The Issue Whether Petitioner should be granted a Retail Pharmacy Drug Wholesale Distribution Permit, pursuant to Subsection 499.01(2)(f), Florida Statutes (2009).1
Findings Of Fact Background Petitioner holds Florida Community Pharmacy License No. PH23699 (the “pharmacy license”), pursuant to Chapter 499, Florida Statutes. The establishment is located at 1507 Park Center Drive, Suite 1L, Orlando, Florida 32835 (“establishment”), where Petitioner’s records are stored. On or about July 29, 2009, Petitioner submitted the first portions an application to Respondent for a Retail Pharmacy Wholesaler Distributor Permit, pursuant to Subsection 499.01(2)(f), Florida Statutes (“application”). On September 16, 2009, Respondent's drug agents conducted an onsite inspection of the establishment (“inspection”) for purposes of assisting in Respondent’s determination of whether to issue the permit to Petitioner. On or about November 13, 2009, Respondent notified Petitioner that Respondent intended to deny the application (“notice”), and Petitioner filed a petition for administrative review, raising disputes of material fact (“petition”). Prescription Drug Inventory and Petition as a “Retail Pharmacy” To qualify as a retail pharmacy, Petitioner must have adequate inventory on hand that would be required by the general public for a variety of medical conditions. On the date of inspection, there was inadequate inventory on hand. There were only 18 commercially-available prescription drugs. Many of the drugs were injectables, which would only fill the needs of a very specific and limited patient population. At the time of inspection, Petitioner’s on-hand inventory of prescription drugs lacked any opiate painkillers and any drugs indicated for treatment or maintenance of (i) high blood cholesterol levels, (ii) systemic bacterial infections (oral antibiotics), (iii) osteoporosis, (iv) cough (syrups), (v) viral infections, (vi) depression, and (vii) asthma. These are some of the most commonly-required drugs in the pharmacological arsenal. Petitioner’s specialization in the area of compounded prescription drugs is evidenced by Petitioner’s prescription drug inventory and the nature of the prescriptions Petitioner filled in the months leading up to inspection. Most of Petitioner’s on-hand prescription drug inventory was composed of compounded prescription drugs or ingredients to be used in compounding prescription drugs. Less than eight percent of Petitioner's prescription drugs, or about 18 items, consisted of commercially-available prescription drugs in finished dosage forms. In the two-month period before September 29, 2009, Petitioner did not dispense a single dose of commercially- available, finished-form prescription drugs. All were specially-prepared or “compounded” products tailored to the specific needs of individual patients. Petitioner, as a result of an inability to meet the most basic and commonplace prescription drug needs of the general public, lacked adequate inventory required by the general public. Petitioner served a specific and limited patient population: i.e., those patients requiring specially-compounded prescription drugs and those rare patients whose needs could not be met by commercially-available products. Petitioner's explanation as to the reason for having only 18 commercially-available prescription drugs available at the time of inspection is not persuasive; Petitioner, therefore, was not a retail pharmacy. Life Specialty Pharmacy Medical Equipment and Supplies, Inc.: Petitioner’s Unauthorized Source for Prescription Drugs Life Specialty Pharmacy Medical Equipment and Supplies, Inc. (“Life Specialty”), a separate entity from Petitioner, is under common control with Petitioner. It has the same owners, principals, and pharmacy department manager. Life Specialty holds Community and Special Parenteral/Enteral Pharmacy License No. PH22346 for an establishment located at 1507 Park Center Drive, Suite 1L, Orlando, Florida 32835. It is not authorized under Florida law to purchase, receive, own, or distribute prescription drugs. Petitioner’s prescription drug inventory at the time of inspection included certain quantities of Sarapin, a prescription drug. Life Specialty acquired and received Sarapin from a Kmart pharmacy that is no longer in business. At the time Life Specialty acquired and received the Sarapin from Kmart pharmacy, that drug was readily available from Life Specialty’s prescription drug wholesale suppliers. Life Specialty later transferred the Sarapin to Petitioner. Life Specialty lacks any permit or authorization under Part I of the Florida Drug and Cosmetic Act, Chapter 499, Florida Statutes (Act), to engage in the wholesale distribution of prescription drugs. Petitioner, nevertheless, received prescription drugs from Life Specialty, and many of these drugs were in Petitioner’s prescription drug inventory at the time of inspection, including prescription drugs compounded by Life Specialty. Those drugs included: Sarapin Ketamine Hydrochorlide USP Progesterone Micro USP Chloral Hydrate (CIV), Crystal USP 100% 125gm Testosterone Propionate Micro USP Ketamine Hydrochloride USP 100% Powder 25mg Amphotericin B USP 100% Powder 1gm Cyclobenzaprine HCl USP Recordkeeping and Pedigree Papers During the course of the inspection, Respondent requested the opportunity to review pedigree papers and other source-related records for the prescription drugs Petitioner received from Life Specialty. Specifically, Petitioner could not produce any pedigree papers for prescription drugs received from Life Specialty. Petitioner received from Life Specialty, without a valid pedigree paper, the following: Sarapin Ketamine Hydrochorlide USP Progesterone Micro USP Testosterone Propionate Micro USP Cyclobenzaprine HCl USP Recordkeeping Petitioner did not acquire all of its pedigree papers contemporaneously with the underlying transactions. Petitioner acquired many of the pedigree papers for the prescription drugs in its inventory after the Respondent's inspection. Petitioner's explanation for these failures was not credible.
Recommendation Based on the Findings of Facts and the Conclusion of Law cited above, it is RECOMMENDED that the Department of Health enter a final order, denying Petitioner's application for a permit to act as a retail pharmacy drug wholesale distributor. DONE AND ENTERED this 1st day of September, 2010, in Tallahassee, Leon County, Florida. S DANIEL M. KILBRIDE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 1st day of September, 2010.
Findings Of Fact The Respondent Herman Ginsberg is a licensed pharmacist having been issued license number 0008019. The last known address of the Respondent is 775 Northeast 164th Street, North Miami Beach, Florida 33162. At all times material to this proceeding, the Respondent was the managing pharmacist at Jaffe Pharmacy, also known as Jaffe Discount Drugs, located at 737 Northeast 167th Street, North Miami Beach, Florida 33162. On or about November 26, 1980, the Respondent Ginsberg directed a clerk at the pharmacy, Lorraine Gronfine to remove nine (9) prescriptions from the class II prescription records and place them under a desk blotter. The scripts were pulled by Ms. Gronfine prior to a drug inspection by the authorities. According to the Respondent Ginsberg, he was ordered by the manager of the pharmacy, Ed Terry, to pull the prescriptions in order to inflate an insurance claim resulting from a burglary which occurred in September 1980. The Respondent complied with Mr. Terry's request and reported that drugs were stolen which were not in fact stolen in order to inflate an insurance claim to approximately $7,000. The prescriptions were discovered under the blotter by Irving Losee, another pharmacist employed by Jaffe, who turned them over to Graymark Security. Graymark personnel questioned both the Respondent and Ms. Gronfine about the prescriptions and both gave statements to Graymark concerning how the prescriptions came to be placed under the blotter. Many, although not all, of the prescriptions found by Losee were altered. No testimony expert or otherwise was introduced to prove that the Respondent altered the prescriptions in question. As noted by counsel for Respondent, no direct evidence was introduced to rebut the Respondent's sworn denial that he personally altered the prescriptions. In the normal course of business at Jaffee Pharmacy, a patient log was kept for all prescriptions filled on a daily basis. It is undisputed by the parties that the patient log, which was kept by the Respondent, was not altered and reflected the actual number of pills dispensed by the pharmacy. In order to divert classified drugs for personal profit, it is logical to assume that the Respondent would have altered the patient logs along with the prescriptions to consistently cover the amount of classified drugs ordered from pharmaceutical companies and placed on record with the Drug Enforcement Administration. Indeed, the failure to alter the daily patient logs to be consistent with the altered prescriptions was one of the ways that the problem with the altered prescriptions was uncovered. Although Mr. Terry examined the patient logs nightly to grade his employees on their sales of drugs, this would not have necessarily stopped the logs from being changed to conform to the altered prescriptions. The Respondent or anyone with access to the patient logs, could have altered the logs after the nightly review and conform the logs and prescriptions without arousing undue suspicion. No testimony was presented concerning this point other than that the logs did not go to accounting and were presented to Mr. Terry for his review. If Mr. Terry kept the logs and the Respondent had no further access to them, the Petitioner's theory concerning the alterations would be more plausible; however, the record failed to show that the Respondent lacked the ability to alter the logs subsequent to Mr. Terry's review. Each prescription placed into evidence and filled by the Respondent is marked as being "verified by the issuing physician." The Respondent has admitted that some of these prescriptions were not verified and that the certifications were erroneous. The Respondent admitted that a person named Fred Sessler, who was associated with a stress or obesity clinic, was permitted to pick up controlled drugs for the clinic without a prescription. Mr. Sessler was apparently permitted this privilege because the Respondent knew that one of the clinic physicians would eventually furnish a prescription. Additionally, the Respondent has admitted that in connection with the Sessler transactions, he failed to immediately record all the information required in order to dispense oral prescriptions and failed to notify the Drug Enforcement Administration that he was emergency dispensing via telephone. While acting as managing pharmacist at Jaffee, the Respondent ordered and distributed excessive quantities of a Schedule II drug. (See Petitioner's Exhibit 26 and Respondent's Exhibit 1.)
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That the license of the Respondent Herman Ginsberg be suspended for two (2) years and that he be placed on probation for three (3) years thereafter, subject to attending appropriate continuing education classes and working under the direct supervision of a pharmacist approved by the Board. DONE and ENTERED this 27th day of January, 1983, in Tallahassee, Florida. SHARYN L. SMITH Hearing Officer Division of Administrative Hearings Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 904/488-9675 Filed with the Clerk of the Division of Administrative Hearings this 27th day of January, 1983.
The Issue Whether the Respondent committed the violations alleged in paragraphs 5 through 24 and 26 through 37 of the Corrected Second Amended Complaint, as modified, and, if so, the penalties that should be imposed.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing and on the entire record of this proceeding, the following findings of fact are made: The Department is the state agency charged with the administration and enforcement of Sections 499.001 through .081. § 499.004, Fla. Stat. Worldwide Medical Supply is a prescription drug wholesaler who has been issued a permit, numbered 22:01390, to operate at 1452 North Krome Avenue, Suite 102F, Florida City, Miami-Dade County, Florida. On December 7, 2005, an inspection of Worldwide Medical Supply was conducted after a complaint against Worldwide Medical Supply was filed with the Department. Additional inspections were conducted in or about March 2006 and on May 15, 2007. During all three inspections, the Department's inspectors did not review all of the documents in Worldwide Medical Supply's files but took a sampling of the documents maintained by Worldwide Medical Supply relating to prescription drug sales and purchases. All of the drugs at issue herein are prescription drugs, also known as legend drugs. Paragraph 5 of the Corrected Second Amended Administrative Complaint, as amended; sale of prescription drugs to an unauthorized person in violation of § 499.005(15), Fla. Stat.; Petitioner's Exhibit 1.3 Petitioner's Exhibit 1 contains, in pertinent part, a Worldwide Medical Supply invoice, a Uniform Complaint Form, and a written report of an investigation conducted by the complainant, who was a drug agent. The Worldwide Medical Supply invoice, which is dated September 20, 2005, shows that five "Caverject Imp 20MCGKIT 2"4 were billed and shipped to "Health Environment" at an address in Hialeah, Florida. The Invoice includes a physician's license number and indicates that the Caverject was sent to the attention of "Amneris & Angel." The charge relating to this transaction arose out of a complaint and investigative report filed by a drug agent regarding the subject transaction, in which he reported that the physician whose number was included on the invoice was not employed by Health Environment at the time of the shipment. The Department did not present the testimony of the complaining drug agent, and the Sharon Roberts, one of the Department's inspectors who testified at the final hearing, stated that she had not conducted an investigation into the matter and had no personal knowledge of the matter beyond that which appeared on the invoice and in the report. The evidence related to the violation charged in paragraph 5 of the Corrected Second Amended Administrative Complaint is hearsay and cannot support a finding that the Caverject was delivered to an unauthorized person. See § 120.57(1)(c), Fla. Stat.( Hearsay evidence may be used for the purpose of supplementing or explaining other evidence, but it shall not be sufficient in itself to support a finding unless it would be admissible over objection in civil actions.") The evidence presented by the Department is not, therefore, sufficient to establish that the Caverject was sold or transferred to a person who was not authorized to purchase or possess the prescription drug. Paragraph 6 of the Corrected Second Amended Administrative Complaint, as amended; fraudulent authentication of a pedigree in violation of §§ 499.005(14), (18), and (28) and 499.006(10), Fla. Stat.; Petitioner's Exhibit 2. Petitioner's Exhibit 2 consists of a Picking Ticket, a Sales Order, an Invoice, and a Prescription (Legend) Drug Pedigree Form DH2129 ("Pedigree Paper")5 relating to a transaction between CT International and Worldwide Medical Supply. The Invoice, which is dated October 13, 2005, indicates that CT International shipped and billed to Worldwide Medical Supply 15 12GM vials of Carimune and 35 6GM vials of Carimune. The Pedigree Paper was signed by a vice president of CT International, and the signature was dated October 10, 2005. The Pedigree Paper relates to the 35 6GM vials of Carimune sold to Worldwide Medical Supply, it identifies "ZLB" as the manufacturer, and lists "ZLB - CT International" as the "wholesaler's name." The Pedigree Paper does not identify the wholesaler that purchased the prescription drug from the manufacturer or the authorized distributor of record, nor does it contain any information on wholesale distributions subsequent to the purchase from the manufacturer or the authorized distributor of record. A stamp on the Pedigree Paper indicates that it was received and authenticated by Alex Valdes of Worldwide Medical Supply. None of the documents relating to this transaction contain the Florida license number of CT International or Worldwide Medical Supply. The evidence presented by the Department establishes that Worldwide Medical Supply failed to authenticate the Pedigree Paper provided by CT International and to review it for accuracy and completeness. The Pedigree Paper lacked much of the information that must be included in a pedigree paper, and it was, therefore, incomplete and could not be authenticated with the information provided. As a result, the attestation that the Pedigree Paper had been authenticated was false. The evidence presented by the Department was sufficient to establish that the omission of Worldwide Medical Supply's Florida license number constituted a failure to keep the required records of prescription drug transactions. The Department failed, however, to establish that CT International was not authorized to distribute prescription drugs in Florida. Although the records kept by prescription drug wholesalers of transactions involving prescription drugs must include the license number of the person distributing a prescription drug and the person purchasing the drug, the absence of the Florida license number of CT International constitutes an omission in the records. The omission is not, however, proof that CT International is not licensed in Florida, and the Department did not present any evidence to establish the Florida licensure status of CT International. Rather, Ms. Roberts, the Department's inspector, testified that she had no information regarding CT International's licensure status in Florida at the time of the sale of the Carimune because that "was not the issue."6 Paragraph 7 of the Corrected Second Amended Administrative Complaint, as amended; fraudulent authentication of a pedigree in violation of §§ 499.005(14), (18), and (28) and 499.006(10), Fla. Stat.; Petitioner's Exhibit 3. Petitioner's Exhibit 3 consists of a Picking Ticket, a Sales Order, an Invoice, a Credit Memo, and a Pedigree Paper relating to a transaction between CT International and Worldwide Medical Supply. The Invoice, which is dated October 17, 2005, indicates that CT International shipped and billed to Worldwide Medical Supply seven 10ML units of Baygam intramuscular immune globulin. The Pedigree Paper was signed by a vice president of CT International, and the signature was dated October 18, 2005. The Pedigree Paper