, 

the procedure for electing either option, and the 

consequence of failing to elect either option. GX 1, 

at 2 (citing 21 CFR 1301.43). 

2Pursuant to an earlier Board Order, Respondent 

did not, at the time of the prior Agency proceeding, 

possess state authority ‘‘to prescribe narcotics, 

including but not limited to, all opioid analgesics, 

including buprenorphine and all synthetic opioid 

analgesics.’’ Id. at 62676. 

medicine safely. . . constitutes 

unprofessional conduct.’’ See also Cal. 

Bus. & Prof. Code sec. 2238 (‘‘A 

violation of any federal statute or 

regulation, or any of the statutes or 

regulations of this state regulating 

dangerous drugs or controlled 

substances constitutes unprofessional 

conduct.’’). 

I further conclude that the MBC’s 

findings establish that Registrant 

violated the CSA when he issued 

fraudulent prescriptions in his wife’s 

name for Klonopin (clonazepam), a 

schedule IV controlled substance, which 

he then used and abused. See 21 U.S.C. 

843(a)(3) (‘‘It shall be unlawful for any 

person knowingly or intentionally. . . 

to acquire or obtain possession of a 

controlled substance by 

misrepresentation, fraud, forgery, 

deception or subterfuge.’’); see also id. 

sec. 844(a) (‘‘It shall be unlawful for any 

person knowingly or intentionally to 

possess a controlled substance unless 

such substance was obtained directly, or 

pursuant to a valid prescription or 

order, from a practitioner, while acting 

in the course of his professional 

practice.’’); 21 CFR 1306.04(a) (‘‘A 

prescription for a controlled 

substance. . . must be issued for a 

legitimate medical purpose by an 

individual practitioner acting in the 

usual course of his professional 

practice.’’). Not only is this conduct 

actionable under Factor Four, it is also 

relevant in assessing Registrant’s 

experience in dispensing controlled 

substances (Factor Two). 

Accordingly, I find that the evidence 

establishes Registrant ‘‘has committed 

such acts as would render his 

registration. . . inconsistent with the 

public interest.’’ See 21 U.S.C. 824(a)(4). 

Because Registrant failed to respond in 

any manner to the Show Cause Order, 

I will order that his registration be 

revoked and that any pending 

application be denied. 

Order 

Pursuant to the authority vested in me 

by 21 U.S.C. 823(f) and 824(a), as well 

as 28 CFR 0.100(b), I order that DEA 

Certificate of Registration FB4421474, 

issued to David W. Bailey, M.D., be, and 

it hereby is, revoked. I further order that 

any pending application of David W. 

Bailey, M.D., to renew or modify his 

registration, be, and it hereby is, denied. 

This Order is effective March 7, 2016. 

Dated: January 18, 2016. 

Chuck Rosenberg, 

Acting Administrator. 

[FR Doc. 2016–02127 Filed 2–3–16; 8:45 am] 

BILLING CODE 4410–09–P 

DEPARTMENT OF JUSTICE 

Drug Enforcement Administration 

Kenneth H. Bull, M.D.; Decision and 

Order 

On August 21, 2015, the Deputy 

Assistant Administrator, Office of 

Diversion Control, Drug Enforcement 

Administration (DEA), issued an Order 

to Show Cause to Kenneth H. Bull, M.D. 

(Respondent), of Albuquerque, New 

Mexico. GX 1, at 1. The Show Cause 

Order proposed the revocation of 

Respondent’s DEA Certificate of 

Registration AB5662552, and the denial 

of any applications for renewal or 

modification of the registration, as well 

as for any other registration, on two 

grounds: (1) That he lacks authority to 

handle controlled substances in New 

Mexico, the State in which he is 

registered with DEA, and (2) his 

‘‘registration would be inconsistent with 

the public interest.’’ Id. (citing 21 U.S.C. 

823(f), 824(a)(3) and (4)). 

The Show Cause Order alleged that 

Respondent is registered as a 

practitioner in schedules IIN, IIIN, IV 

and V, at the registered address of 3500 

Comanche Blvd., Building Suite 6, 

Albuquerque, New Mexico. Id. The 

Order also alleged that his registration 

does not expire until July 31, 2017. Id. 

As grounds for the proposed action, 

the Show Cause Order alleged that 

effective June 30, 2014, the New Mexico 

Medical Board (Board) issued a Decision 

and Order which revoked Respondent’s 

medical license, thus rendering him 

without authority ‘‘to order, dispense, 

prescribe or administer any controlled 

substances’’ in New Mexico, the State in 

which he holds his registration. Id. 

Continuing, the Order asserted that ‘‘the 

DEA must revoke [Respondent’s] 

registration based upon [his] lack of 

authority to handle controlled 

substances in’’ New Mexico. Id. (citing 

21 U.S.C. 802(21), 823(f), and 824(a)(3)). 

As further ground, the Government 

alleged that Respondent’s ‘‘registration 

is inconsistent with the public interest 

because [he] did not comply with 

applicable Federal law related to 

controlled substances, in violation of 21 

U.S.C. 824(a)(4) and 823(f)(4).’’ Id. The 

Government based this allegation on the 

factual findings and legal conclusions of 

a prior agency proceeding, which 

suspended his DEA registration for six 

months and restricted his registration to 

non-narcotic controlled substances. Id. 

at 2 (citing Kenneth Harold Bull, M.D., 

78 FR 62666 (2013)). The Show Cause 

Order then set forth several of the 2013 

Order’s findings of the violations found 

during a November 2009 administrative 

inspection.1 Id. 

The Show Cause Order was served on 

Respondent by registered mail sent to 

his registered location; according to the 

Government, the return receipt card 

showed that the mailing was received 

on September 16, 2015. Request for 

Final Agency Action (RFAA), at 2; GX 

7. Thereafter, on September 22, 2015, 

Respondent, through his attorney, filed 

a written response to the Show Cause 

Order. GX 8. 

Therein, Respondent expressly 

waived his right to a hearing but 

submitted a written statement for my 

consideration. GX 8, at 1 (citing 21 CFR 

1301.43(c)). Thereafter, the Government 

submitted a Request for Final Agency 

Action with supporting documents; in 

its submission, the Government also 

included Respondent’s written 

statement. 

Based on Respondent’s submission, I 

find that he has waived his right to a 

hearing on the allegations of the Show 

Cause Order. 21 CFR 1301.43(c). 

However, I will consider Respondent’s 

statement along with the evidence 

submitted by the Government in this 

matter. I make the following findings of 

fact. 

Findings 

Respondent, who is a psychiatrist in 

the State of New Mexico, is the holder 

of DEA Certificate of Registration 

AB5662552, pursuant to which he is 

currently authorized to dispense 

controlled substances in Schedules IIN, 

IIIN, IV and V; his registration does not 

expire until July 31, 2017. GX 2, at 1. 

Respondent was previously authorized 

to dispense controlled substances in 

Schedules II through V, as well to 

dispense buprenorphine as a DATAWaiver physician. See Bull, 78 FR at 

62669. However, on September 22, 

2013, the then-Administrator issued a 

Decision and Order which suspended 

Respondent’s registration for six 

months; the Order also revoked 

Respondent’s DATA-Waiver 

Identification Number and restricted his 

dispensing authority to non-narcotic 

controlled substances only.2 Id. at 62676; 

GX 2. 


asabaliauskas on DSK5VPTVN1PROD with NOTICES