[Federal Register Volume 61, Number 85 (Wednesday, May 1, 1996)]
[Notices]
[Pages 19321-19324]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-10760]



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DEPARTMENT OF JUSTICE

Drug Enforcement Administration
[Docket No. 94-65]


East Towne Save Rite Pharmacy; Suspension of Registration

    On May 26, 1994, the Deputy Assistant Administrator, Office of 
Diversion Control, Drug Enforcement Administration (DEA), issued an 
Order to Show Cause to East Towne Save Rite Pharmacy, (Respondent) of 
Bremerton, Washington, notifying it of an opportunity to show cause as 
to why DEA should not revoke its DEA Certificate of Registration, 
BE1740770, as a retail pharmacy, and deny any pending application for 
modification of registration or change of address. The general reason 
stated for the proposed action was that the Respondent's owner had been 
convicted of a felony related to controlled substances warranting 
consideration under 21 U.S.C. 824(a)(2), and that the Respondent's 
continued registration would be inconsistent with the public interest 
as that term is used in 21 U.S.C. 824(a)(4) and 823(f).
    On May 31, 1994, the Respondent, through counsel, filed a timely 
request for a hearing, and following prehearing procedures, a hearing 
was held in Seattle, Washington, on July 26 through July 27, 1995, 
before Administrative Law Judge Paul A. Tenney. At the hearing, both 
parties called witnesses to testify and introduced documentary 
evidence, and after the hearing, counsel for both sides submitted 
proposed findings of fact, conclusions of law and argument. On October 
20, 1995, Judge Tenney issued his Findings of Fact, Conclusions of Law, 
and Recommended Ruling, recommending that the Respondent's DEA 
Certificate of Registration be suspended for a period of six months. 
After the six-month suspension, should be Respondent apply for a 
modification of its DEA registration to change the address of the 
pharmacy, then Judge Tenney recommended that the modification be 
granted. On November 7, 1995, the Respondent filed exceptions to Judge 
Tenney's opinion, and on November 9, 1995, the Government filed a 
response to the Respondent's exceptions. On November 28, 1995, Judge 
Tenney transmitted the record of these proceedings and the parties' 
exceptions to the Deputy Administrator.
    The Deputy Administrator has considered the record in its entirety, 
and pursuant to 21 CFR 1316.67, hereby issues his final order based 
upon findings of fact and conclusions of law as hereinafter set forth. 
The Deputy Administrator adopts, in full, the Findings of Fact, 
Conclusions of Law, and Recommend Ruling of the Administrative Law 
Judge, and his adoption is in no manner diminished by any recitation of 
facts, issues and conclusions herein, or of any failure to mention a 
matter of fact or law.
    The Deputy Administrator finds that on September 12, 1991, the 
Respondent was issued DEA Certificate of Registration BE1740770, as a 
retail pharmacy located on Wheaton Way in Bremerton, Washington. On 
March 2, 1991, Mr. Patrick Swanson, (Owner) owner and pharmacist for 
the Respondent pharmacy, was arrested for possession of a controlled 
substance, methylphenidate. The prescription bottle containing the 
substance was discovered during an investigatory stop of the Owner's 
vehicle. The Owner was convicted of possession of a controlled 
substance on June 24, 1992, and was sentenced to two days of 
confinement and to the performance of 204 hours of community service. 
He was also placed on a program of community supervision for a period 
of one year.
    In September of 1991, upon notification of the Owner's arrest, 
investigators from the Washington State Board of Pharmacy (Pharmacy 
Board) conducted an audit at the Respondent pharmacy for Schedule II 
controlled substances, specifically dexedrine and methylphenidate. They 
discovered that there was a 37.2% combined shortage for those two 
controlled substances, as well as missing DEA 222 order forms for 
Schedule I and II controlled substances. The Owner had stated to the 
investigators that his pharmacy had been burglarized and that he had 
reported the burglary to the local police. However, the Owner admitted 
at his hearing before the Pharmacy Board and before Judge Tenney that a 
portion of the discovered shortage was due to his own diversion of the 
controlled substances.
    On December 9, 1991, the Pharmacy Board issued a Statement of 
Charges against the Owner. These charges were primarily based upon the 
Owner's unlawful possession of a controlled substance and the shortage 
of dexetrine and methylphenidate at the Respondent pharmacy. On March 
24, 1992, the Pharmacy Board imposed an Order of