relates to the seven 10ML units of Baygam sold to Worldwide Medical Supply; lists "CT International" as the wholesaler; identifies "Bayer/Talecris" as the manufacturer; and identifies "McKesson Drug" as the wholesaler that purchased the prescription drug from the manufacturer. The Pedigree Paper does not identify the wholesaler that purchased the prescription drug from McKesson, nor does it contain any information on wholesale distributions subsequent to the purchase from the manufacturer by McKesson. A stamp on the pedigree paper indicates that it was received and authenticated by Alex Valdes of Worldwide Medical Supply. None of the documents relating to this transaction contain the Florida license number of CT International or of Worldwide Medical Supply. The Baygam was returned by Worldwide Medical Supply to CT International, and a credit memo was issued to Worldwide Medical Supply refunding the cost of the drugs. The evidence presented by the Department establishes that Worldwide Medical Supply failed to authenticate the Pedigree Paper provided by CT International and to review it for accuracy and completeness. The Pedigree Paper lacked much of the information that must be included in a pedigree paper, and it was, therefore, incomplete and could not be authenticated with the information provided. As a result, the attestation that the Pedigree Paper had been authenticated was false. For the reasons stated in paragraph 12 above, the evidence presented by the Department failed to establish that CT International was not authorized to distribute prescription drugs in Florida. The evidence was, however, sufficient to establish that the omission of Worldwide Medical Supply's Florida license number constituted the failure to maintain the records required for prescription drug transactions. Paragraph 8 of the Corrected Second Amended Administrative Complaint, as amended; fraudulent authentication of a pedigree and purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4), (14), (18), and (28); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 4. Petitioner's Exhibit 4 consists of a Picking Ticket, an Invoice, and two Pedigree Papers relating to a transaction between CT International and Worldwide Medical Supply. The Invoice, which is dated October 7, 2005, indicates that CT International shipped and billed to Worldwide Medical Supply 14 6GM vials of Carimune and 15 12GM vials of Carimune. The Pedigree Papers for both the 6GM and the 12GM vials of Carimune were signed by a vice president of CT International, and the signatures were dated October 10, 2005. The Pedigree Papers identify "ZLB" as the manufacturer, and lists "ZLB - CT International" as the "wholesaler's name." The Pedigree Papers do not identify the wholesaler that purchased the prescription drugs from the manufacturer or the authorized distributor of record, nor does it contain any information on wholesale distributions subsequent to the purchase from the manufacturer or the authorized distributor of record. A stamp on the Pedigree Paper for the 12GM vials of Carimune indicates that it was received and authenticated by Alex Valdes of Worldwide Medical Supply; there is no such stamp on the Pedigree Paper for the 6MG vials. None of the documents relating to this transaction contain the Florida license number of CT International or of Worldwide Medical Supply. The evidence presented by the Department establishes that Worldwide Medical Supply failed to authenticate the Pedigree Papers provided by CT International and to review them for accuracy and completeness. The Pedigree Papers lacked much of the information that must be included in a pedigree paper, and they were, therefore, incomplete and could not be authenticated with the information provided. There was no indication that the Pedigree Paper relating to the 6GM vials of Carimune was reviewed for completeness, and the attestation that the Pedigree Paper relating to the 12GM vials of Carimune had been authenticated was false. For the reasons stated in paragraph 12 above, the evidence presented by the Department failed to establish that CT International was not authorized to distribute prescription drugs in Florida. The evidence was, however, sufficient to establish that the omission of Worldwide Medical Supply's Florida license number constituted the failure to maintain the records required for prescription drug transactions. The evidence presented by the Department was sufficient to establish that the 6MG and 12MG vials of Carimune purchased by Worldwide Medical Supply from CT International were adulterated drugs in that the pedigree papers for the drugs were incomplete. Paragraph 9 of the Corrected Second Amended Administrative Complaint, as amended; fraudulent authentication of a pedigree and purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4), (14), (18), and (28); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 33. Petitioner's Exhibit 33 consists of a Picking Ticket, an Invoice, and a Pedigree Paper relating to a transaction between CT International and Worldwide Medical Supply. The Invoice, which is dated October 3, 2005, indicates that CT International shipped and billed to Worldwide Medical Supply 100 2ML units of Baygam intramuscular immune globulin. The Pedigree Paper was originated by First Choice Pharmaceutical Wholesalers and signed by its sales manager, with the signature dated July 18, 2005. The Pedigree Paper does not identify the manufacturer of the Baygam and no quantity of Baygam is listed; First Choice Pharmaceutical is identified as the wholesaler that purchased an unspecified quantity of Baygam from the manufacturer; and the Pedigree Paper indicates that the first subsequent wholesale distribution of the Baygam was to CT International. It appears that all of the required information is included in reference to CT International's purchase of Baygam from First Choice Pharmaceuticals, and Drew Arnold signed the Petitioner as the authenticator from CT International. Finally, the Pedigree Paper shows that the second subsequent wholesale distribution was to Worldwide Medical Supply in the amount of "100 vls." A stamp on the Pedigree Paper indicates that it was received and authenticated by Alex Valdes of Worldwide Medical Supply. None of the documents relating to this transaction contain the Florida license number of CT International or of Worldwide Medical Supply. The evidence presented by the Department establishes that Worldwide Medical Supply failed to authenticate the Pedigree Paper provided by CT International and to review it for accuracy and completeness. The Pedigree Paper lacked the name of the manufacturer and the quantity of Baygam purchased by First Choice. The Pedigree Paper was, therefore, incomplete and could not be authenticated with the information provided. As a result, the attestation that the Pedigree Paper had been authenticated was false. For the reasons stated in paragraph 12 above, the evidence presented by the Department failed to establish that CT International was not authorized to distribute prescription drugs in Florida. The evidence was, however, sufficient to establish that the omission of Worldwide Medical Supply's Florida license number constituted the failure to maintain the records required for prescription drug transactions. The evidence presented by the Department was sufficient to establish that the 100 2ML units of Baygam purchased by Worldwide Medical Supply from CT International were adulterated drugs in that the Pedigree Paper for the drugs was incomplete. Paragraph 10 of the Corrected Second Amended Administrative Complaint, as amended; fraudulent authentication of a pedigree and purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4), (14), (18), and (28); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 5. Petitioner's Exhibit 5 consists of a Sales Invoice and a document entitled "Pedigree" relating to a transaction between Medex BioPharm and Worldwide Medical Supply. The Invoice, which is dated August 31, 2005, indicates that Medex BioPharm shipped and billed to Worldwide Medical Supply 11 12gm units of Carimune NF. The pedigree paper is a form apparently generated by Medex BioPharm to conform to the requirements of "Section 503(e)(1) of the Federal Food Drug and Cosmetic Act," and it was signed by Medex BioPharm's compliance officer, with the signature dated September 6, 2005. The pedigree paper identifies the manufacturer of the Carimune as "ZLB" and indicates that Medex BioPharm purchased the Carimune as an "Authorized Distributor," but there is nothing in the pedigree paper regarding the source from which Medex BioPharm purchased the Carimune. The pedigree paper does not contain any information on wholesale distributions subsequent to the purchase by Medex BioPharm, and, in addition, the pedigree paper was not issued prior to or at the same time the prescription drug was shipped. A stamp on the Invoice attached to the pedigree paper indicates that it was received and authenticated by Daphne Csendes of Worldwide Medical Supply. None of the documents relating to this transaction contain the Florida license number of Medex BioPharm or of Worldwide Medical Supply. At the times relevant to the purchase of the Carimune by Worldwide Medical Supply, however, Medex BioPharm held two licenses in Florida, one as a pharmacy and one as a prescription drug wholesaler. The evidence presented by the Department establishes that Worldwide Medical Supply failed to authenticate the pedigree paper provided by Medex BioPharm and to review it for accuracy and completeness. The pedigree paper was incomplete and could not be authenticated with the information provided. As a result, the attestation that the pedigree paper had been authenticated was false. The evidence presented by the Department was sufficient to establish that the omission of Worldwide Medical Supply's Florida license number constituted the failure to maintain the records required for prescription drug transactions. The evidence presented by the Department was not sufficient to establish that Medex BioPharm was not authorized to distribute the Carimune identified in the Invoice and pedigree paper to Worldwide Medical Supply. Medex BioPharm had a wholesaler's license to sell prescription drugs in Florida at the time relevant to this transaction; the failure to include Medex BioPharm's license number in the documentation of the sale constitutes only a recordkeeping error. As further proof that Worldwide Medical Supply purchased the Carimune from an unauthorized source, the Department presented the testimony of Ms. Roberts, one of the Department's inspectors. Ms. Roberts testified that she attempted to authenticate the purchase of the Carimune by Medex BioPharm and learned that Medex BioPharm was "purchasing [the Carimune] using their pharmacy license, and then, selling [the Carimune], using their wholesale license."7 According to Ms. Roberts, this practice is not permitted and renders the Carimune contraband drugs. Ms. Roberts did not, however, provide any more specific information regarding the purchase of the Carimune by Medex BioPharm. Ms. Robert's testimony is hearsay and cannot support a finding of fact that Medex BioPharm was not authorized to distribute prescription drugs to Worldwide Medical Supply. See § 120.57(1)(c), Fla. Stat. ("Hearsay evidence may be used for the purpose of supplementing or explaining other evidence, but it shall not be sufficient in itself to support a finding unless it would be admissible over objection in civil actions.") The evidence presented by the Department was sufficient to establish that the 11 12gm units of Carimune NF purchased by Worldwide Medical Supply from Medex BioPharm were adulterated drugs in that the pedigree paper for the drugs was incomplete. Paragraph 11 of the Corrected Second Amended Administrative Complaint, as amended; fraudulent authentication of a pedigree and purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4), (14), (18), and (28); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 6. Petitioner's Exhibit 6 consists of a Packing Slip dated September 6, 2005, a Sales Invoice dated September 7, 2005, and a document entitled "Pedigree" relating to a transaction between Medex BioPharm and Worldwide Medical Supply. The Invoice, which is dated September 7, 2005, indicates that Medex BioPharm shipped and billed to Worldwide Medical Supply 20 2ml units of Baygam. The pedigree paper is a form apparently generated by Medex BioPharm to conform to the requirements of "Section 503(e)(1) of the Federal Food Drug and Cosmetic Act," and it was signed by Medex BioPharm's compliance officer, with the signature dated September 8, 2005. The pedigree paper identifies the manufacturer of the Baygam as "Talecris" and indicates that Medex BioPharm purchased the Baygam as an "Authorized Distributor," but there is nothing in the pedigree paper regarding the source from which Medex BioPharm purchased the Baygam or the date on which it was purchased. The pedigree paper does not contain any information on wholesale distributions subsequent to the purchase by Medex BioPharm, and, in addition, the pedigree paper was not issued prior to or at the same time the prescription drug was shipped. A stamp on the pedigree paper indicates that it was received and authenticated by Daphne Csendes of Worldwide Medical Supply. None of the documents relating to this transaction contain the Florida license number of Medex BioPharm or of Worldwide Medical Supply. At the times relevant to the purchase of the Baygam by Worldwide Medical Supply, however, Medex BioPharm held two licenses in Florida, one as a pharmacy and one as a prescription drug wholesaler. The evidence presented by the Department establishes that Worldwide Medical Supply failed to authenticate the pedigree paper provided by Medex BioPharm and to review it for accuracy and completeness. The pedigree paper was incomplete and could not be authenticated with the information provided. As a result, the attestation that the pedigree paper had been authenticated was false. For the reasons stated in paragraph 33 above, the evidence presented by the Department failed to establish that Medex BioPharm was not authorized to distribute prescription drugs in Florida. The evidence was, however, sufficient to establish that the omission of Worldwide Medical Supply's Florida license number constituted the failure to maintain the records required for prescription drug transactions. The evidence presented by the Department was sufficient to establish that the 20 2ml units of Baygam purchased by Worldwide Medical Supply from Medex BioPharm were adulterated drugs in that the pedigree paper for the drugs was incomplete. Paragraph 12 of the Corrected Second Amended Administrative Complaint, as amended; fraudulent authentication of a pedigree and purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4), (14), (18), and (28); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 7. Petitioner's Exhibit 7 consists of an Invoice and a document entitled "Pedigree Paper/Product History" relating to a transaction between Medical Infusion Technologies and Worldwide Medical Supply. The Invoice, which is dated June 10, 2005, indicates that Medical Infusion Technologies shipped and billed to Worldwide Medical Supply 33 10gm units of Gammunex and 14 5gm units of Gammunex. The pedigree paper is a form apparently generated by Medical Infusion Technologies to conform to the requirements of "section (e)(1) of the Federal Food Drug and Cosmetic Act." The pedigree paper was not signed or dated. The pedigree paper identifies the manufacturer of the Gammunex as "Bayer" and indicates that the distributor of record is "FFF" and that the Gammunex was purchased by FFF on June 8, 2005, but there is nothing in the pedigree paper regarding the source from which Medical Infusion Technologies purchased the Gammunex. The pedigree paper does not contain any information on wholesale distributions subsequent to the purchase by FFF. A stamp on the Invoice attached to the pedigree paper indicates that it was received and authenticated by Daphne Csendes of Worldwide Medical Supply. None of the documents relating to this transaction contain the Florida license number of Medical Infusion Technologies or of Worldwide Medical Supply. Medical Infusion Technologies was, however, authorized to distribute prescription drugs in Florida at the time relevant to the sale of the Gammunex.8 The evidence presented by the Department establishes that Worldwide Medical Supply failed to authenticate the pedigree paper provided by Medical Infusion Technologies and to review it for accuracy and completeness. The pedigree paper was incomplete and could not be authenticated with the information provided. As a result, the attestation that the pedigree paper had been authenticated was false. 