“It demonstrates the government’s efforts to criminalize good faith actions relating to the manufacturing and distribution of controlled substances. There was never any attempt by Miami-Luken or its employees to violate government laws or regulations.”
The same week the felony charges were filed against Miami-Luken and former president Anthony Rattini and compliance officer James Barclay, the U.S. Drug Enforcement Administration publicly shared detailed data on where opioid pills were shipped around the U.S., including which manufacturers made the pills and which distributors shipped them.
The data shows Miami-Luken was not close to the largest pharmaceutical distributor in the U.S. — it sold about 0.1 percent of oxycodone and hydrcodone pills in the U.S. from 2006 to 2012 while six larger competitors sold 75 percent of the opioids shipped during that timeframe.
Yet the case against Miami-Luken is a landmark case. It’s only the second pharmaceutical distributor in the country to face a felony criminal charge by the U.S. Department of Justice in relation to the opioid crisis.
The DOJ is accusing Miami-Luken, Barclay, Rattini, and two West Virginia pharmacists of conspiring to distribute controlled substances.
“The big takeaway is the fact that although you have degrees on the wall or the white jacket, or you’re running a business or you’re running boardrooms, it does not matter to us,” Mauricio Jimenez, DEA assistant special agent in charge, said. “If you are breaking the law, you’re hurting everyday Americans. We are going to come after you as long as the evidence takes us there.”
Multiple attempts were made to reach Rattini and Barclay.
Until recently, pharmaceutical distributors and manufacturers typically faced fines, not criminal charges, as penalties for violations.
But there’s concern in the public health world that when it comes to enforcement action against pharmaceutical companies, that even large fines can be seen as the cost of doing business, said Joshua Sharfstein, Johns Hopkins University vice dean for public health practice and community engagement.
“Companies may be willing to spend astronomical amounts of money on fines if they’re making even more astronomical amounts of money,” said Sharfstein, who is also an unpaid expert witness for the city of Baltimore in the national prescription opiate litigation. “So when it comes to enforcement, if there’s truly egregious and criminal behavior, the idea of criminal prosecution may be a more important trend than even an enormous fine.
Based on volume, Miami-Luken was the 39th largest opioid distributor between 2006 and 2012, according to data analyzed by the Washington Post. The 0.1 percent of oxycodone and hydrcodone pills sold in the U.S. by Miami-Luken from 2006 to 2012 equaled about 120 million pills, compared to McKesson Corp., the largest distributor in the country that sold 14 billion pills over that time frame
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As the lawsuits and criminal case proceeds, a lot of the damage from opioid addiction is already done, regardless of who is eventually found accountable.
“Its certainly too late for thousands of people who are dead,” Ohio Attorney General David Yost said. “There are an awful lot of lives that are never going to heal, who are never going to be able to be who they would have been.”
Westside Pharmacy shipments
The Miami-Luken indictment and reports by the U.S. Energy and Commerce Committee examined by the Dayton Daily News give a glimpse of the Springboro distributor’s activity in West Virginia and why Miami-Luken has come under federal scrutiny.
The Dayton Daily News found:
• The indictment claims that Miami-Luken set a pill threshold limit for Pharmacist Devonna Miller-West at Westside Pharmacy for 6,000 dosage units of oxycodone per month. But in March 2011, the company distributed 68,400 dosage units, or more than 11 times the limit. Miller-West is also facing a criminal charge as part of the same Miami-Luken case.
• The U.S. Energy and Commerce Committee in a 2018 report states Miami-Luken was aware that a large number of prescriptions for hydrocodone and oxycodone were paid for with cash at that Westside Pharmacy in Oceana, West Virginia, (population 1,394).
• On Oct. 22, 2015, Miami-Luken obtained Westside’s dispensing data for the previous month, which shows the pharmacy continued to fill opioid prescriptions by two doctors that the pharmacy had pledged in June to stop filling orders for.
One of those doctors was David Morgan, whose license was suspended in 2017. Morgan was responsible for 33 percent of the oxycodone prescriptions filled by Westside, according to a copy of a report by Miami-Luken’s former director of compliance and security that was provided to Congress.