[[Page 19322]]

Continuance and Imposing Summary Restrictions, prohibiting the Owner 
from using legend drugs and controlled substances unless legitimately 
prescribed, requiring the Owner's physician to report to the Pharmacy 
Board all prescriptions issued to the Owner, requiring the Owner to 
submit to drug urine testing twice a week, and requiring the Owner to 
undergo an evaluation by a Board-approved psychiatrist with experience 
in substance abuse.
    On May 18, 1992, the Owner underwent an evaluation by Dr. Maurice 
Lustgarten, a Pharmacy Board-approved psychiatrist. Dr. Lustgarten 
wrote a report for the Pharmacy Board, noting that ``[a]fter spending 
two hours in historical review and evaluation of [the Owner], I have 
determined that he is sincerely motivated to discontinue all drug 
usage.'' Further, Dr. Lustgarten concluded that ``I'm satisfied that 
under the present circumstances and the apparent honesty of [the 
Owner], he is succeeding in his battle with drugs and that he can put 
this behind him and have a successful career in pharmacy.''
    On March 18, 1993, the Pharmacy Board issued its Final Order, 
suspending the Owner's pharmacist license for five years, but staying 
the suspension on the condition that he comply with certain terms of 
probation. Specifically, the Order required, among other things, that 
the Owner (1) abstain from alcohol and the non-therapeutic use of 
legend drugs and controlled substances; (2) report any prescriptions 
for controlled substances issued to him for therapeutic purposes; (3) 
participate in an approved chemical dependence treatment plan for a 
minimum of three years; (4) submit to random drug testing twice a week; 
(5) attend three AA or other support group meetings per week, and 
submit to the Pharmacy Board signed attendance records each month; and 
(6) ensure that all required reports be submitted to the Pharmacy Board 
in a timely manner.
    However, in response to a second Statement of Charges and a hearing 
held on November 18, 1993, the Pharmacy Board issued a second Final 
Order dated January 19, 1994, finding that the Owner had violated 
certain terms of his probation. Specifically, the Owner had informed 
the Pharmacy board that (1) he was taking prescriptions for several 
legend drugs, but he failed to submit reports from physicians verifying 
those prescriptions; (2) he had taken Toradol, a legend drug, that had 
been prescribed for his wife: (3) he had submitted quarterly reports of 
his compliance with the conditions of his probation late, for the 
subject reports were due on the first day of April and July 1993, but 
had been submitted on August 16, 1993; (4) he had untimely submitted 
the signed attendance records for his support group meeting; (5) he had 
failed to timely name a responsible pharmacist to operate the 
Respondent pharmacy while his pharmacist license was suspended; and (6) 
he had allowed an unlicensed person, his assistant, to take charge of 
the pharmacy. As a result, the Pharmacy board ordered the Owner to be 
placed on another five-year probationary period beginning from the date 
of the order, January 19, 1994. The probationary conditions were many 
of the same conditions found in the first final order, plus the Owner 
was to undergo another substance abuse evaluation. Dr. Lustgarten 
reevaluated the Owner on March 18, 1994, and in his report he concluded 
that the Owner was benefiting from his counselling sessions with Dr. 
Wolborsky, and that he was satisfied that the Owner was complying with 
the Pharmacy Board's ``expectations in performance of his profession.''
    On April 6, 1994, the Owner was arrested for Driving Under the 
Influence, and he admitted to having three alcoholic drinks with 
friends, as well as to having taken prescription Soma tablets. The 