48. The evidence presented by the Department was sufficient to establish that the omission of Worldwide Medical Supply's Florida license number constituted the failure to maintain the records required for prescription drug transactions. The evidence presented by the Department was not sufficient to establish that Medical Infusion Technologies was not authorized to distribute the Gammunex identified in the Invoice and pedigree paper to Worldwide Medical Supply. Medical Infusion Technologies had a wholesaler's license to sell prescription drugs in Florida at the time relevant to this transaction; the failure to include Medical Infusion Technologies' license number in the documentation of the sale constitutes a recordkeeping error. The evidence presented by the Department was sufficient to establish that the 33 10gm units of Gammunex and 14 5gm units of Gammunex purchased by Worldwide Medical Supply from Medical Infusion Technologies were adulterated drugs in that the pedigree paper for the drugs was incomplete. Paragraph 13 of the Corrected Second Amended Administrative Complaint, as amended; fraudulent authentication of a pedigree and purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4), (14), (18), and (28); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 8. Petitioner's Exhibit 8 consists of an Invoice and a document entitled "Pedigree Paper/Product History" relating to a transaction between Medical Infusion Technologies and Worldwide Medical Supply. The Invoice, which is dated June 16, 2005, indicates that Medical Infusion Technologies shipped and billed to Worldwide Medical Supply 25 units of Flebogamma. The exhibit also contains a document from Cardinal Health showing that, on June 14, 2005, it sold 25 units of Flebogamma to Medical Infusion Technologies. The pedigree paper is a form apparently generated by Medical Infusion Technologies to conform to the requirements of "section (e)(1) of the Federal Food Drug and Cosmetic Act." The pedigree paper is not signed or dated. It identifies the manufacturer of the Flebogamma as "Grifols" and indicates that the distributor of record is "Cardinal Health." An Invoice attached to the pedigree paper shows that the Flebogamma was sold to Medical Infusion Technologies by Cardinal Health, but the pedigree paper does not indicate the lot number and quantity of Flebogamma that Cardinal Health purchased from Grifols, nor does it or the Invoice indicate the dosage form of the Flebogamma purchased by Cardinal Health from Grifols. A stamp on the Invoice attached to the pedigree paper indicates that it was received and authenticated by Daphne Csendes of Worldwide Medical Supply. None of the documents relating to this transaction contain the Florida license number of Medical Infusion Technologies or of Worldwide Medical Supply. Medical Infusion Technologies was, however, authorized to distribute prescription drugs in Florida at the time relevant to the sale of the Flebogamma.9 The evidence presented by the Department establishes that Worldwide Medical Supply failed to authenticate the pedigree paper provided by Medical Infusion Technologies and to review it for accuracy and completeness. The pedigree paper was incomplete and could not be authenticated with the information provided. As a result, the attestation that the pedigree paper had been authenticated was false. For the reasons stated in paragraph 47 above, the evidence presented by the Department failed to establish that Medical Infusion Technologies was not authorized to distribute prescription drugs in Florida.10 The evidence was, however, sufficient to establish that the omission of Worldwide Medical Supply's Florida license number constituted the failure to maintain the records required for prescription drug transactions. As further proof that Worldwide Medical Supply purchased the Flebogamma from an unauthorized source, the Department presented the testimony of Ms. Roberts that, when she attempted to authenticate the pedigree of the Flebogamma, she telephoned Cardinal Health and asked if they sold the Flebogamma to Medical Infusion Technologies: "They did confirm that they sold to Medical Infusion Technologies this product, but Cardinal explained to me that they sold to Medical Infusion Technologies as an end-user, like a pharmacy, which is not permitted for resale to a wholesaler."11 According to Ms. Robert's, an end- user may not sell a prescription drug to a wholesaler, and such a sale renders the Flebogamma contraband drugs. Ms. Roberts did not provide any more specific information regarding the purchase of the Flebogamma by Medical Infusion Technologies. Ms. Robert's testimony is hearsay and cannot support a finding of fact that Medical Infusion Technologies was not authorized to distribute prescription drugs to Worldwide Medical Supply. See § 120.57(1)(c), Fla. Stat. ("Hearsay evidence may be used for the purpose of supplementing or explaining other evidence, but it shall not be sufficient in itself to support a finding unless it would be admissible over objection in civil actions.") The evidence presented by the Department was sufficient to establish that the 25 units of Flebogamma purchased by Worldwide Medical Supply from Medical Infusion Technologies were adulterated drugs in that the pedigree paper for the drugs was incomplete. Paragraph 14 of the Corrected Second Amended Administrative Complaint, as amended; fraudulent authentication of a pedigree and purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4), (14), (18), and (28); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 9. Petitioner's Exhibit 9 consists of an Invoice and a document entitled "Pedigree Paper/Product History" relating to a transaction between Medical Infusion Technologies and Worldwide Medical Supply. The Invoice, which is dated November 8, 2005, indicates that Medical Infusion Technologies shipped and billed to Worldwide Medical Supply 100 units of Gammar P. The pedigree paper is a form apparently generated by Medical Infusion Technologies to conform to the requirements of "section (e)(1) of the Federal Food Drug and Cosmetic Act." The pedigree paper is not signed or dated. It identifies the manufacturer of the Gammar P as "Aventis" and indicates that the distributor of record is "Cardinal Health." The pedigree paper does not include the lot number and quantity of Gammar P that Cardinal Health purchased from Aventis, nor does it indicate the dosage form of the Gammar P purchased by Cardinal Health from Aventis. A stamp on the Invoice attached to the pedigree paper indicates that it was received and authenticated by Alex Valdes of Worldwide Medical Supply. None of the documents relating to this transaction contain the Florida license number of Medical Infusion Technologies or of Worldwide Medical Supply. Medical Infusion Technologies was, however, authorized to distribute prescription drugs in Florida at the time relevant to the sale of the Flebogamma.12 The evidence presented by the Department establishes that Worldwide Medical Supply failed to authenticate the pedigree paper provided by Medical Infusion Technologies and to review it for accuracy and completeness. The pedigree paper was incomplete and could not be authenticated with the information provided. As a result, the attestation that the pedigree paper had been authenticated was false. For the reasons stated in paragraph 47 above, the evidence presented by the Department failed to establish that Medical Infusion Technologies was not authorized to distribute prescription drugs in Florida. The evidence was, however, sufficient to establish that the omission of Worldwide Medical Supply's Florida license number constituted the failure to maintain the records required for prescription drug transactions. The evidence presented by the Department was sufficient to establish that the 100 units of Gammar P purchased by Worldwide Medical Supply from Medical Infusion Technologies were adulterated drugs in that the pedigree paper for the drugs was incomplete. Paragraph 15 of the Corrected Second Amended Administrative Complaint, as amended; purchase of prescription drugs from an unauthorized person in violation of § 499.005(14); Petitioner's Exhibit 10. Petitioner's Exhibit 10 consists of an Order Acknowledgement, a Packing List, a Statement of Account, and an Invoice relating to a transaction between Lupin Pharmaceuticals, Inc., and Worldwide Medical Supply. The Invoice, which is dated August 16, 2004, indicates that Lupin Pharmaceuticals, Inc., shipped and billed to Worldwide Medical Supply two units of Octagam 5%. Lupin Pharmaceuticals, Inc., was not required to provide a pedigree paper to Worldwide Medical Supply for the sale of the Octagam because Lupin Pharmaceuticals, Inc., is the manufacturer of the drug. It did not, however, have a manufacturer's license to ship prescription drugs to Florida from the address in Kentucky from which it shipped the Octagam to Worldwide Medical Supply. The evidence presented by the Department was sufficient to establish that Worldwide Medical Supply purchased the Octagam from an unauthorized person. Paragraph 16 of the Corrected Second Amended Administrative Complaint, as amended; fraudulent authentication of a pedigree and purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4), (14), (18), and (28); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 11. Petitioner's Exhibit 11 consists of an Invoice, a copy of the same Invoice stamped "Paid," and a document entitled "Pedigree Statement" relating to a transaction between Premium Health Services and Worldwide Medical Supply. The Invoice, which is dated September 23, 2004, indicates that Premium Health Services shipped and billed to Worldwide Medical Supply 16 12gm vials of Carimune. The pedigree paper is a form apparently generated by Premium Health Services to conform to the requirements of "section (e)(1) of the Federal Food Drug and Cosmetic Act." The pedigree paper is signed by a "corporate officer" and dated September 23, 2004. The pedigree paper identifies the manufacturer of the Carimune as "ZLB Bioplasma" and indicates that Premium Health Services is the authorized distributor of the Carimune. The pedigree paper does not include the address, telephone number, or purchase invoice number for the purchase of the Carimune by Premium Health Services from ZLB Bioplasma.13 A stamp on the Invoice attached to the pedigree paper indicates that it was received and authenticated by Luis Dilan of Worldwide Medical Supply. None of the documents relating to this transaction contain the Florida license number of Premium Health Services or of Worldwide Medical Supply. The state database shows that Premium Health Services' Florida prescription drug wholesaler license expired on June 30, 2004. The evidence presented by the Department establishes that Worldwide Medical Supply failed to authenticate the pedigree paper provided by Medical Infusion Technologies and to review it for accuracy and completeness. The pedigree paper was incomplete and could not be authenticated with the information provided. As a result, the attestation that the pedigree paper had been authenticated was false. The evidence presented by the Department also was sufficient to establish that Premium Health Services was not authorized to distribute prescription drugs in Florida at the time it sold the Carimune to Worldwide Medical Supply. The evidence was, additionally, sufficient to establish that the omission of Worldwide Medical Supply's Florida license number constituted the failure to maintain the records required for prescription drug transactions. The evidence presented by the Department was sufficient to establish that the 16 12gm vials of Carimune purchased by Worldwide Medical Supply from Premium Health Services were adulterated drugs in that the pedigree paper for the drugs was incomplete. Paragraph 17 of the Corrected Second Amended Administrative Complaint, as amended; purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4) and (18); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 12. Petitioner's Exhibit 12 consists of a Packing Slip, an Invoice, a copy of the same Invoice stamped "Paid," and a Pedigree Paper relating to a transaction between Priority Pharmaceuticals and Worldwide Medical Supply. The Invoice, which is dated May 25, 2005, indicates that Priority Pharmaceuticals shipped and billed to Worldwide Medical Supply 10 10ml units of Baygam. The Pedigree Paper is signed by an individual who identifies himself as "Buyer"; the date of the signature is incomplete, giving the month but no day or year. The Pedigree Paper identifies the manufacturer of the Baygam as "Bayer" and also indicates that "Bayer" is the "authorized distributor of record" in addition to being the manufacturer. The Pedigree Paper shows a subsequent wholesale distribution to Worldwide Medical Supply, but the same individual that signed the Pedigree Paper also signed the subsequent distribution section as the "authenticator." A stamp on the Invoice marked "Paid" indicates that it was received and authenticated by Daphne Csendes of Worldwide Medical Supply. The evidence presented by the Department was sufficient to establish that the 10 10ml units of Baygam purchased by Worldwide Medical Supply from Priority Pharmaceuticals were adulterated drugs in that the pedigree paper for the drugs was incomplete. Paragraph 18 of the Corrected Second Amended Administrative Complaint, as amended; purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4) and (18); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 13. Petitioner's Exhibit 13 consists of five sets of documents relating to transactions between Prodigy Health Supplier Corporation and Worldwide Medical Supply on or about April 27, 2005, and May 11, 18, and 20, 2005. The Department has charged Worldwide Medical Supply in its Corrected Second Amended Administrative Complaint with four violations of Sections 499.001 through .081, Florida Statutes, each corresponding to a specific date.14 The first set of documents consists of a Picking Slip and Invoice dated April 27, 2005, together with a copy of the Picking Slip showing that it was posted April 28, 2005, and a copy of the Invoice showing that it was paid on May 11, 2005. The Invoice, which is dated May 25, 2005, indicates that Prodigy Health Supplier Corporation 30 10g vials of Gammar. No pedigree paper was included with the Invoices and Picking Slips. The evidence presented by the Department was, therefore, sufficient to establish that the 30 10g vials of Gammar were adulterated because they were not accompanied by a pedigree paper. The second set of documents consists of a Pedigree Paper dated May 17, 2005, and Picking Slip and Invoice dated May 11, 2005. The Invoice indicates that 20 6g vials and 10 3g vials of Carimune NF was sold by Prodigy Health Supplier Corporation to Worldwide Medical Supply on May 11, 2005. The Pedigree Paper indicates that ZLB Bioplasma is the manufacturer of the drugs and includes the NDC number, the lot numbers, and the quantity of the drug, which correspond to the lot numbers and quantity of the Carimune sold by Prodigy Health Supplier Corporation to Worldwide Medical Supply. The Pedigree Paper further indicates that Prodigy Health Supplier Corporation was the authorized distributor of record for the Carimune, but the invoice number and date identified on the Pedigree Paper are the invoice number of the Invoice and date relating to the transaction between Prodigy Health Supplier Corporation and Worldwide Medical Supply, not between ZLB Bioplasma and Prodigy Health Supplier Corporation. The Pedigree Paper shows no subsequent wholesale distribution. The Pedigree Paper is signed by an individual who identifies himself as "VP"; the signature is dated May 17, 2005. The evidence presented by the Department with respect to this set of documents was sufficient to establish that the 20 6g vials and 10 3g vials of Carimune NF purchased by Worldwide Medical Supply from Prodigy Health Supplier Corporation were adulterated drugs in that the pedigree paper for the drugs was incomplete. The third set of documents consists of a Pedigree Paper dated May 17, 2005, and a Picking Slip and Invoice dated May 18, 2005. The Invoice indicates that 20 6g vials of Carimune NF were sold by Prodigy Health Supplier Corporation to Worldwide Medical Supply on May 18, 2005. The Pedigree Paper indicates that ZLB Bioplasma is the manufacturer of the drugs and includes the NDC number, the lot numbers, and the quantity of the drug, which correspond to the lot numbers and quantity of the Carimune sold by Prodigy Health Supplier Corporation to Worldwide Medical Supply. The Pedigree Paper further indicates that Prodigy Health Supplier Corporation was the authorized distributor of record for the Carimune, but the invoice number and date identified on the Pedigree Paper is the number of the Invoice and date relating to the transaction between Prodigy Health Supplier Corporation and Worldwide Medical Supply, not between ZLB Bioplasma and Prodigy Health Supplier Corporation. The Pedigree Paper shows no subsequent wholesale distribution history. The evidence presented by the Department with respect to this set of documents was sufficient to establish that the 20 6g vials of Carimune NF purchased by Worldwide Medical Supply from Prodigy Health Supplier Corporation were adulterated drugs in that the pedigree paper for the drugs was incomplete. The fourth set of documents consists of two Pedigree Papers dated May 20, 2005, and an Invoice dated May 20, 2005. The Invoice indicates that 20 10g vials of Gammar, five 10g units of Flebogamma, and 10 5g units of Flebogamma were sold by Prodigy Health Supplier Corporation to Worldwide Medical Supply on May 20, 2005. The Pedigree Papers indicate that ZLB Bioplasma is the manufacturer of the Gammar P and that Grifols Biologicals is the manufacturer of the Flebogamma; they include the NDC numbers, the lot numbers, and the quantities of the drugs, which correspond to the lot numbers and quantity of the Gammar P and Flebogamma sold by Prodigy Health Supplier Corporation to Worldwide Medical Supply. The Pedigree Paper for the Flebogamma further indicates that Prodigy Health Supplier Corporation was the authorized distributor of record for the Flebogamma, but the invoice number and date identified on the Pedigree Paper is the number of the Invoice and the date relating to the transaction between Prodigy Health Supplier Corporation and Worldwide Medical Supply, not between Grifols Biologicals and Prodigy Health Supplier Corporation. The Pedigree Paper shows no subsequent wholesale distribution history relating to the Flebogamma. The Pedigree Paper for the Gammar P indicates that Premium Health Services was the authorized distributor of record for the Gammar P and that Prodigy Health Supplier Corporation purchased the Gammar P from Premium Health Services, but the invoice number and date identified on the Pedigree Paper is the number of the Invoice and date relating to the transaction between Prodigy Health Supplier Corporation and Worldwide Medical Supply, not between Grifols Biologicals and Premium Health Services. In addition, there is nothing on the Pedigree Paper for the Gammar P to indicate that the pedigree from Premium Health Services was authenticated by Prodigy Health Supplier Corporation. The evidence presented by the Department with respect to this set of documents was sufficient to establish that the 20 10g vials of Gammar, five 10g units of Flebogamma, and 10 5g units of Flebogamma purchased by Worldwide Medical Supply from Prodigy Health Supplier Corporation were adulterated drugs in that the pedigree paper for the drugs was incomplete. Paragraph 19 of the Corrected Second Amended Administrative Complaint, as amended; fraudulent authentication of a pedigree and purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4), (14), (18), and (28); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 14. Petitioner's Exhibit 14 consists of an Invoice, a Pedigree Paper, and a facsimile transmittal cover page relating to a transaction between PMP Health Services and Worldwide Medical Supply. The Invoice, which is dated April 26, 2004, indicates that PMP Health Services shipped and billed to Worldwide Medical Supply eight 10GM units of Gammagard S/D. The Pedigree Paper was apparently originated by PMP Health Services and was signed by an individual who identified himself as "Sec.," with the signature dated April 26, 2004. The Pedigree Paper identifies the manufacturer of the Gammagard as Baxter and includes the lot number and quantity of the drug.15 The invoice number and date below the information related to the manufacturer correspond to the