DEA Compliance Guide for Pharmacies

Pharmacies in the United States are Subject to Strict Oversight by the U.S. Drug Enforcement Administration (DEA). Here’s What Pharmacists and Pharmacy Owners Need to Know about DEA Compliance.

For pharmacists and pharmacy owners, federal compliance is a persistent concern. Among various other statutory and regulatory requirements, pharmacies in the United States are subject to the comprehensive prescription-drug-related provisions of the Controlled Substances Act (CSA). The U.S. Drug Enforcement Administration (DEA) is the primary federal agency tasked with enforcing the CSA, and the DEA aggressively enforces pharmacy’s legal obligations through audits, investigations, and prosecution.

Oberheiden, P.C.’s federal health care lawyers provide full-service DEA compliance representation based on a history of proven results in federal program billing and prescription drug fraud audits and investigations. Our lawyers and non-lawyer consultants serve as compliance counsel for pharmacies across the country, relying on centuries of combined experience as private health care lawyers, federal health care fraud prosecutors, and special agents with the DEA and other agencies. 

7 Key Aspects of DEA Compliance for Pharmacies

While the CSA is extraordinarily complex, pharmacies’ DEA compliance obligations can broadly be broken down into seven key areas (note: these areas address DEA compliance only, not billing compliance and the various other aspects of maintaining a federally-compliant pharmacy practice):

  • Prescription Drug Inventory
  • Packaging and Transfer of Prescription Drugs
  • Security to Prevent Loss or Theft
  • Pharmacy Record-Keeping Practices
  • Prescription Management and Fraud Monitoring
  • Drug Ordering
  • Drug Dispensing and Diversion Prevention

1. Prescription Drug Inventory

The CSA requires pharmacies to maintain a complete and accurate inventory of their prescription medications at all times, and pharmacies must maintain historical inventory records for a minimum of two years. During audits and inspections, pharmacies must be readily prepared to provide their inventory records to the DEA. 

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Gamal Abdel-Hafiz
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Former Supervisory Special Agent, FBI

2. Packaging, Transfer, and Disposal of Prescription Drugs

Packaging, transfer, and disposal of prescription drugs are all governed by provisions of the CSA and its enabling regulations as well. Similar to inventory records, pharmacies must maintain accurate documentation of their packaging, transfer, and disposal practices at all times, and engaging third-party service providers does not relieve pharmacies of their compliance obligations. 

3. Security to Prevent Loss or Theft

Pharmacies must adopt appropriate security measures to prevent loss or theft of prescription drugs; and, in the event of a loss or theft, pharmacies must promptly provide appropriate notice to the DEA. As a result, pharmacies’ security compliance efforts should focus on both (i) preventing loss or theft, and (ii) ensuring appropriate internal and external reporting. 

4. Pharmacy Record-keeping Practices

Thorough record-keeping is a core component of DEA compliance for pharmacies. In addition to inventory, transfer, and disposal records, pharmacies must adopt policies and procedures to ensure the systematic generation and storage of various other forms of documentation.

5. Prescription Management and Fraud Monitoring

Although physicians are responsible for determining when their patients need prescription medications, pharmacies play a role in preventing prescription drug fraud under federal law as well. Pharmacies must have policies and procedures in place to ensure the validity of all paper and electronic prescriptions, and they must proactively address any perceived instances of patient or provider fraud. 

6. Drug Ordering

When ordering prescription medications from drug manufacturers or through their program benefit managers (PBMs), pharmacies must use the appropriate form (DEA Form 222), and they must accurately complete the form while also generating appropriate internal documentation.

7. Drug Dispensing and Diversion Prevention

Pharmacies must appropriately label all dispensed medications according to DEA and U.S. Food and Drug Administration (FDA) requirements. When dispensing opioids and other potentially-addictive medications, pharmacies have an obligation to take appropriate measures to prevent diversion of these medications as well. 

Effective DEA Compliance Requires a Comprehensive and Custom-Tailored Approach

In order to establish and maintain compliance in each of these seven key areas, pharmacies must adopt a variety of compliance controls across all aspects of their business. Although all pharmacies have the same general obligations under the CSA, in order to avoid loss of DEA registration and the risk of civil or criminal prosecution as the result of a DEA audit or investigation, individual pharmacies must develop and implement custom-tailored compliance programs that reflect the unique aspects of their practices. 