Owner consented to a breathalyzer test, which showed his blood alcohol 
content to be 0.05, well below the presumptive level of intoxication in 
the State of Washington, which is 0.10 or higher. However, as noted by 
Judge Tenney, in Washington, ``a person can be guilty of driving under 
the influence if the person drives while under the combined influence 
of or affected by intoxicating liquor and any drug. Wash. Rev. Code 
46.61.502 (1994).'' The Owner was not prosecuted on this charge, 
however, but entered into a deferred prosecution agreement in which he 
was to attend a one year program for alcohol education.
    On May 9, 1995, the Pharmacy board filed a third Statement of 
Charges against the Owner, alleging that (1) he had failed to timely 
submit signed attendance records of his support group meetings for the 
months of July and August 1994; (2) he had failed to attend the 
required amount of AA meetings during the second week in August 1994; 
and (3) that he had failed to submit to urinalysis testing on April 29 
and May 13, 1994. The Owner answered these allegations, admitting that 
he had submitted the July attendance record late, and that he had 
missed the AA meetings during the second week in August 1994, because 
he was on vacation with his family. Upon returning from vacation, the 
Owner notified Mr. Bob Johnson, his compliance officer with the 
Washington Recovery Assistance Program for Pharmacy, of his failure to 
attend the meetings, and how, after considerable effort, he was unable 
to locate any such meetings at this vacation site. Subsequently, the 
Owner's regular AA group gave him a toll free number to call, should 
this problem arise in the future. However, during the vacation week, 
the Owner had submitted to his bi-weekly urine testing, having arranged 
the testing in advance with a local hospital. Finally, the Owner 
claimed that the sole reason for missing the urine testing on the dates 
in April and May of 1994, was that the testing center he routinely 
utilized was either closed or there was no male observer available. 
This Statement of Charges was awaiting disposition by the Pharmacy 
board as of the time of Judge Tenney's decision and the closing of the 
record.
    The Respondent's DEA Certificate of Registration was for a location 
on Wheaton Way in Bremerton, Washington. However, following the 
retirement of the Owner's father, the Owner moved his pharmacy from the 
Wheaton Way address to an address on Bertha Avenue in Bremerton, 
Washington. Prior to the move, the Owner sought permission from the 
Pharmacy Board, and he received an application packet from the Pharmacy 
Board which had included an application for a DEA registration for the 
new address. The Owner filed an application with the Pharmacy Board, 
and after a hearing was held on the matter, the Pharmacy Board granted 
the Owner permission to relocate the pharmacy. On April 14, 1994, the 
Owner sent a letter to the DEA office in Seattle, Washington, notifying 
the DEA of his intent to move the pharmacy and to rename it. However, 
the Owner failed to obtain the DEA's approval prior to relocating the 
Respondent pharmacy, as required. Accordingly, in April of 1994, DEA 
diversion investigators entered the Bertha Avenue location and seized 
the controlled substance located at that unregistered site. Since that 
time, the Owner has remained unauthorized to handle controlled 
substances at the Bertha Avenue location.
    The Owner testified that he thought he had followed all appropriate 
procedures to relocate his pharmacy, and that he believed that a new 
DEA registration for the Bertha Avenue address would follow the 
pharmacy upon notification of the move to the DEA. The Owner testified 
that he had understood that it did not matter whether the notification 
letter preceded or followed the actual relocation, and