Invoice and date relating to the transaction between PMP Health Services and Worldwide Medical Supply. Cardinal Health is identified on the Pedigree Paper as the authorized distributor of record of the Gammagard, and the subsequent wholesale distribution history shows that the Gammagard was purchased from Cardinal Health by a prescription drug wholesaler in Maryland whose name is illegible on the Pedigree Paper and that the Gammagard was purchased from this company by PMP Health Services. The Pedigree Paper does not contain the purchase date or invoice number for any of the transactions prior to the sale to Worldwide Medical Supply, nor is there any indication that the pedigree of the Gammagard was authenticated by the Maryland company or by PMP Health Services. A facsimile transmittal cover page includes a handwritten note that "This is the pedigree for the Gammagard" and appears to relate to the April 26, 2005, transaction. A stamp on the facsimile transmittal cover page indicates that it was received and authenticated by Luis Dilan of Worldwide Medical Supply. None of the documents relating to this transaction contain the Florida license number of PMP Health Services or of Worldwide Medical Supply. PMP Health Services was, however, authorized to distribute prescription drugs in Florida at the time relevant to the sale of the Gammagard. The evidence presented by the Department establishes that Worldwide Medical Supply failed to authenticate the Pedigree Paper provided by PMP Health Services and to review it for accuracy and completeness. The Pedigree Paper did not include much of the information required for a pedigree, and it was, therefore, incomplete and could not be authenticated with the information provided. As a result, the attestation that the Pedigree Paper had been authenticated was false. The evidence presented by the Department was not sufficient to establish that PMP Health Services was not authorized to distribute the Gammagard identified in the Invoice and Pedigree Paper to Worldwide Medical Supply. PMP Health Services had a wholesaler's license to sell prescription drugs in Florida at the time relevant to this transaction; the failure to include PMP Health Services' license number in the documentation of the sale constitutes only a recordkeeping error. The evidence was, additionally, sufficient to establish that the omission of Worldwide Medical Supply's Florida license number constituted the failure to maintain the records required for prescription drug transactions. The evidence presented by the Department was sufficient to establish that the eight 10GM units of Gammagard S/D purchased by Worldwide Medical Supply from PMP Health Services were adulterated drugs in that the Pedigree Paper for the drugs was incomplete. Paragraph 20 of the Corrected Second Amended Administrative Complaint, as amended; purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4) and (18); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 15. Petitioner's Exhibit 15 consists of an Invoice and a "Statement Identifying Pharmaceutical Sale" relating to a transaction between PMP Health Services and Worldwide Medical Supply. The Invoice, which is dated June 3, 2004, indicates that PMP Health Services shipped and billed to Worldwide Medical Supply eight 10GM units of Gammagard S/D. The "Statement Identifying Pharmaceutical Sale" is a form apparently generated by PMP Health Services to conform to the requirements of "Section 503(e)(1) of the Federal Food Drug and Cosmetic Act," and was intended as a pedigree paper for the transaction. The pedigree paper is not signed or dated but includes under a paragraph entitled "Unauthorized Vendor Certification" the typewritten name of an individual who is otherwise unidentified. The pedigree paper identifies the manufacturer of the Gammagard as "Baxter" and also includes the NDC number, expiration date, and lot number of the drug. No quantity or dosage amount is included, however. The pedigree paper shows that PMP Health Services purchased the Gammagard from BioMed Plus, which is identified as an "Authorized Distributor"; there is no information regarding BioMed Plus's purchase of the drug or and no further information regarding PMP Health Services' purchase of the drug from BioMed Plus. A stamp on the Invoice indicates that it was received and authenticated by Luis Dilan of Worldwide Medical Supply. The evidence presented by the Department was sufficient to establish that the eight 10GM units of Gammagard S/D purchased by Worldwide Medical Supply from PMP Health Services were adulterated drugs in that the pedigree paper for the drugs was incomplete. Paragraph 21 of the Corrected Second Amended Administrative Complaint, as amended; fraudulent authentication of a pedigree and purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4), (14), (18), and (28); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 16. Petitioner's Exhibit 16 consists of an Invoice and a Pedigree Paper dated June 21, 2004, and an Invoice and a Pedigree Paper dated July 19, 2004, relating to two transactions between PMP Health Services and Worldwide Medical Supply. The Invoice dated July 19, 2004, indicates that PMP Health Services shipped and billed to Worldwide Medical Supply 32 10GM units of Gammunex 10%.16 The Pedigree Paper related to the July 19, 2004, transaction was apparently originated by PMP Health Services and was signed by an individual who identified himself as "Sec.," with the signature dated July 19, 2004. The Pedigree Paper identifies Bayer as the manufacturer of the Gammunex and includes the lot number and quantity of the drug.17 The invoice number and date below the information related to the manufacturer correspond to the Invoice and date relating to the transaction between PMP Health Services and Worldwide Medical Supply. "PHC" is identified on the Pedigree Paper as the authorized distributor of record of the Gammunex, and the subsequent sales history shows that the Gammunex was purchased from PHC by PMP Health Services. The Pedigree Paper contains the purchase date, but it does not include the invoice number for the purchase by PMP Health Services from PHC, nor is there any indication that the pedigree of the Gammunex was authenticated by PMP Health Services. A stamp on the July 19, 2004, Invoice indicates that it was received and authenticated by Luis Dilan of Worldwide Medical Supply. None of the documents relating to this transaction contain the Florida license number of PMP Health Services or of Worldwide Medical Supply. PMP Health Services was, however, authorized to distribute prescription drugs in Florida at the time relevant to the sale of the Gammunex. The evidence presented by the Department establishes that Worldwide Medical Supply failed to authenticate the Pedigree Paper provided by PMP Health Services and to review them for accuracy and completeness. The Pedigree Paper did not include much of the information required for a pedigree, and it was, therefore, incomplete and could not be authenticated with the information provided. As a result, the attestation that the Pedigree Paper had been authenticated was false. The evidence presented by the Department was not sufficient to establish that PMP Health Services was not authorized to distribute the Gammunex identified in the Invoice and Pedigree Paper to Worldwide Medical Supply. PMP Health Services had a wholesaler's license to sell prescription drugs in Florida at the time relevant to this transaction; the failure to include PMP Health Services' license number in the documentation of the sale constitutes only a recordkeeping error. The evidence was, however, sufficient to establish that the omission of Worldwide Medical Supply's Florida license number constituted the failure to maintain the records required for prescription drug transactions. The evidence presented by the Department was sufficient to establish that the 32 10GM units of Gammunex 10% purchased by Worldwide Medical Supply from PMP Health Services were adulterated drugs in that the Pedigree Paper for the drugs was incomplete. Paragraph 22 of the Corrected Second Amended Administrative Complaint, as amended; purchase of prescription drugs from an unauthorized person in violation of § 499.005(14); Petitioner's Exhibit 17. Petitioner's Exhibit 17 consists of a Sales Order Pick Suggestion and Invoice dated June 7, 2005, and a Sales Order Pick Suggestion and Invoice dated June 22, 2005, relating to two transactions between Questcor Pharmaceuticals, Inc., and Worldwide Medical Supply. The Invoice dated June 7, 2005, indicates that Questcor Pharmaceuticals, Inc., shipped and billed to Worldwide Medical Supply five units of Acthar; the Invoice dated June 22, 2004, indicates that Questcor Pharmaceuticals, Inc., shipped and billed to Worldwide Medical Supply five units of Acthar. Questcor Pharmaceuticals, Inc., was not required to provide a pedigree paper to Worldwide Medical Supply for the sale of the Acthar because it is the manufacturer of the drug, but it did not have a manufacturer's license to distribute prescription drugs in Florida from the address in Kentucky from which it shipped the Acthar to Worldwide Medical Supply. It did, however, have a manufacturer's license to distribute prescription drugs in Florida from an address in California. The evidence presented by the Department was sufficient to establish that Worldwide Medical Supply purchased the Acthar from an unauthorized person on June 7 and 22, 1005. Paragraph 23 of the Corrected Second Amended Administrative Complaint, as amended; fraudulent authentication of a pedigree and purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4), (14), (18), and (28); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 18. Petitioner's Exhibit 18 consists of an Invoice dated March 5, 2004, and an Invoice dated October 16, 2003, relating to two transactions between FPP Distribution, Inc., acting as "Logistic Service Providers for: RxBazaar.com," and Worldwide Medical Supply. The Invoice dated October 16, 2003, indicates that FPP Distribution, Inc. shipped and billed to Worldwide Medical Supply 60 10GM tabs of Zyprexa. A handwritten notation appears on this Invoice indicating that the Zyprexa was "Returned for no (1) Pedigree Papers (2) RxBazaar not license [sic] in State of Florida for wholesale distribution." The Invoice dated March 5, 2004, indicates that FPP Distribution, Inc., shipped and billed to Worldwide Medical Supply 3 5MG units of Aricept.18 No pedigree paper was included with the Invoice, and there is no indication that the Aricept was returned. As noted by Worldwide Medical Supply on the October 16, 2003, Invoice, RxBazaar.com was not licensed to distribute prescription drugs in Florida at the time relevant to the sale of the Zyprexa, and neither it nor FPP Distribution, Inc., was licensed to distribute prescription drugs in Florida at the time relevant to the sale of the Aricept. Because neither FPP Distribution, Inc., nor RxBazaar.com was licensed to distribute prescription drugs in Florida at the time relevant to the March 5, 2004, transaction, the evidence presented by the Department was sufficient to establish that Worldwide Medical Supply purchased the Aricept from an unauthorized person. However, even though Worldwide Medical Supply did purchase Zyprexa from FPP Distribution, Inc./RxBazaar.com, the evidence establishes that Worldwide Medical Supply returned the shipment and, therefore, for purposes of a separate violation of Sections 499.001 through .081, Florida Statutes, the evidence presented by the Department was not sufficient to establish that Worldwide Medical Supply completed the purchase of the Zyprexa from an unauthorized person. The evidence presented by the Department was sufficient to establish that the 3 5MG units of Aricept purchased by Worldwide Medical Supply from FPP Distribution, Inc./RxBazaar.com were adulterated drugs in that no pedigree paper was provided for the drugs. Finally, no pedigree papers are included in Petitioner's Exhibit 18, and there is no representation on either the October 16, 2003, or the March 5, 2004, Invoices that anyone at Worldwide Medical Supply authenticated the prescription drug pedigrees. Therefore, the evidence presented by the Department was not sufficient to establish that Worldwide Medical Supply fraudulently authenticated the pedigrees of these drugs. Paragraph 24 of the Corrected Second Amended Administrative Complaint, as amended; purchase of prescription drugs from an unauthorized person and purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4) and (18); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 19.19 Petitioner's Exhibit 19 consists of an Invoice and four documents entitled "Statement Identifying Prior Sales of Prescription Drugs by Wholesalers Required by the Prescription Drug Marketing Act," which apparently are intended to be pedigree papers, relating to a transaction between Allscripts Healthcare Solutions and Worldwide Medical Supply. The Invoice, which is dated February 2, 2004, indicates that Allscripts Healthcare Solutions shipped and billed to Worldwide Medical Supply 30 200mg tabs of Diflucan; 60 2mg tablets of Risperdal; 60 10mg tabs of Zyprexa; and 60 20mg tabs of Zyprexa. Allscripts Healthcare Solutions provided a statement identifying prior sales to Worldwide Medical Supply for each of these four prescription drugs; these statements were apparently intended to be pedigree papers for each of the drugs. The statements identify the manufacturer and NDC number for each drug; include the bulk lot numbers and expiration dates for the drugs; indicate that Allscripts Healthcare Solutions sold the drugs to Worldwide Medical Supply; provide Allscripts Healthcare Solutions' Florida Out-Of-State Prescription Drug Wholesaler Permit number; identify Amerisource Bergen as the person from whom Allscripts Healthcare Solutions purchased the drugs; identify Amerisource Bergen as an authorized distributor for the drugs; and state that Amerisource Bergen did not provide pedigree documents to Allscripts Healthcare Solutions for the drugs. The statements did not include any information regarding the purchase of the drugs from the manufacturers. The evidence presented by the Department was not sufficient to establish that Worldwide Medical Supply purchased the four prescription drugs from an unauthorized person. Allscripts Healthcare Solutions was properly licensed to distribute prescription drugs in Florida at the times of the transactions at issue. The evidence presented by the Department was sufficient to establish that the 30 200mg tabs of Diflucan, 60 2mg tablets of Risperdal, 60 10mg tabs of Zyprexa, and 60 20mg tabs of Zyprexa purchased by Worldwide Medical Supply from Allscripts Healthcare Solutions were adulterated drugs in that the statements intended to provide the pedigrees for the drugs were incomplete. Paragraph 26 of the Corrected Second Amended Administrative Complaint, as amended; fraudulent authentication of a pedigree and purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4), (14), (18), and (28); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 21. Petitioner's Exhibit 21 consists of an Invoice, a Packing Slip, and a "Pedigree" relating to a transaction between ActSys Medical, Inc., and Worldwide Medical Supply. The Invoice dated December 22, 2004, indicates that ActSys Medical, Inc., shipped and billed to Worldwide Medical Supply 10 10ml vials of Baygam. The pedigree paper provided by ActSys Medical, Inc., identified the manufacturer of the Baygam as Bayer, and included the NDC number, the quantity, the lot number, and the expiration date of the drugs. The pedigree paper further identified ActSys Medical, Inc., as the supplier of the drugs and identified ActSys Medical, Inc., as the "authorized distributor." There is no further wholesale distribution history for the drugs in the pedigree paper; there is no information in the pedigree paper regarding the purchase of the drugs by ActSys Medical, Inc.; and the pedigree paper is not signed. A stamp on the December 22, 2004, Invoice indicates that it was received and authenticated by Luis Dilan of Worldwide Medical Supply. None of the documents relating to this transaction contain the Florida license number of ActSys Medical, Inc., or of Worldwide Medical Supply. ActSys Medical, Inc., was not authorized to distribute prescription drugs in Florida at the time relevant to the sale of the Baygam. The evidence presented by the Department establishes that Worldwide Medical Supply failed to authenticate the pedigree paper provided by ActSys Medical, Inc., and to review it for accuracy and completeness. The pedigree paper did not include much of the information required for a pedigree, and it was, therefore, incomplete and could not be authenticated with the information provided. As a result, the attestation that the pedigree paper had been authenticated was false. The evidence presented by the Department was sufficient to establish that ActSys Medical, Inc., was not authorized to distribute the Baygam identified in the Invoice and "Pedigree" provided to Worldwide Medical Supply. The evidence was, additionally, sufficient to establish that the omission of Worldwide Medical Supply's Florida license number constituted the failure to maintain the records required for prescription drug transactions. The evidence presented by the Department was sufficient to establish that the 10 10ml vials of Baygam purchased by Worldwide Medical Supply from ActSys Medical, Inc., were adulterated drugs in that the pedigree paper for the drugs was incomplete. Paragraph 27 of the Corrected Second Amended Administrative Complaint, as amended; fraudulent authentication of a pedigree and purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4), (14), (18), and (28); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 22. Petitioner's Exhibit 22 consists of an Invoice, a copy of the Invoice marked "Paid," a Work Order, and a Pedigree Paper relating to a transaction between Florida Infusion/Nations Drug and Worldwide Medical Supply. The Invoice dated September 15, 2005, indicates that Florida Infusion shipped and billed to Worldwide Medical Supply 14 2ML units of Baygam Immune Globulin I.M. The Pedigree Paper provided by Florida Infusion identified the manufacturer of the Baygam as "Talecris," and included the NDC number, the quantity, the lot number, and the expiration date of the drugs. The Pedigree Paper further identified Florida Infusion as the "authorized distributor of record." There is no further wholesale distribution history for the drugs in the Pedigree Paper and there is no information in the Pedigree Paper regarding the purchase of the drugs by Florida Infusion.20 The invoice number and date included on the