Morgan’s office was in Virginia and was more than a two hour drive away from Westside, and about 72 patients a month were getting a prescription from Morgan and having their script filled by Westside, the Miami-Luken report stated.
• Following the October 2015 review of the pharmacy’s dispensing information and determination that it had been lied to, Miami-Luken did not terminate or restrict Westside’s ability to buy opioids, the Congressional committee’s report stated.
MORE: Did drug distributors contribute to opioid crisis? Yes, says local exec.
Instead, Miami-Luken’s director of compliance and security (who is not named in the committee’s report) visited Westside on Nov. 4, 2015 and gave the pharmacy an overall positive review.
• On Nov. 23, 2015, Miami-Luken approved a 2,000 dosage unit increase for the pharmacy’s November oxycodone threshold, according to an email Miami-Luken provided the Congressional committee.
That same day, the DEA took the first step in an effort to take away Miami-Luken’s license to distribute.
Jimenez, DEA assistant special agent in charge, said the Miami-Luken criminal case was labor intensive and took years. He said there was extensive work that needed done both before and after the warrant and with medical businesses there are extra regulations that they need to be mindful of, such as HIPAA.
“We’re talking about hundreds of thousands, if not millions of documents that must be reviewed,” Jimenez said.
Public health crisis on trial
More than 2,000 civil lawsuits have been filed by local, state and tribal governments in the U.S. seeking to hold the prescription drug industry accountable in the wake of nearly 200,000 opioid overdose deaths and billions in damages.
Many of the prescription drug makers, distributors, pharmacies, and prescribers in the hot seat have pointed the finger at each other as well as at addicts and regulators. One of those companies being sued is Miami-Luken.
Distributors have noted that they didn’t research, advertise or prescribe opioids, but rather were filling others’ orders and were regulated the entire time by the DEA, which had the big picture data.
John Parker, spokesman for the Healthcare Distribution Alliance, a trade group representing distributors, previously said “the idea that distributors are responsible for the number of opioid prescriptions written defies common sense and lacks understanding of how the pharmaceutical supply chain actually works and is regulated.”
Data made public as part of these lawsuits, analyzed by the Washington Post, revealed more than 76 billion pain pills were shipped from 2006 to 2012 and showed a correlation between areas that received high levels of legal pain killers and areas with high opioid death rates.
Antonio Ciaccia, lobbyist with Ohio Pharmacist Association, said when looking at the flow of opioids, one of the problems that continues to exist today is that nobody gets paid unless they sell a pill, which creates an incentive for everyone to sell as many pills as they can as fast as they can. Instead, he said payments need to be reformed to pay for quality and good health outcomes.
“The entire design of the system from top to bottom is predicated on the filling of a prescription. If we don’t stop changing those incentives, these are the outcomes we should actually expect,” Ciaccia said.
Yost said the data, which his office reviewed before it was publicly shared, proves the state’s lawsuits against prescription opioid manufacturers and distributors.
“There was a flood of opiates coming into Ohio far beyond any rational basis. They could have been dropping this stuff in pallets out of airplanes,” Yost said.
Jimenez said cases similar to the Miami-Luken case aren’t going away, though he couldn’t give more details.
“How’s it going to happen? I can’t tell you. And who it is? I can’t tell you. But it there will be more,” Jimenez he said.
1962: Company founded by Robert Mastandrea as Miami Valley Wholesale Drug Co.
1971: Company acquired A.G. Luken Drug Co. and renamed Miami-Luken
1991: New warehouse and corporate headquarters built in Springboro
Feb. 2016: Miami-Luken settled for $2.5 million with West Virginia’s attorney general
Sept. 2017: Congressional committee opens investigation into Miami-Luken
May 2018: Chairman Joseph Mastandrea testifies before Congressional committee
June 2018: Miami-Luken starts running down its inventory
October 2018: Miami-Luken closes its doors
July 17, 2019: Federal grand jury charges Miami-Luken, two former employees, and two pharmacists