When we represent pharmacies with respect to DEA compliance, our attorneys and consultants work closely with our clients to assess their needs and determine what revisions or additions to their existing compliance programs are required. We also work with new pharmacies to build ground-up compliance programs. In all cases, we seek to comprehensively address all pertinent issues in order to ensure that our clients will not be at risk in the event of a DEA inquiry.

Examples of Issues that Must Be Addressed to Establish DEA Compliance

Developing an effective DEA compliance program requires assessment of a variety of issues that are both general and highly-specific in nature. Even unintentional and seemingly-minor CSA violations can have severe consequence for pharmacies, pharmacists, and the pharmacy owners, so it is important that no issues go overlooked – no matter how minor it may seem in context. For example, some of the types of issues that must be addressed in order to establish and maintain DEA compliance include: 

  • Is your pharmacy meeting its “corresponding responsibility” obligations? While physicians have primary responsibility for determining the medical necessity of prescriptions, pharmacies have a “corresponding responsibility” to confirm medical necessity under the CSA. 
  • Do your drug inventories include all of the required information? From the date and time of daily inventories to required signatures, drug inventories must include various specific pieces of information in order to withstand DEA scrutiny. 
  • Are your pharmacy’s drug inventories appropriately segregated? Drug inventories for Schedule I and II controlled substances must be maintained separately from drug inventories for Schedule III, IV, and V controlled substances, and all drug inventories must be segregated from other pharmacy records for easy retrieval. 
  • Do all retail personnel have up-to-date self-certifications in compliance with the Combat Methamphetamine Epidemic Act of 2005 (CMEA self-certification)? All pharmacy personnel who are involved in the retail dispensing of prescription medications are required to complete a CMEA self-certification. 
  • Do all necessary pharmacy personnel have appropriate powers of attorney? Prior to placing orders for controlled-substance medications, pharmacy personnel who are not individually registered with the DEA must obtain individual powers of attorney signed by a DEA registrant.
  • Is your pharmacy compliant with the requirements of the Controlled Substance Ordering System (CSOS)? Orders placed through the CSOS must be electronically linked to drug shipments upon delivery, and all CSOS certificate holders are required to have a valid and executed subscriber agreement on file. 
  • Do you have adequate protocols for disposing of unused medications? Pharmacies have an obligation to ensure that all unused medications are delivered by authorized means to a reverse distributor’s registered location. 
  • Do you have adequate protocols for reporting security violations? Any substantial loss or theft of controlled-substance medications must be reported to the DEA within one business day. Substantial loss and theft reports must be submitted using DEA Form 106.
  • Are all prescriptions and prescription drug invoices readily available for DEA inspection? Even if your pharmacy stores copies of all prescriptions and prescription drug invoices as required, if these records are not readily available to be provided to the DEA upon request, then your pharmacy could be unnecessarily at risk for penalties in a DEA audit or investigation.
  • Is your pharmacy packaging and labeling all dispensed medications appropriately? Failure to appropriately package and label dispensed medications is an issue that raises red flags for the DEA as well. Even if your pharmacy is validly filling prescriptions, if all medications are not appropriately packaged and labeled, your pharmacy (and potentially you personally) could still face penalties under the CSA.

What Does It Take to Maintain (and Prove) DEA Compliance?

How can you address these types of issues in your pharmacy practice? Equally important, how can you prove to the DEA that your pharmacy is fully compliant with the CSA and all other applicable laws? 

As with most aspects of compliance, the key is to develop, implement, and enforce comprehensive and custom-tailored documentation. Not only will having appropriate documentation help your pharmacy’s personnel maintain compliance, but it will also help prove to the DEA that you have undertaken good-faith efforts to comply. DEA compliance is extremely burdensome, and mistakes happen. When they do, pharmacists and pharmacy owners need to be able to prove that they were unintentional in order to avoid facing criminal prosecution. Of course, the ultimate goal is to avoid compliance issues entirely so that any DEA inquiries can be resolved quickly and without any potential risk of liability.

Schedule an Initial DEA Compliance Consultation at Oberheiden, P.C.

Is your pharmacy DEA-compliant? Do you have concerns about the effectiveness of your pharmacy’s DEA compliance program? Could you be at risk for civil or criminal penalties in the event of a DEA audit or investigation? To speak with a member of Oberheiden, P.C.’s federal health care compliance team in confidence, call us at 214-469-9009 or request a free consultation online today.

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