Pedigree Paper corresponds to the invoice number and date of the transaction between Florida Infusion and Worldwide Medical Supply. The Pedigree Paper is signed and dated September 19, 2005. A stamp on the September 15, 2005, Work Order indicates that it was received and authenticated by Daphne Csendes of Worldwide Medical Supply. None of the documents relating to this transaction contain the Florida license number of Florida Infusion or of Worldwide Medical Supply. Florida Infusion was, however, authorized to distribute prescription drugs in Florida at the time relevant to the sale of the Baygam. The evidence presented by the Department was not sufficient to establish that Florida Infusion was not authorized to distribute the Baygam identified in the Invoice and Pedigree Paper to Worldwide Medical Supply. Florida Infusion had a wholesaler's license to sell prescription drugs in Florida at the time relevant to this transaction; the failure to include Florida Infusion's license number in the documentation of the sale constitutes only a recordkeeping error. The evidence was, additionally, sufficient to establish that the omission of Worldwide Medical Supply's Florida license number constituted the failure to maintain the records required for prescription drug transactions. The evidence presented by the Department establishes that Worldwide Medical Supply failed to authenticate the Pedigree Paper provided by Florida Infusion and to review it for accuracy and completeness. The Pedigree Paper did not include much of the information required for a pedigree, and it was, therefore, incomplete and could not be authenticated with the information provided. As a result, the attestation that the Pedigree Paper had been authenticated was false. The evidence presented by the Department was sufficient to establish that the 14 2ML units of Baygam Immune Globulin I.M. purchased by Worldwide Medical Supply from Florida Infusion were adulterated drugs in that the Pedigree Paper for the drugs was incomplete. Paragraph 28 of the Corrected Second Amended Administrative Complaint, as amended; purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4), (18), and (29); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 23. Petitioner's Exhibit 23 consists of five Invoices and accompanying shipping documents and a sixth Invoice that is not accompanied by a shipping document; these documents relate to six transactions between Bellco Drug Corp and Worldwide Medical Supply. The first Invoice, dated October 17, 2005, indicates that Bellco Drug Corp shipped and billed to Worldwide Medical Supply eight 10ML units of Chorionic Gonad (N/RTN); the second Invoice, dated October 17, 2005, indicates that Bellco Drug Corp shipped and billed to Worldwide Medical Supply 10 10ML units of Chorionic Gonad (N/RTN); the third Invoice, dated October 17, 2005, indicates that Bellco Drug Corp shipped and billed to Worldwide Medical Supply 5 10ML units of Nubain Inj 10MG/ML N/f; the fourth Invoice, dated October 18, 2005, indicates that Bellco Drug Corp shipped and billed to Worldwide Medical Supply four 20ML units of Ceftriaxone DOD Inj 1GM and 4 2ML units of Thiamine HCL Inj 100MG/ML; the fifth Invoice, dated October 20, 2005, indicates that Bellco Drug Corp shipped and billed to Worldwide Medical Supply 24 10CP units of Tamiflu 75MG; and the sixth Invoice, dated October 31, 2005, indicates that Bellco Drug Corp shipped and billed to Worldwide Medical Supply one 2ML unit of Baygam SDV and three 10CP units of Tamiflu 75MG.21 A stamp on the October 31, 2005, Invoice indicates that it was received and authenticated by Alex Valdes of Worldwide Medical Supply. No pedigree papers were, however, provided for any of the six transactions. The evidence presented by the Department was sufficient to establish that the prescription drugs purchased by Worldwide Medical Supply from Bellco Drug Corp on October 17, 18, 20, and 31, 2005, were adulterated drugs in that no pedigree papers were provided for the drugs. In addition, the evidence presented by the Department was sufficient to establish that Worldwide Medical Supply's purported authentication of the pedigrees of the drugs purchased from Bellco Drug Corp on October 31, 2005, was fraudulent. No authentication was possible because no pedigree paper was provided for the drugs. Paragraph 29 of the Corrected Second Amended Administrative Complaint, as amended; purchase of contraband prescription drugs in violation of §§ 499.005(1)-(4), (18), and (29); 499.006(10); and 499.0051(1)(b), Fla. Stat.; Petitioner's Exhibit 24. Petitioner's Exhibit 24 consists of a Packing List and three statements entitled "Prescription Drug Pedigree" relating to a transaction between BioMed Plus Miami and Worldwide Medical Supply. The Packing List, which is dated December 9, 2004, indicates that BioMed Plus Miami shipped and billed to Worldwide Medical Supply 35 5-gram units of Gammunex 10%; 15 10-gram units of Gammunex 10%; and 5 20- gram units of Gammunex 10%. The "Prescription Drug Pedigree" statements included with the Invoices were apparently created by BioMed Plus Miami. The three "pedigree" statements are not signed or dated. The statements identify the manufacturer of the Gammunex 10% as Bayer, and the only information included on the documents is the name and dosage of the drugs, the NDC numbers, the lot numbers, the expiration dates, and the quantities of the drugs expressed in grams. The statements include no information regarding the purchase of the Gammunex by BioMed Plus Miami or the wholesale distribution history of the drugs. A stamp on the Packing List indicates that it was received and authenticated by Luis Dilan of Worldwide Medical Supply. The evidence presented by the Department was sufficient to establish that the 35 5-gram units of Gammunex 10%, the 15 10-gram units of Gammunex 10%, and the 5 20-gram units of Gammunex 10% purchased by Worldwide Medical Supply from BioMed Plus Miami were adulterated drugs in that the pedigree papers for the drugs were wholly inadequate and incomplete. Paragraph 30 of the Corrected Second Amended Administrative Complaint, as amended; receipt of a prescription drug by a non- permitted facility in violation of §§ 499.005(14) and 499.006(10), Fla. Stat.; Petitioner's Exhibit 25. Petitioner's Exhibit 25 consists of an Invoice and a Packing Slip relating to a transaction between Mercury Medical and Worldwide Medical Supply. The Invoice, which is dated October 13, 2006, indicates that Mercury Medical shipped 20 5ML units of flu vaccine to Rick Nielson at 7904 West Drive, Unit 1017, North Bay Village, Florida 33141 and billed the vaccine to Worldwide Medical Supply. At the time the vaccine was shipped, Rick Nielson was the certified designated representative of Worldwide Medical Supply, and the address to which it was shipped was Mr. Nielson's home address. Mr. Nielson's home was not a facility licensed to receive prescription drug in Florida. The evidence presented by the Department was sufficient to establish that the drug was adulterated because the drug was held by a person not authorized to do so, but the Department presented no evidence to establish that Worldwide Medical Supply was responsible for the shipment or that it committed a violation with respect to this transaction. Paragraph 31 of the Corrected Second Amended Administrative Complaint, as amended; purchase of prescription drugs from an unauthorized person in violation of §§ 499.005(14) and (15) and 499.0051(1)(b), (4),and (5), Fla. Stat.; Petitioner's Exhibit 26. Petitioner's Exhibit 26 consists of a Packing Slip, a Pedigree Paper, and copies of the Georgia and Florida licenses of Medical Infusion Technologies relating to a transaction between Medical Infusion Technologies and Worldwide Medical Supply. The Packing Slip, which is dated April 25, 2006, indicates that a number of 3 gram vials of Carimune NF were shipped to Medical Infusion Technologies at an address in Bossier City, Louisiana. The Pedigree Paper prepared by Worldwide Medical Supply and dated March 6, 2007, indicates that Worldwide Medical Supply purchased nine of the 3 gram vials of Carimune from Medical Infusion Technologies, whose address was noted on the Pedigree Paper as 1525 Doctors Drive, Bossier City, Louisiana. Medical Infusion Technologies did not have a Florida license to distribute prescription drugs from its Bossier City, Louisiana, address. Medical Infusion Technologies' Florida license was issued to Medical Infusion Technologies at 115 Echols Street, Savannah, Georgia. The evidence presented by the Department was, therefore, sufficient to establish that Worldwide Medical Supply purchased the Carimune from a person not authorized to sell the drug in Florida. Paragraph 32 of the Corrected Second Amended Administrative Complaint, as amended; purchase of prescription drugs from an unauthorized person in violation of §§ 499.005(14) and (15) and 499.0051(1)(b), (4),and (5), Fla. Stat.; Petitioner's Exhibit 27. Petitioner's Exhibit 27 consists of a two-page Invoice dated September 25, 2006, and an Order Pick Sheet dated October 10, 2006. These documents relate to transactions involving Broughton Pharmaceuticals, LLC, Worldwide Medical Supply, and an entity referred to as "Kuehne & Nagel - Dallas." The Invoice indicates that, on September 25, 2006, Broughton Pharmaceuticals, LLC, shipped and billed to Worldwide Medical Supply at an address in Dallas, Texas, "c/o Kuehne + Nagel, Inc. (Texas)," 702 6gm units of Carimune. The Order Pick Sheet indicates that, on October 10, 2006, Kuehne + Nagel consigned 46 6gm units of Carimune to Worldwide Medical Supply in Florida City, Florida, and a notation appears on the sheet that a particular Federal Express account was to be used. Kuehne + Nagel is a licensed wholesale distributor of prescription drugs in the State of Texas, as is Worldwide Medical Supply, but it is not licensed as a wholesale distributor of prescription drugs in the State of Florida. The evidence presented by the Department was sufficient to support an inference that the 46 6gm units of Carimune were shipped by Kuehne + Nagel to Worldwide Medical Supply in Florida. The evidence presented by the Department was, therefore, sufficient to establish that Worldwide Medical Supply purchased the Carimune from a person not authorized to sell the drug in Florida. Paragraph 33 of the Corrected Second Amended Administrative Complaint, as amended; purchase of prescription drugs from an unauthorized person in violation of §§ 499.005(14) and (15) and 499.0051(1)(b), (4),and (5), Fla. Stat.; Petitioner's Exhibit 28. Petitioner's Exhibit 28 consists of two Invoices and a two-page Pedigree Paper that relate to transactions involving Broughton Pharmaceuticals, LLC, Worldwide Medical Supply, and Kuehne + Nagel." The first Invoice indicates that, on September 25, 2006, Broughton Pharmaceuticals, LLC, shipped and billed to Worldwide Medical Supply at an address in Dallas, Texas, "c/o Kuehne + Nagel, Inc. (Texas)," 416 6gm units of Carimune. The second Invoice, dated September 29, 2006, indicates that Worldwide Medical Supply shipped and billed to Reliance Pharmaceuticals, LLC, 28 6gm units of Carimune from an address in Florida City, Florida. The Pedigree Paper indicates that Broughton Pharmaceuticals, LLC, sold 28 6gm vials of Carimune NF to Kuehne + Nagel on September 25, 2006, and that these prescription drugs were shipped to Worldwide Medical Supply in Texas. The Pedigree Paper further indicates that Kuehne + Nagel sold the Carimune to Worldwide Medical Supply in Florida on September 26, 2006.22 As previously noted, Kuehne + Nagel is a licensed wholesale distributor of drugs in the State of Texas, but it is not licensed as a wholesale distributor of drugs in the State of Florida. The evidence presented by the Department was, therefore, sufficient to establish that Worldwide Medical Supply purchased the Carimune from a person not authorized to sell the drug in Florida. Paragraph 34 of the Corrected Second Amended Administrative Complaint, as amended; purchase of prescription drugs from an unauthorized person in violation of §§ 499.005(14) and (15) and 499.0051(1)(b), (4),and (5), Fla. Stat.; Petitioner's Exhibit 29. Petitioner's Exhibit 29 consists of an Invoice and a two-page Pedigree Paper that relate to a transaction involving Kuehne + Nagel, Worldwide Medical Supply, and Reliance Pharmaceuticals, LLC. The Invoice indicates that, on October 27, 2006, Worldwide Medical Supply shipped and billed to Reliance Pharmaceuticals, LLC, 45 6gm vials of Carimune NF from an address in Florida City, Florida. The Pedigree Paper indicates that Broughton Pharmaceuticals, LLC, sold 33 6gm vials of Carimune NF to Kuehne + Nagel on September 25, 2006, and that these prescription drugs were shipped to Worldwide Medical Supply in Texas. The Pedigree Paper further indicates that Kuehne + Nagel sold the Carimune to Worldwide Medical Supply in Florida on September 26, 2006. As previously noted, Kuehne + Nagel is a licensed wholesale distributor of drugs in the State of Texas, but it is not licensed as a wholesale distributor of drugs in the State of Florida. The evidence presented by the Department was, therefore, sufficient to establish that Worldwide Medical Supply purchased the Carimune from a person not authorized to sell the drug in Florida. Paragraph 35 of the Corrected Second Amended Administrative Complaint, as amended; purchase of prescription drugs from an unauthorized person in violation of §§ 499.005(14) and (15) and 499.0051(1)(b), (4),and (5), Fla. Stat.; Petitioner's Exhibit 30. Petitioner's Exhibit 30 consists of an Invoice and a two-page Pedigree Paper that relate to a transaction involving Kuehne + Nagel, Worldwide Medical Supply, and Juan F. Lamas, Inc., M.D. The Invoice indicates that, on October 16, 2006, Worldwide Medical Supply shipped and billed to Dr. Lamas 7 6gm vials of Carimune NF from an address in Florida City, Florida. The Pedigree Paper indicates that Broughton Pharmaceuticals, LLC, sold the 7 6gm vials of the Carimune NF to Kuehne + Nagel on September 25, 2006, and that these prescription drugs were shipped to Worldwide Medical Supply in Texas. The Pedigree Paper further indicates that Kuehne + Nagel sold the Carimune to Worldwide Medical Supply in Florida on September 26, 2006. As previously noted, Kuehne + Nagel is a licensed wholesale distributor of drugs in the State of Texas, but it is not licensed as a wholesale distributor of drugs in the State of Florida. The evidence presented by the Department was, therefore, sufficient to establish that Worldwide Medical Supply purchased the Carimune from a person not authorized to sell the drug in Florida. Paragraph 36 of the Corrected Second Amended Administrative Complaint, as amended; purchase of prescription drugs from an unauthorized person in violation of §§ 499.005(14) and (15) and 499.0051(1)(b), (4),and (5), Fla. Stat.; Petitioner's Exhibit 31. Petitioner's Exhibit 31 consists of an Invoice and a two-page Pedigree Paper that relate to a transaction involving Kuehne + Nagel, Worldwide Medical Supply, and Integrated Health Center of America, Inc. The Invoice indicates that, on October 10, 2006, Worldwide Medical Supply shipped and billed to Integrated Health Center of America, Inc., 20 6gm vials of Carimune NF from an address in Florida City, Florida. The Pedigree Paper indicates that Broughton Pharmaceuticals, LLC, sold the 20 6gm vials of the Carimune NF to Kuehne + Nagel on September 25, 2006, and that these prescription drugs were shipped to Worldwide Medical Supply in Texas. The Pedigree Paper further indicates that Kuehne + Nagel sold the Carimune to Worldwide Medical Supply in Florida on September 26, 2006. As previously noted, Kuehne + Nagel is a licensed wholesale distributor of drugs in the State of Texas, but it is not licensed as a wholesale distributor of drugs in the State of Florida. The evidence presented by the Department was, therefore, sufficient to establish that Worldwide Medical Supply purchased the Carimune from a person not authorized to sell the drug in Florida. Paragraph 37 of the Corrected Second Amended Administrative Complaint, as amended; purchase of prescription drugs from an unauthorized person in violation of §§ 499.005(14) and (15) and 499.0051(1)(b), (4),and (5), Fla. Stat.; Petitioner's Exhibit 32. Petitioner's Exhibit 32 consists of an Invoice and a two-page Pedigree Paper that relate to a transaction involving Kuehne + Nagel, Worldwide Medical Supply, and Dr. Wohlfeiler Piperato & Associates. The Invoice indicates that, on September 28, 2006,, Worldwide Medical Supply shipped and billed to Dr. Wohlfeiler Piperato & Associates 12 6gm vials of Carimune NF from an address in Florida City, Florida. The Pedigree Paper indicates that Broughton Pharmaceuticals, LLC, sold the 12 6gm vials of the Carimune NF to Kuehne + Nagel on September 25, 2006, and that these prescription drugs were shipped to Worldwide Medical Supply in Texas. The Pedigree Paper further indicates that Kuehne + Nagel sold the Carimune to Worldwide Medical Supply in Florida on September 26, 2006. As previously noted, Kuehne + Nagel is a licensed wholesale distributor of drugs in the State of Texas, but it is not licensed as a wholesale distributor of drugs in the State of Florida. The evidence presented by the Department was, therefore, sufficient to establish that Worldwide Medical Supply purchased the Carimune from a person not authorized to sell the drug in Florida. The violations committed by Worldwide Medical Supply are substantial, are of long duration, and involve a significant number of transactions relating to the sale and purchase of prescription drugs.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Health enter a final order finding that Worldwide Medical Supply and Pharmaceuticals, Inc., has committed 37 violations of Sections 499.001 through .081, Florida Statutes; imposing an administrative of $185,000.00; and revoking the license of Worldwide Medical Supply and Pharmaceuticals, Inc., to operate as a prescription drug wholesale distributor. DONE AND ENTERED this 1st day of May, 2008, in Tallahassee, Leon County, Florida. PATRICIA M. HART Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 1st day of May, 2008.
The Issue The issue for determination is whether Petitioner must reimburse Respondent for payments totaling $1,140,763.88 that Petitioner received from the Medicaid Program in compensation for the provision of prescription drugs between late-August and November of 1998. Respondent contends that Petitioner is not entitled to retain the payments in question because Petitioner allegedly has failed to demonstrate that it had available during the pertinent period a sufficient quantity of the prescription drugs in question.