[[Page 19323]]

that he had relied upon information he had receive after he had placed 
a phone call to the Seattle DEA office during the winter of 1994. 
However, noting that the Owner may have misunderstood the modification 
regulations that were conveyed to him, Judge Tenney found that the 
diversion investigators at the DEA Seattle Office were all aware that 
modification requests must be submitted in writing to the DEA before 
any relocation. Once the modification was approved, then the pharmacy 
would have been issued a new DEA registration number at the new 
address. Only after receiving the new DEA registration number would the 
pharmacy's pharmacists be authorized to handle controlled substances at 
the new location. However, Judge Tenney also found that the Owner had 
``made a good faith attempt to comply with the regulations of the 
agencies governing the relocation of pharmacies. * * * He did not make 
this more surreptitiously, or without consideration of the regulations 
governing such changes.''
    The Owner also testified that he had sought help for his substance 
abuse problem in May of 1989 with Dr. Barry Wolborsky, a licensed 
clinical psychologist who specializes in chemical dependency. Since 
that time, the Owner has been seeing Dr. Wolborsky twice a month. 
Although the Owner admits that when he first began his treatment he was 
unable to stop abusing controlled substances, he also testified that he 
has not abused controlled substances since January 30, 1991. Also, 
although Dr. Wolborsky has suggested that the Owner abstain from 
drinking alcohol, the Owner testified that he had remained a social 
drinker until his arrest for driving while intoxicated in April of 
1994. Since that date, however, the Owner testified that he has 
abstained from drinking alcohol.
    Dr. Wolborsky testified before Judge Tenney, concerning his 
treatment of the owner. He concluded that he believed that the Owner's 
prognosis for continued recovery was excellent.
    Under 21 U.S.C. 824(a)(2), the Deputy administrator may suspend or 
revoke a DEA registration and deny any pending modifications to the 
registration based upon a finding that the registrant has been 
convicted of a felony relating to controlled substances. Here, the 
Owner of the Respondent and its pharmacist was convicted of the felony 
of possession of a controlled substance in June of 1992.
    Additionally, pursuant to 21 U.S.C. 824(a)(4), the deputy 
administrator may revoke or suspend a DEA Certificate of Registration 
and deny any pending application for such registration, if he 
determines that granting the registration would be inconsistent with 
the public interest. Section 823(f) requires that the following factors 
be considered in determining the ``public interest:''
    (1) The recommendation of the appropriate State licensing board or 
professional disciplinary authority.
    (2) The applicant's experience in dispensing, or conducting 
research with respect to 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 or 
safety.
    These factors are to be considered in the disjunctive; the Deputy 
Administrator may rely on any one or a combination of factors and may 
give each factor the weight he deems appropriate in assessing the 
``public interest'' and in determining whether a registration should be 
revoked or an application for registration denied. See Henry J. 
Schwarz, Jr., M.C., Docket No. 88-42, 54 FR 16422 (1989).
    In this case, factors one, three, four, and five of Section 823 are 
relevant in determining whether the Respondent's registration would be 
inconsistent with the public interest. As to factor one, 
``recommendation of the appropriate State licensing board, * * *'' the 
Pharmacy Board has not expressly made a recommendation in this case. 
However, the Pharmacy Board has taken adverse action against the 
Owner's pharmacist license, by placing him on a five-year probationary 
period and by requiring him to comply with comprehensive probation 
conditions. Also, Judge Tenney noted that the Owner had engaged in a 
pattern of violations of the Pharmacy Board's conditions of probation, 
to include untimely submission of required reports, violation of the 
prohibition on the use of alcohol, and failure to undergo required 
urine testing. Therefore, the Deputy Administrator agrees with Judge 
Tenney's finding that ``the Board is properly concerned with his 
pattern of non-compliance to its conditions of probation. However, the 
Board has concluded that [the Owner] should be placed on probation for 
an extended period of time as opposed to suspension of his license.''
    As to factor three, the Respondent's ``conviction record under 
Federal or State laws relating to * * * controlled substances,'' and 
factor four, ``[c]compliance with applicable State, Federal, or local 
laws relating to controlled substances,'' it is uncontroverted that in 
June of 1992, the Owner was convicted of illegal possession of a 
controlled substance. The Owner has also violated state law and DEA 
regulations regarding the handling of controlled substances, evidenced 
by the audit results which revealed a 37.2% shortage of Schedule II 
controlled substances, some of which the Owner admitted he had diverted 
for his personal use.
    Further, the Owner also violated DEA regulations when he relocated 
the Respondent pharmacy without first receiving the required DEA 
approval. Judge Tenney noted that ``While I have found that the 
incompliance was inadvertent, it nonetheless is consistent with [the 
Owner's] pattern of non-compliance with state and DEA regulations.''
    As to factor five, ``[s]uch other conduct which may threaten the 
public health and safety,'' the Owner has admitted that he had abused 
controlled substances for many years, and that it was not until January 
of 1991 that he was able to control his substance-abuse problem. 
However, the Deputy Administrator agrees with Judge Tenney's 
conclusion, that the record supports the Owner's assertion of 
abstinence, for all ``of his urinalysis results for the past three 
years have been negative.''
    Further, the Deputy Administrator agrees with Judge Tenney's 
finding that the Owner's ``conviction relating to controlled 
substances, the shortage of controlled substances discovered during the 
audit of the Respondent pharmacy, [the Owner's] arrest for Driving 
Under the Influence in April 1994, and the violations of the terms of 
his probation justify the Government's proposed revocation of 
Responsent's DEA registration. * * * The Government has also proven 
violations of DEA regulations, dealing with relocating the Respondent 
pharmacy without DEA approval and the submission of all relevant DEA 
222 forms.''
    However, the Owner has also presented considerable evidence of 
rehabilitation. The record demonstrated the inadvertent nature of his 
administrative errors during his probation, such as the untimely 
submission of reports and his failure to provide the required paperwork 
to the DEA prior to the relocation of the Respondent pharmacy. Further, 
Dr. Lustgarten has concluded that the Owner was honest and sincere in 
his desire to end his substance abuse, and Dr. Wolborsky testified that 
the Owner's prognosis for continued recovery was excellent. The Owner 
has provided over