Findings Of Fact The parties' Joint Stipulation of Facts and the evidence presented at final hearing established the facts that follow. The Parties The Agency for Health Care Administration (the “Agency”) is responsible for administering the Florida Medicaid Program. As one of its duties, the Agency must recover "overpayments . . . as appropriate," the term "overpayment" being statutorily defined to mean "any amount that is not authorized to be paid by the Medicaid program whether paid as a result of inaccurate or improper cost reporting, improper claiming, unacceptable practices, fraud, abuse, or mistake." See Section 409.913(1)(d), Florida Statutes. Palm Beach Pharmacy, Inc. (“PBPI”), d/b/a Eddie’s Drug (“Eddie’s”) was, at all times material hereto, a duly contracted Medicaid provider, having entered into a Medicaid Provider Agreement with the Agency and been assigned a Medicaid Provider Number: 106343000. Eddie’s is a Florida licensed pharmacy.1 As an enrolled Medicaid provider, Eddie’s is authorized to dispense drugs and supplies to Medicaid recipients. In return, Eddie’s has agreed to comply with all governing statutes, rules, and policies, including those policies set forth in the Florida Medicaid Prescribed Drug Services Coverage, Limitations and Reimbursement Handbook (the “Handbook”). The Agency, which prepared the Handbook and furnishes it to Medicaid providers, has incorporated the Handbook by reference into Rule 59G-4.250(2), Florida Administrative Code. PBPI, which owned and operated a number of pharmacies (including Eddie’s), maintained its corporate headquarters in West Palm Beach, Florida. Eddie’s was located in Miami, Florida. On July 1, 1998, PBPI acquired a drug store known as Jay’s Drugs (“Jay’s”). Jay’s was located in Miami, Florida, across the street from Eddie’s. Thus, before both stores came under common ownership, they had been competitors. This case arises out of the Agency's attempt to recover alleged overpayments on Medicaid claims for which Eddie’s was paid several years ago. The "audit period" that is the subject of the Agency's recoupment effort is April 1, 1998 to July 31, 1999, although the actual period in controversy is much shorter. From July 1, 1998, until the end of the audit period, PBPI owned and operated both Eddie’s and Jay’s. The Underlying Facts The transactions at the heart of this case occurred between late-August and November of 1998, during which period (the “Focal Period”) Medicaid reimbursed Eddie’s more than $1 million for prescription drugs including Neupogen and Epogen/Procrit (collectively, the “Drugs”). The Drugs are used to treat AIDS patients and persons infected with HIV. Prior to the Focal Period, Eddie’s had not dispensed $1 million worth of the Drugs——or any figure approaching that amount——in three or four months’ time. The reason for the dramatic spike in Eddie’s business is that Eddie’s was dispensing the Drugs to customers of Jay’s pursuant to an arrangement designed to manipulate PBPI’s contractual obligations to the former owner of Jay’s under the purchase and sale agreement by which PBPI had acquired Jay’s. Essentially, the arrangement was this. Jay’s was dispensing the Drugs to a large number (approximately 150) of Medicaid beneficiaries who were receiving treatment at a nearby clinic. Because the Drugs were administered to the patients via intravenous infusion, the clinic typically obtained the Drugs from Jay’s in bulk. To fill these prescriptions, Jay’s ordered the Drugs from a wholesale supplier, which usually delivered the Drugs to Jay’s the next day. At some point before the Focal Period, arrangements were made to have the clinic present its prescriptions for the Drugs to Eddie’s rather than Jay’s.2 The evidence does not show, exactly, how this was accomplished, but whatever the means, the clinic abruptly began bringing prescriptions for the Drugs to Eddie’s.3 This diversion of Jay’s’ business to Eddie’s was intended to deprive Jay’s of Medicaid reimbursements to which Jay’s’ former owner had access as a source of funds for paying down a note that PBPI had given for the purchase of Jay’s. By having Eddie’s dispense the Drugs and submit the Medicaid claims, Medicaid money flowed into Eddie’s’ bank account (rather than Jay’s’ bank account) and hence was not immediately available to the former owner of Jay’s to reduce PBPI’s debt. During the Focal Period, Eddie’s did not purchase the Drugs from a wholesaler but instead acquired them from Jay’s. The process by which this was accomplished involved a pharmacy technician named Wright, who was employed at Eddie’s, and a pharmacist named Shafor, who worked at Jay’s. Wright (at Eddie’s) accepted the prescriptions for the Drugs as the clinic brought them in Then, she called Shafor (at Jay’s) and told him the quantities needed to fill the prescriptions. Shafor ordered the Drugs from a wholesaler, which delivered them in bulk to Jay’s, usually the next day. Upon receiving the Drugs, Shafor personally delivered them to Wright, who, recall, was across the street at Eddie’s. Wright labeled and dispensed the Drugs. Eddie’s submitted a claim for the Drugs to Medicaid, and Medicaid paid Eddie’s. PBPI maintained separate accounting ledgers for Eddie’s and Jay’s, respectively. The company’s accountants recorded the subject transactions in these ledgers so that Jay’s——not Eddie’s——would “recognize” the sales of the Drugs. In a nutshell, this was done through “inter-company” transfers whereby all of the money that Eddie’s received from Medicaid for the Drugs was moved, on the books, into an account of Jay’s. In this way, any profit from the sales of the Drugs (the difference between the wholesale cost of the Drugs and the Medicaid reimbursement therefor, less overhead) was realized on Jay’s’ books.4 The Medicaid payments to Eddie’s that the Agency seeks to recoup were included in four remittance vouchers dated September 2, 1998; September 30, 1998; October 28, 1998; and November 25, 1998, respectively. The September 2 payment to Eddie’s totaled $287,205.52. Of this amount, $276,033.23 reimbursed Eddie’s for dispensing the Drugs. Eddie’s’ accounting ledger reflects that, as of September 30, 1998, the sum of $276,033.23 had been transferred from an account of Eddie’s to an account of Jay’s. The September 30 payment to Eddie’s totaled $439,175.77, of which $432,700.36 was paid in consideration of the Drugs. The October 28 Medicaid payment was $431,753.82, of which total the Drugs accounted for $424,202.76. Eddie’s’ accounting ledger reflects that, as of October 31, 1998, the sum of $870,929.59 (439,175.77 + 431,753.82) had been transferred from an account of Eddie’s to an account of Jay’s. The November 25 payment to Eddie’s totaled $407,088.00. Of this amount, $393,063.00 reimbursed Eddie’s for dispensing the Drugs. Eddie’s’ accounting ledger reflects that, as of November 30, 1998, the sum of $407,088.00 had been transferred from an account of Eddie’s to an account of Jay’s. The Agency’s Allegations On October 31, 2000, the Agency issued its Final Agency Audit Report (“Audit”) in which Eddie’s was alleged to have received $1,143,612.68 in overpayments relating to the Drugs. In the Audit, the Agency spelled out its theory of the case; indeed, the Audit is the only document in the record that does so. The Agency cited several statutory provisions. First, Section 409.913(7)(e), Florida Statutes, was referenced. This section states: When presenting a claim for payment under the Medicaid program, a provider has an affirmative duty to supervise the provision of, and be responsible for, goods and services claimed to have been provided, to supervise and be responsible for preparation and submission of the claim, and to present a claim that is true and accurate and that is for goods and services that: * * * (e) Are provided in accord with applicable provisions of all Medicaid rules, regulations, handbooks, and policies and in accordance with federal, state, and local law. Section 409.913(7)(e), Florida Statutes. The Agency did not allege (or prove), however, that Eddie’s had violated Section 409.913(7)(e), Florida Statutes.5 Put another way, the Agency did not plead or prove lack of supervision, submission of a false claim, or that the Drugs were not provided in accordance with applicable law. Next, the Agency cited Section 409.913(8), Florida Statutes, which provides: A Medicaid provider shall retain medical, professional, financial, and business records pertaining to services and goods furnished to a Medicaid recipient and billed to Medicaid for a period of 5 years after the date of furnishing such services or goods. The agency may investigate, review, or analyze such records, which must be made available during normal business hours. However, 24-hour notice must be provided if patient treatment would be disrupted. The provider is responsible for furnishing to the agency, and keeping the agency informed of the location of, the provider's Medicaid- related records. The authority of the agency to obtain Medicaid-related records from a provider is neither curtailed nor limited during a period of litigation between the agency and the provider. The Agency further alleged, as fact, that Eddie’s had failed, upon request, “to submit invoices from [its] suppliers to substantiate the availability of drugs that [were] billed to Medicaid” and thus had not “fully substantiated such availability.” The Agency, however, did not invoke any of the available remedial provisions as authority to impose a sanction for this alleged failure to turn over Medicaid-related records. See, e.g., Sections 409.913(14)(b), (c), and (d), Florida Statutes. The Agency cited Section 409.913(10), Florida Statutes, which authorizes the Agency to “require repayment for inappropriate, medically unnecessary, or excessive goods or services from the person furnishing them, the person under whose supervision they were furnished, or the person causing them to be furnished.” There was no allegation (or proof), however, that the Drugs which Eddie’s had purported to dispense (i.e. the Drugs for which it had submitted Medicaid claims) were “inappropriate, medically unnecessary, or excessive.” Thus, Eddie’s was not alleged (or shown) to have violated Section 409.913(10), Florida Statutes. Finally, the Agency relied upon Section 409.913(14)(n), Florida Statutes, which is the basis of the Agency’s legal theory. This section provides: The agency may seek any remedy provided by law, including, but not limited to, the remedies provided in subsections (12) and (15) and s. 812.035, if: * * * (n) The provider fails to demonstrate that it had available during a specific audit or review period sufficient quantities of goods, or sufficient time in the case of services, to support the provider's billings to the Medicaid program[.] The Agency contended, additionally, that “[b]illing Medicaid for drugs that have not been demonstrated as available for dispensing is a violation of the Medicaid laws and regulations and has resulted in the finding that [Eddie’s] ha[s] been overpaid by the Medicaid program.” (Emphasis added). The Agency explained, “Medicaid payments that have been substantiated by documented inventory are assumed to be valid; and payments in excess of that amount are regarded to be invalid.” Thus, the Agency’s theory of recovery is that Eddie’s must forfeit “overpayments” arising from its failure to demonstrate the availability, in inventory, of a sufficient quantity of the Drugs for which claims were submitted, as required by Section 409.913(14)(n), Florida Statutes. After the Audit was issued, the Agency accepted a handwritten note regarding the transfer of a small quantity of Drugs from Jay’s to Eddie’s as sufficient to demonstrate the availability of such amount. This resulted in a slight reduction of the amount of the alleged overpayment, to $1,140,763.88. The Separate Audit of Jay’s The Agency conducted a separate audit of Jay’s, concerning which some evidence was introduced at hearing. Without getting into unnecessary detail, the audit of Jay’s revealed that Jay’s had purchased, during and around the Focal Period, a quantity of the Drugs that exceeded the number of units that Jay’s had billed to Medicaid. It was Eddie’s theory that this “excess inventory” of Jay’s matched, more or less, the alleged inventory shortfall at Eddie’s, thereby corroborating the testimony concerning the transfer of these Drugs from Jay’s to Eddie’s for dispensation. At hearing, the parties sharply disputed whether, in fact, Jay’s had transferred the Drugs to Eddie’s. The Agency, of course, maintained that such transfers were not properly documented; Eddie’s argued that the documents and other evidence, including testimony about the transactions in question, adequately demonstrated that the transfers had, in fact, occurred. There was no dispute, however, that if it were found that such transfers had occurred, and if, further, the documents (and other evidence) pertaining to the inventory of Jay’s were accepted as proof of the quantities of Drugs so transferred, then all but $176,078.30 worth of the Drugs could be accounted for. Thus, as counsel for Eddie’s conceded at hearing, the Agency is entitled to recoup some sum of money. The question is whether that sum is $1,140,763.88 or $176,078.30. Ultimate Factual Determination Based on all of the evidence in the record, including the deposition testimony received through the parties’ joint stipulation, it is determined that, more likely than not, Eddie’s had available during the Focal Period a sufficient quantity of the Drugs to support all but $176,078.30 worth of the claims in dispute.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Agency enter a final order requiring Eddie’s to repay the Agency the principal amount of $176,078.30. DONE AND ENTERED this 12th day of March, 2002, in Tallahassee, Leon County, Florida. JOHN G. VAN LANINGHAM Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 12th day of March, 2002.
The Issue These two consolidated cases are both license discipline cases in which the Petitioner seeks to take disciplinary action against an individual pharmacist and a community pharmacy for various statutory violations which are alleged in separate Administrative Complaints. At the hearing the Respondents admitted some of the allegations of the Administrative Complaints. Thereafter both the Petitioner and the Respondents presented testimony and exhibits. At the conclusion of the hearing, the parties decided not to order a transcript of the hearing. The parties were allowed until November 25, 1987, within which to file their proposed recommended orders. Both parties filed timely proposed recommended orders containing proposed findings of fact and conclusions of law. Specific rulings on all proposed findings of fact submitted by the parties are contained in the Appendix which is attached to and incorpor- ated into this recommended order.
Findings Of Fact Based on the stipulations and admissions of the parties, on the exhibits received in evidence, and on the testimony of the witnesses at hearing, I make the following findings of fact. Findings based on stipulations and admissions Respondent Gus Goldstein is, and has been at all times material hereto, a pharmacist in the State of Florida, having been issued license number PS 0005354. Respondent's last known address is 110 East Adams Street, Jacksonville, Florida 32202. Respondent Gus Goldstein is and has been at all times material hereto, designated as the prescription department manager of Center Pharmacy, a community pharmacy in the State of Florida, having been issued permit number PH 0002430 and located at 110 East Adams Street, Jacksonville, Florida 32202. On or about December 23, 1986, a pharmacy medication audit was conducted at Center Pharmacy for the period between approximately June 1, 1986, and December 23, 1986. That audit revealed that the Respondents' records for the period of June 1, 1986, through December 23, 1986, failed to account for the following: Description Bought Dispensed Unaccounted For Tylenol #3 w/codeine 4200 2102 2098 Tylenol #4 w/codeine 5000 2600 2400 Fiorinal #3 1900 1810 90 Valium 5mg. 900 380 520 (Diazepam 5mg.) Valium 10mg. 2200 1600 600 (Diazepam 10mg.) Tylenol #3 with Codeine and APAP with Codeine 30mg are "medicinal drugs" as defined in Section 465.003(7), Florida Statutes, which contain codeine, a controlled substance, in such quantity that they are included in Schedule III of Chapter 893, Florida Statutes. Tylenol #4 with Codeine and APAP with Codeine 60mg are "medicinal drugs" as defined in Section 465.003(7), Florida Statutes, which contain codeine, a controlled substance, in such quantity that they are included in Schedule III of Chapter 893, Florida Statutes. Fiorinal #3 with Codeine is a "medicinal drug" as defined in Section 465.003(7), Florida Statutes, which contains codeine, a controlled substance, in such quantity as to be included in Schedule III of Chapter 893, Florida Statutes. Valium is a brand name of a "medicinal drug" as defined in Section 465.003(7), Florida Statutes, which contains diazepam, a controlled substance, which is listed in Schedule IV of Chapter 893, Florida Statutes. Tylenol #3 with Codeine is a brand name of a "medicinal drug" as defined in Section 465.003(7), Florida Statutes, which contains a sufficient quantity of codeine, a controlled substance, to be listed in Schedule III of Chapter 893, Florida Statutes. Respondent Center Pharmacy is, and has been at all times material hereto, the permittee of Center Pharmacy, a community pharmacy, located in the State of Florida at 110 East Adams Street, Jacksonville, Florida 32202, having been issued permit number PH 0002430. Respondent Center Pharmacy has, and had at all times material hereto, Gus Goldstein, a pharmacist in the State of Florida having been issued license number PS 0005354, designated as its prescription department manager. Respondent Center Pharmacy is, and has been at all times material hereto, registered with the United States Drug Enforcement Administration. Respondent has been issued certificate of Registration Number AC 5050719. Findings based on the evidence adduced at the hearing On or about October 27, 1986, Respondent Gus Goldstein created a record which purported to be a telephone prescription (#116-450) for F.W. for Tylenol #3 with Codeine, purportedly prescribed by Dr. Samuel J. Alford, M.D. The prescription (#116-450) for F.W. for Tylenol #3 with Codeine was not authorized by Dr. Samuel J. Alford, M.D. Respondent Gus Goldstein dispensed Tylenol #3 with Codeine to F.W. without first being furnished with a prescription. Respondent Gus Goldstein knew that the purported telephone prescription (#116-450) for F.W. was a false record. During the process of dispensing drugs, normally there will be small errors in the counting of the drugs. These small errors will result in shortages in the drug inventory which cannot be accounted for. If proper record-keeping and dispensing practices are followed, the shortages resulting from these small errors normally will be in the range of from 1 percent to 2 percent of drugs dispensed; certainly no more than 3 percent of drugs dispensed. Shortages greater than 3 percent of drugs dispensed are indicative of a failure to follow proper record- keeping and dispensing practices.
Recommendation Based on all of the foregoing, I recommend that the Board of Pharmacy enter a final order in these consolidated cases to the following effect: Finding the Respondent Gus Goldstein guilty of the violations charged in Counts One, Two, and Three of the Administrative Complaint in Case Number 87-3151; Dismissing the violation charged against Gus Goldstein in Count Four of the Administrative Complaint in Case Number 87- 3151; Imposing an administrative fine against Gus Goldstein in the amount of five hundred dollars ($500.00) for each of the violations of which he is found guilty; i.e., administrative fines totaling fifteen hundred dollars ($1,500.00); Revoking Gus Goldstein's license to practice pharmacy; Finding the Respondent Center Pharmacy guilty of the violation charged in the Administrative Complaint in Case Number 87-3913; Imposing an administrative fine against Respondent Center Pharmacy in the amount of five hundred dollars ($500.00); and Revoking the permit of Center Pharmacy. DONE AND ENTERED this 9th day of December, 1987, at Tallahassee, Florida. MICHAEL M. PARRISH, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 9th day of December, 1987. APPENDIX TO RECOMMENDED ORDER, CASE NOS. 87-3151 AND 87-3913 The following are my specific rulings on all of the findings of fact proposed by the parties. In the rulings which follow I have rejected much of what both parties offered as proposed findings of fact due to the form of the proposals. The most frequent defect in the form is the commencement of a statement with the words "So-and-so testified," followed by a summary of the testimony. Testimony is, of course, one of the raw materials from which findings of fact are made, but (with the exception of perjury trials) summarization or quotation of testimony is hardly ever an appropriate finding of fact. Rather than summarize or quote the testimony, the parties should refine from the testimony the essential material and relevant facts and submit that refined product as their proposed findings. Findings proposed by Petitioner: Paragraph 1: Accepted. Paragraph 2: Rejected for the following reasons: First, it is a summary of testimony, rather than proposed findings of fact; second, parts of it are inconsistent with the greater weight of the evidence; and, third, most of it consists of subordinate, irrelevant, or unnecessary details. First unnumbered paragraph following Par. 2: Rejected for the first and third reasons noted immediately above. Second unnumbered paragraph following Par. 2: Rejected as a commentary on the evidence rather than a proposed finding of fact. Further, the portion following the comma is inconsistent with the greater weight of the evidence. Paragraph 3: Rejected for the same reasons as rejection of Paragraph 2. Unnumbered paragraph following Par. 3: Rejected for the following reasons: First it is a summary of the testimony, rather than proposed findings of fact, and, second, most of it consists of subordinate, irrelevant, or unnecessary details. Paragraph 4: Rejected as constituting a summary of testimony rather than proposed findings of fact. Last unnumbered paragraph: Rejected as constituting argument or conclusions of law rather than proposed findings of fact. Findings proposed by Respondents: Paragraph 1: Accepted. Paragraph 2: Covered in part by stipulated facts. Most of the remainder rejected as subordinate or unnecessary details or as not supported by competent substantial evidence. First unnumbered paragraph following Par. 2: First three sentences rejected as summary of testimony rather than proposed findings of fact. Second and third sentences also rejected as not being supported by persuasive competent substantial evidence. The remainder of this paragraph is rejected as consisting of subordinate, irrelevant, or unnecessary details. Second unnumbered paragraph following Par 2: Rejected as constituting a summary of testimony rather than proposed findings of fact and because it constitutes subordinate, irrelevant, or unnecessary details. Paragraph 3: Rejected as irrelevant and as not supported by competent substantial evidence. First unnumbered paragraph following Par. 3: Rejected as constituting argument or legal conclusions rather than proposed findings of fact. Second unnumbered paragraph following Par. 3: Rejected as constituting argument or legal conclusions rather than proposed findings of fact. Further, portions of the arguments and conclusions are based on inferences which are not warranted by the evidence. Paragraph 4: Rejected as summary of testimony rather than proposed findings of fact and as constituting subordinate and unnecessary details. First unnumbered paragraph following Par. 4: Rejected for the same reasons as rejection of Paragraph 4. Second unnumbered paragraph following Par. 4: First sentence rejected as constituting argument rather than proposed findings of fact. Second sentence accepted in substance. Last sentence accepted. COPIES FURNISHED: Mr. Rod Presnell Executive Director Board of Pharmacy 130 North Monroe Street Tallahassee, Florida 32399-0750 William O'Neil, Esquire General Counsel Dept. of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 Michael A. Atter, Esquire 333-1 East Monroe Street Jacksonville, Florida 32202
The Issue The issues to be determined here concern disciplinary action to be taken against Respondent for those administrative offenses pertaining to the controlled substances Talwin, Dilaudid and Paregoric dispensed by Scottie Drug Store in Duval County, Florida, during the period April 2, 1981, to March 23, 1982, in violation of various provisions of Chapter 465, Florida Statutes. These contentions made by the State of Florida, Department of Professional Regulation, are more particularly described in the Administrative Complaint, DPR Case No. 0022146.
Findings Of Fact Howard E. Staats is a pharmacist who has been issued a license by the State of Florida, Department of Professional Regulation, Board of Pharmacy. The license number is 0007704. At times relevant to this proceeding, Staats, practiced pharmacy in Jacksonville, Florida. At all times pertinent to the Administrative Complaint, which is the focus of this action, Staats was the managing pharmacist at American Apothecaries, Inc., which does business as Scottie Drug Store at 41 Arlington Road South, Jacksonville, Florida. A copy of Respondent's most recent license may be found as Petitioner's Exhibit No. 1, admitted into evidence. Petitioner's Exhibit No. 2, admitted into evidence, is a copy of the permit for American Apothecaries. Sometime within the period March 23, 1982, through March 29, 1982, an audit was conducted at the Scottie Drug Store. The audit revealed that in the period April 2, 1981, through March 23, 1982, the drug store had purchased 66,900 tablets of Talwin, 50 mg., had sold 29,373 tablets of that drug, had lost by robbery or theft, 1,000 tablets of the drug, leaving 36,527 tablets of Talwin unaccounted for. During that same audit period, the pharmacy purchased 4,000 tablets of Dilaudid, 4 mg., selling 3,025 tablets of that drug, losing by robbery or theft, 200 tablets of the drug and failing to account for 775 tablets of the drug. Finally, during the audit period, 2,064 ounces of Paregoric had been purchased and 699 ounces sold, with the remaining amount of 1,285 ounces being unaccounted for. See Petitioner's Exhibit No. 4. Talwin is a Schedule IV controlled substance within the meaning of Chapter 893, Florida Statutes. Dilaudid is a Schedule II controlled substance within the meaning of Chapter 893, Florida Statutes. Paregoric is a Schedule III controlled substance within the meaning of Chapter 893, Florida Statutes. The audit which was conducted at the Scottie Drug Store revealed numerous prescriptions for the controlled substance Talwin, 50 mg., written on prescription blanks of Drs. W. W. Shell, Jr., and L. T. McCarthy, Jr., which had allegedly been signed by those physicians, when in fact the patients for whom the prescriptions were written were unknown to the physicians and the signatures of the physicians were forgeries. Those prescriptions are depicted in Petitioner's Exhibit No. 5, admitted into evidence. During the period covered by the audit, it was shown that Staats filled a number of prescriptions for various patients for the controlled substance Talwin, which had been written on prescription pads of Methodist Hospital and Baptist Medical Center in Jacksonville, Florida, and signed by individuals who are not physicians having hospital privileges at those medical centers nor practicing as physicians in the Duval County area. Copies of those prescriptions may be found as Petitioner's Exhibit No. 6, admitted into evidence. In the course of the time sequence related to the audit review process, it was discovered that Staats had refilled numerous prescriptions for controlled substances on more occasions than had been authorized by physicians, namely prescription No. 51632 was refilled twice although the physician indicated there were to be no refills; prescription No. 51579 was refilled once although the prescription indicated there should be no refills; prescription No. 51639 was refilled twice although the prescription indicated there should be no refills; prescription No. 51217 was refilled once although the prescription indicated there should be no refills; prescription No. 51238 was refilled once although the prescription indicated that there should be no refills; prescription No. 53010 was refilled once although the prescription indicated that there should be no refills; prescription No. 53597 was refilled four (4) times although the prescription indicated that it should only be refilled once; prescription No. 53537 was refilled once although the prescription indicated that it should not be refilled; and prescription No. 53592 was refilled twice although the prescription indicated that there should be no refills. Petitioner's Exhibit No. 7, admitted into evidence, is copies of prescriptions spoken to in this paragraph. Respondent Staats had operated the Scottie store under a lease arrangement during 1979 and 1980, and in January of 1981, took a position as an active pharmacist in that store. After becoming the principal operating pharmacist in the Scottie store, Staats began to receive prescriptions from doctors Shell and McCarthy for the substance Talwin and when a prescription purportedly written by those physicians was in question, Staats would call the office of the physicians for confirmation, which at times would be given over the phone and at other times an indication was made that a call back from the physician's office to Staats would be necessary. Some of the indications of physicians' prescription authority of the substances in question would be placed on a separate log and not on the back of the prescription and on other occasions, the note of the prescription information would be placed on the back of the prescription form and not in the log. Normally, this information would be reflected both in the log and on the back of the prescription. There were occasional circumstances in which the authority was not stated in either place. At approximately the same time as was covered by the audit, Staats began to ask for identification from customers who were seeking prescriptions for Talwin and noted that the demand for that substance declined with the advent of the request for identification. Staats posted a notice in the window of the pharmacy to the effect that state law imposed a fine of $5,000.00 or might cause incarceration for five (5) years for presenting forged prescriptions or conspiring or agreeing with another to have a forged prescription filled. On two (2) occasions Staats called law enforcement officials on a circumstance involving suspect prescriptions and those persons were apprehended. (Poor record keeping and mistakes in estimating the amount of losses due to a robbery and a larceny which occurred in the period covered by the audit contributed to the unaccounted for controlled substances, but those matters of record keeping and theft reports would cause only a slight differential in the disparity, as opposed to explaining the whereabouts of a substantial portion of the missing controlled substances.) Beginning on March 25, 1982, Staats began to keep a daily inventory log on the substance Talwin and a number of other controlled substances. A copy of that log may be found as Respondent's Exhibit No. 9, admitted into evidence. In addition, certain out-of-date and otherwise undesirable controlled substances, Schedules II, III and IV, have been removed from inventory and turned over to appropriate authorities for destruction.
Recommendation That a final order be entered placing Respondent Staats on probation for a period of two (2) years, with a special requirement that Staats attend continuing education courses dealing with the proper methods for prescribing controlled substances and to the extent possible, courses which emphasize the detrimental effect to the public when those controlled substances are abused and requiring that Respondent work under the supervision of another pharmacist for the first six (6) months of his probationary period. DONE and ENTERED this 17th day of November, 1982, in Tallahassee, Florida. CHARLES C. ADAMS Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 17th day of November, 1982.
The Issue The issues to be resolved in this proceeding concern whether the Respondent properly maintained and supplied required records to support and document prescription claims, which it billed to Medicaid and for which it received payment from the Medicaid program during the audit period of April 1, 2000 through December 31, 2001. If that is not the case, it must be determined whether the Agency is entitled to recoup from the Respondent the sum it seeks of $108,478.77, as the purported amount overpaid to the Respondent by the Agency. It must also be determined whether the applicable laws and regulations referenced herein were complied with by the Respondent, in terms of its accepting and filling prescriptions, dispensing relevant drugs, and recording and documenting such activities in its pharmacy records. Finally, it must be determined whether the statistical methodologies employed by the Agency, through its audit and investigation of the Respondent, were sufficiently representative and accurate so as to support the calculation of estimated overpayments.
Findings Of Fact The Petitioner is an Agency of the State of Florida charged by the statutes and rules referenced herein with ensuring that proper reimbursement is effected to providers, including pharmacies, by the Medicaid system. Because of its duty to enforce and regulate the Medicaid system, the Petitioner Agency has an audit and oversight function, as well as an enforcement function, to ensure that Medicaid payments and the general operations of the Medicaid system are carried out correctly. It is through this duty imposed by the cited Florida Statutes and rules, as well as the federal regulations it is charged with enforcing, that the Petitioner carried out an audit of the Respondent, Brown Pharmacy, concerning the audit period of April 1, 2000 through December 31, 2001. The Petitioner conducts audits of providers such as Brown in order to ensure compliance with the Medicaid provisions and Medicaid provider agreements. These are called "integrity audits" and are routinely performed by auditors contracted from private firms such as Heritage. Brown Pharmacy (Brown) is licensed in the State of Florida as a pharmacy (license Number PH562). Brown maintained a business location at 312 West 8th Street, Jacksonville, Florida 32206, at times pertinent to this case. During the audit period Brown was an enrolled Medicaid provider authorized to provide Medicaid prescriptions pursuant to a provider agreement with the Agency. The terms of the provider agreement governed the contractual relationship between Brown and the Agency. Pursuant to that provider agreement, Brown was to maintain the Medicaid-related records and documentation for at least five years. Any Medicaid provider, such as Brown, not in compliance with the Medicaid documentation and record retention policies may be subject to the recoupment of Medicaid payments. During the audit period, Brown dispensed prescription drugs to Medicaid recipients. Medicaid claims were filed and paid electronically as "point of sale" transactions during the audit period. Each claim reviewed and at issue in this case was a paid Medicaid claim subject to the provider agreement and pertinent regulations. As a condition of participating in the Medicaid program, a Medicaid provider must comply with all provisions of a provider agreement, which is a voluntarily agreement between the Agency and the provider. Those provisions include the provider's agreement to comply with all relevant local, state and federal laws, rules, regulations, licensure laws, bulletins, manuals, and handbooks, etc. The provider must agree to keep and maintain, in a systematic and orderly manner, all Medicaid- related records as may be required by the Agency and make them available for state and federal agencies and review. It must maintain complete and accurate medical, business, and fiscal records that will justify and disclose the extent of goods and services rendered to customers or patients and rendered as billings to the Medicaid system. Florida Administrative Code Rule 59G-4.250 promulgates, as part of the rule, the above-referenced handbook (handbook) which sets out Medicaid polices and rules. The polices and rules govern the rights and responsibilities of drug providers, such as Brown, including coverage and payment methodologies for services and goods rendered to Medicaid recipients and billed to the Medicaid program. The types of records that must be maintained are as follows: Medicaid claim forms, professional records such as patient treatment plans, prior and post authorization information, prescription records, business records, including accounting ledgers, financial statements, purchase and acquisition records etc., tax records, patient counseling information and provider enrollment documentation. Providers who are not in compliance with the Medicaid documentation and record retention policies described in the handbook are subject to administrative sanctions and/or recoupment of Medicaid payments. Medicaid payments for services that lack required documentation and/or appropriate signatures will be recouped. Chapter five of the handbook, in defining overpayment provides that any amount not authorized to be paid by the Medicaid program, whether paid as a result of inaccurate or improper cost reporting, improper claims, unacceptable practices, fraud, abuse or mistake, constitutes overpayment. Incomplete records are records that lack documentation that all requirements or conditions for the providing of services have been met. Medicaid may recoup payments for services or goods when the provider has incomplete records or cannot locate the records. The Agency contracted with Heritage to conduct an on- site audit at Brown. The audit was conducted March 18th through March 20, 2002. Heritage isolated a sample of 205 prescription claims, known as the "judgmental sample" out of a total universe of paid pharmacy claims from Brown totaling 16,727 for the audit period. Heritage also selected 250 random prescription claims out of the remaining total universe of paid pharmacy claims of 16,522, which remained after the 205 judgmental sample claims had been removed or isolated from the remainder of the total claims. With the acquiescence of the Agency, Heritage chose the 205 claims by weighing it in favor of the "high dollar" or more expensive drug prescriptions. Those prescriptions are primarily for HIV and Aids therapy drugs and psychotherapeutic drugs for various mental conditions, including schizophrenia. Weighing of the judgmental sample strongly in favor of the high dollar prescription claims would seem to render the judgmental sample fundamentally unfair against Brown if the judgmental sample had then been extrapolated to the entire universe of claims ($16,727). This was not done, however. The judgmental sample was audited and compiled by doing an actual count and totaling of claim amounts in dollars represented by all the discrepant prescriptions, including all those the Agency and Heritage maintained resulted in "overpayments" to Brown. Therefore, the judgmental sample is an actual number rather than an extrapolated calculation so that weighing the sample in favor of the high dollar prescriptions does not result in an unfair or biased sample, as to the judgmental sample. Because the judgmental sample was drawn from the total pool of audited claims and removed from that claim pool prior to the identification and drawing of the random sample, the two are mutually exclusive and the amounts calculated do not represent a duplication or overlap. Thus the findings from the judgmental sample and then the random sample may be properly added together. The randomly selected claims (random sample) were taken of the remaining 16,522 claims in the audit claim pool after the judgmental sample of 205 claims had been removed. According to