[[Page 19324]]

three years of negative urinalysis test results, demonstrating his 
successful efforts of recovery since 1992. He also continues to attend 
three AA meetings a week and counseling sessions with Dr. Wolborsky.
    In light of the above, the Deputy Administrator agrees with Judge 
Tenney's conclusion that ``[u]nder these circumstances, revocation 
would be too harsh a sanction. * * * While it is true that [the Owner] 
has violated some of the Board's probationary conditions, these 
violations were relatively minor and do not outweigh in balance his 
continuing recovery from his addiction.''
    Therefore, the Deputy Administrator adopts Judge Tenney's 
recommendation and orders the Respondent's DEA Certificate of 
Registration, BE1740770, suspended for a period of six months. However, 
the Deputy Administrator also takes note of the Respondent's exception 
to the start date of this suspension, for the Owner has been without 
authorization to handle controlled substances at the Bertha Avenue 
location since his relocation in 1994. Such lack of authorization 
resulted in a de factor suspension dating from April of 1994. Given the 
totality of the circumstances in this case, the Deputy Administrator 
has determined that the suspension of the Respondent's registration 
should be given an effective date of October 20, 1995, the date Judge 
Tenney issued his opinion with which the Deputy Administrator totally 
concurs. Therefore, on or after April 20, 1996, the Respondent may 
apply for a modification of its DEA registration to change the address 
of the pharmacy, and if the Owner's circumstances remain consistent 
with the facts in this record, the modification may be given favorable 
consideration.
    Accordingly, the Deputy Administrator of the Drug Enforcement 
Administration, pursuant to the authority vested in him by 21 U.S.C. 
823, and 28 CFR 0.100(b) and 0.104, hereby orders that the DEA 
Certificate of Registration, BE1740770, belonging to East Towne Save 
Rite Pharmacy, be, and it hereby is, suspended for a period of six 
months, which period to have commenced on October 20, 1995, and to 
conclude on April 20, 1996. Furthermore, given the Respondent's 
interest in being authorized to apply for a modification of its DEA 
Certificate of Registration as soon as possible, the Deputy 
Administrator concludes that it is in the Respondent's interest, as 
well as in the public's interest, for this order to be effective upon 
publication in the Federal Register, and it is so ordered.

    Dated: April 24, 1996.
Stephen H. Greene,
Deputy Administrator.
[FR Doc. 96-10760 Filed 4-30-96; 8:45 am]
BILLING CODE 4410-09-M