the report rendered by Heritage, the 250 randomly selected claims totaled $10,632.59 in paid Medicaid dollars. The Heritage auditors determined that there were 56 discrepant claims out of these which totaled, according to their calculation, $2,450.13 in apparent overpayments. This resulted in an average overcharge per claim of $9.80 (determined by dividing the documented "sanction amount" by the total number of claims in the random sample (250), multiplied by the universe of claims from which the random sample was taken (16,522) which yielded an extrapolated overcharge of $161,924.19. Applying the statistically appropriate 95 percent "one-sided" lower confidence limit of this extrapolation resulted in a purported overpayment extrapolated from the randomly selected claims of $102,700.85. This means that the overpayment amount calculated by Heritage represents an amount statistically 95 percent certain to be the lowest amount overpayment based on the extrapolation of the overpayment represented in the 250 randomly selected claims. The non-extrapolated judgmental findings showed, according to Heritage, that there were 72 discrepant claims. Heritage then determined that, of these, there were $29,381.09 in apparent actual overcharges. The discrepancies determined by Heritage involved the failure to produce documentation of refill authorizations for 80 prescription claims; 31 prescription claims containing an incorrect Medicaid provider number; the failure to produce 12 "hard copy" prescriptions representing 25 claims; four claims that did not have the prescriber's DEA number on the prescription for controlled substances; three claims for prescriptions that did not contain the original date of service; two claims that were billed for quantities greater than that authorized by the physician; one claim that was billed for an incorrect day's supply; one claim that was billed in excess of the maximum allowable quantity of prescription of the drug, set by Medicaid policy; and one prescription claim that was billed for an incorrect prescriber's Medicaid provider number (although this should not be a discrepancy because the correct prescriber was documented in the pharmacy's computer, which the regulations allowed). Additionally, there was one claim billed for a drug different than that prescribed by the physician, according to Heritage in its report. Heritage also conducted an invoice review using utilization reports provided by the Respondent. This was apparently a review of 25 different drugs that purportedly showed that the prorated purchases of those drugs were insufficient to cover the number of units billed to Medicaid for all 25 drugs reviewed, and thus yielded a purported shortage of $87,942.13, representing the amount billed to Medicaid above the amount the records of purchases from suppliers proved that Brown had purchased of those drugs. Based upon the Heritage audit as well as documentation findings and overpayments calculations (see Exhibit 8), the Agency issued a PAAR dated September 27, 2002, determining that Brown had been overpaid $150,036.71 for Medicaid claims during the audit period. That report advised Brown that it was a provisional report only and encouraged Brown to submit any additional information or documentation which might serve to change the overpayment. The report listed examples of documentation that the Agency would consider for a possible reduction in the overpayment amount initially claimed. Thereafter, the Agency agreed to an extension of time for Brown to submit additional documentation and sent a letter to Brown dated October 31, 2003, advising that the audit had been placed in abeyance pending the outcome in a related case, but that the Agency expected to resume the audit and that therefore all Medicaid-related records and documentation regarding paid claims should be maintained and preserved until the audit was finalized. The FAAR was addressed in the testimony of Ms. Stewart for the Agency. Through her testimony it was revealed that certain corrections should be made to the FAAR updating it from the findings in the Heritage initial audit report. The Agency corrected the information in the FAAR for this reason and for the reason that it secured some additional information from the Respondent. Thus, for the audit period it was established that there were 16,727 total claims for prescriptions dispensed by Brown, for which it was paid $795,564.59 during the 21-month audit period, of those claims, 205 were pulled out from the total universe of claims as the judgmental sample. There were some 72 allegedly "discrepant claims" totaling $36,393.51 in dollars paid to Brown. The Agency's position is that $29,381.09 of those are so called "documented overcharges." The random sample of 250 claims was extrapolated to the remaining universe of 16,522 prescription claims. The Agency now takes the position that it found 49 "discrepant claims" in the random sample which totaled $2,154.40 in dollars paid to Brown's pharmacy and of that it maintains that $1,927.55 are "documented overcharges" for the 250 randomly selected claims (for which Brown had been paid $10,632.59). Thus the Agency found an average overcharge for the 250 randomly sampled claims of $7.71 per claim. The $7.71 average per claim overcharge was then multiplied by the remaining universe of 16,522 claims, yielding an extrapolated purported overcharge of $127,387.92. The Agency then applied the 95 percent "one-sided lower confidence limit" to this extrapolation, that is, that it or its statistician, Dr. Johnson, felt that there was a 95 percent chance that the lower confidence limit number it calculated was accurate. That number is $79,097.68. When that number is combined with the Agency's position as to overcharges from the judgmental sample results in a total postulated overcharge of $108,478.77. This is the final amount the Agency claims as an overpayment that must be recouped for Medicaid. The FAAR summarized the discrepant claims for the judgmental sample as follows: 61 claims involve refills which exceeded the authorized number of refills without documentation of reauthorization; 10 claims showed an incorrect prescriber license number but the correct prescriber license number was documented in the pharmacy's computer; and For two claims the hard copy description did not have an original date of service depicted on it and did not reference a DEA number. The discrepant claims shown in the FAAR as to the random sample were as follows: There were 19 claims for refills without documentation of refill authorization (refills had been previously authorized, but for the 19 claims at least one refill had been issued beyond the authorization limit); Fifteen claims showed an incorrect prescriber license number on the claim and the license number was not documented in the Respondent's computer; Seven claims showed an incorrect prescriber license number, but the correct license number was documented in the pharmacy's computer; There were seven claims for which the original hard copy prescriptions could not be found on file during the audit period; For one claim the hard copy prescription did not have an original date of service or DEA number; For one claim the quantity paid exceeded the quantity authorized by the prescriber or dispensed to the recipient; and For one claim the number of days supply submitted by the pharmacy was not consistent with the quantity and directions of the prescriber and the quantity exceeded the limit set by the plan. The most common discrepancies with regard to the judgmental sample and the random sample occurred when the Respondent billed refills in excess of the number authorized by the prescriber, without any written authorization for such being provided in the audit process or later. Concerning the random sample, the second most common discrepancy occurred when the claim depicted an incorrect precriber number on the claim and the license number of the prescriber was not documented in the computer. In the judgmental sample the second most common discrepancy occurred when the claim showed an incorrect prescriber number, but the correct prescriber number was documented in the pharmacy's computer. The discrepancies in the FAAR with the indication "UR", references "unauthorized refills." The records of the pharmacy showed that Brown issued refills of prescriptions to Medicaid recipients in excess of the presriber's limit depicted on the prescriptions but showed no written record of a telephonic or written authorization by the prescriber allowing the additional refill or refills. It is also true that as to some or even many of these the Respondent may have obtained verbal authorization, but failed to document that re- authorization. Medicaid policy, the statutory authority cited herein, and the PDSCLR Handbook provide that all verbal orders authorized by the prescriber of a prescription must be recorded either as a "hard copy" or noted in the pharmacy's computer in order to comply with the relevant law cited herein, for record- keeping and auditing purposes under Medicaid policy. The Agency's Statistical Methodology Mark E. Johnson, Ph.D., testified on behalf of the Petitioner. He was qualified as an expert witness in the area of statistical formulas, statistical methodology, and random sampling, including the random sample statistical methodology employed by the Agency in determining the overpayment amount. He is a professor of statistics at the University of Central Florida. Dr. Johnson reviewed the statistical methodology, numbers and calculations arrived at by the Agency and its extrapolation method of arriving at the overpayment amount. He also used his own independent analysis based upon a software package he commonly uses in the practice of his discipline in testing the methodology employed by the Agency and the random sample employed by the Agency and Heritage. The statistical formula employed by Dr. Johnson and the Agency is a standard one routinely used in Dr. Johnson's profession and statistical sampling. He established through his own testing of the methodology that the random sample was appropriate for Medicaid program integrity audits and determinations as employed in this case. The random sampling, according to Dr. Johnson, was employed because it would be time and cost prohibitive to examine individually each of 16,522 claims regarding overpayment issues. The random sampling methodology using 250 randomly chosen samples is a time and cost saving device and yet still presents a "plausible estimate" as established by Dr. Johnson. He established that for the universe of 16,522 claims which were subjected to the random sample and extrapolation statistical analysis and calculation, that such is a reasonable sample for purposes of this audit and that the 250 random samples employed by the Agency are indeed statistically appropriate random samples. His calculation of overpayment was at variance with the Agency's by 55 cents. He established that is not a significant difference since the 95 percent certainty limit of $79,097.68 for the random sample extrapolation analysis is so much lower than the estimate established at $108,478.22. Dr. Johnson established that the Agency had employed appropriate and valid statistical methods in its determination of the above-referenced overpayment amount based upon the random sample of paid claims. The expert testimony of Dr. Johnson, together with his written report in evidence, is credible and persuasive as to the validity of the random sampling of the claims during the audit period and as to the random sample portion of the analysis employed in arriving at the final overpayment calculation and numbers depicted in the FAAR. Dr. Johnson established the appropriateness of the statistical formula, including extrapolation, used to calculate the overpayment amount, the appropriateness of the sample size relative to the universe of claims, and the improbability that the overpayment amount is attributable to chance causes alone. Thus Dr. Johnson's testimony is accepted as credible and persuasive in establishing the validity of the Agency's method of overpayment calculation, and the overpayment calculation in conjunction with the statistical evidence in this record, except as modified by the findings below.1/ The Respondent's Position Gary Steinberg testified on behalf of the Respondent, Brown Pharmacy. He was accepted as an expert witness in the areas of Medicaid policy, audits and pharmacy practice, including Florida pharmacy practice. Mr. Steinberg acknowledged that Brown had not properly documented all claims that had been paid by the Medicaid program nor maintained all required records. He emphasized in his testimony, however, that Brown had not fraudulently billed the Medicaid program with claims for prescription medications that it had not actually dispensed to the patients or recipients. Rather, all medications involved in the subject prescription claims had actually been dispensed. There is no evidence or claim on the part of the Agency that Brown charged and collected more than the appropriate approved price for the prescriptions at issue. Through the explanation given in his testimony, Mr. Steinberg opined that although Brown was guilty of technical errors in record keeping and documentation as to the prescriptions involved in the subject claims, Brown had made substantial compliance with the Medicaid program requirements of the Medicaid provider agreement and the statutes and rules at issue and policies embodied in the subject handbook. He explained in his testimony that in the pharmacy practice setting in which Brown has operated, whereby it serves a large indigent population in an inner city environment, it is difficult to contact a prescriber at the time when a patient needs a critical prescription refilled in order to get a refill authorization. The prescriptions at issue mostly involve critical medications for HIV/Aids and psychotropic medications for severe mental conditions such as schizophrenia. The patients who need these critical medications (and there are very few patients, since most of the procedures involve filling and refilling for a small number of such recipients) are patients of clinics operated at the nearby university hospital (Shands). In these circumstances, where the patient literally needs the HIV/Aids medication refilled on an immediate basis, possibly even to prevent death, and the mental health patient critically needs a refill in order to prevent harm to the patient or harm to the members of the public if the patient goes without medication and "decompensates," the ethical thing for a pharmacist to do is to refill the prescription and seek authorization later. Mr. Steinberg established that it is often difficult to obtain authorization from the original prescriber since the medication were prescribed by residents practicing in the various clinics at the Shands Hospital and that the residents can not always be identified or contacted easily since they do not maintain a fixed medical practice in the area. Consequently, some of the prescriptions were not documented as to authorization, although in some cases the pharmacy actually obtained authorization and entered it in its computer. In some cases, being unable to obtain re-authorization from the resident who originally prescribed the medication the pharmacy used the DEA license or prescribing number of the hospital itself. He explained that although under the law a pharmacy can refill a prescription on an emergency basis for up to a 72-hour supply, that this is generally impracticable and unsafe for patients in this plight because such indigent, mental health and HIV/Aids patients tend to be non-compliant with their medication regimes quite often anyway, and it is often unreasonable to expect them to return to the pharmacy for another refill within two or three days. He thus opined that the ethical and safe thing for the pharmacist to do was to refill and re-dispense the medical approved medication for up to a 30 or 34-day supply (the normal refill supply duration). He further explained that the Shands Hospital license number was used in some of these circumstances because the resident doctor who originally issued the prescription could not be identified on the Shands Hospital prescription forms and because the resident doctors at the Shands clinics only have and can use Shands Hospital prescription forms in any event. Mr. Steinberg thus established that 35 percent of those prescription claims classified as "WMP," that is the prescription claims contained an incorrect prscriber license number were for these reasons and the pharmacist could only use the Shands Hospital license number because the resident could not be identified from the Shands Hospital prescription forms. He thus opined that 35 percent of the random sample extrapolation amount, the 95 percent statistical confidence limit amount of $79,097.00, should be deleted from that amount in determining the correct amount of overpayment predicated on the random sample. Likewise, with regard to the judgmental sample concerning the HIV/Aids and mental health patient prescriptions and related claims, he opined that, in effect, $19,500.00 of the total $29,381.09 overpayment amount claimed by the Agency pursuant to the judgmental sample portion of the claims, should be deleted from that portion of the overpayment claim by the Agency; this is a result of his explanation regarding "substantial compliance" in the critical refill situation he described concerning the HIV/Aids and mental health patients and their prescription drugs. The preponderant, persuasive evidence does establish (and indeed the Agency acknowledged in its Proposed Recommended Order) with regard to the judgmental sample, that 10 of the claims at issue listed an incorrect prescriber license number, but that the correct prescriber license number was actually documented in the pharmacy's computer record with the name of the prescriber. This circumstances comports with the law referenced below and in the Petitioner's Proposed Recommended Order. This results in a reduction in the overpayment claim with regard to the judgmental sample of 13.88 percent of the judgmental sample claims or a reduction of $4,078.09. Likewise, with regard to the random sample extrapolation calculation of overpaid claims, the preponderant, persuasive evidence, also as acknowledged by the Agency in its Proposed Recommended Order, disclosed that seven claims listed an incorrect prescriber license number on the claims, but had been correctly documented in the pharmacy's computer system and therefore were in compliance with the relevant statutes, rules, and the subject handbook. Thus the discrepant claims and the overpayment amount related to the random sample portion of the audit claims should be reduced by 14.28 percent of the total amount of $79,097.00 for a $11,295.05 reduction of that $79,097.00 random sample overpayment amount. Mr. Steinberg demonstrated that Brown was not overcharging on the drugs prescribed and dispensed and was charging the Medicaid-authorized amount for the drugs involved in the prescription claims at issue. The Agency is not claiming that there was any fraudulent practice or illegal overcharging for the prescriptions involved. In fact, Brown was earning only a very small profit on the drugs dispensed that are the subject of the prescription claims at issue. Mr. Steinberg thus opined that since Brown did indeed dispense all the drugs at issue and was only paid the legal authorized amounts for the drugs and prescriptions at issue that recoupment of the amounts sought by the Agency or, in effect, established in these findings of fact, would be fundamentally unfair. He and the Respondent contend, rather, that since Brown performed substantial compliance, but was guilty of technical non-compliance with the relevant rules, agreement, and Medicaid policy, that the Agency should impose a lesser fine instead of seeking recoupment. In summary, in view of the preponderant persuasive evidence establishing the above facts, it has been shown that the documentation and record-keeping, dispensing errors, and omissions in the manner found above, with regard to the prescription claims and types of claims addressed in the above findings of fact, occurred. If those deficiencies amount to violations of the authority cited and discussed below which justify recoupment, then the amount of overpayment established by the above findings of fact is $93,104.95.
Recommendation Having considered the foregoing findings of fact, conclusions of law, the evidence of record, the candor and demeanor of the witnesses, and the pleadings and arguments of the parties, it is, therefore, RECOMMENDED that a final order be entered by the Agency for Health Care Administration providing for recoupment of $93,104.95, and that the Respondent, Brown Pharmacy, must re-pay that amount to the Petitioner Agency, through a reasonable re- payment plan established between the parties. DONE AND ENTERED this 3rd day of November, 2006, in Tallahassee, Leon County, Florida. S P. MICHAEL RUFF Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with Clerk of the Division of Administrative Hearings this 3rd day of November, 2006.
