The Issue Whether Petitioner has been substantially affected by agency statements made by Respondent, and, if so, whether the statements violate section 120.54(1)(a), Florida Statutes?
Findings Of Fact Petitioner, Harmony Environmental (Harmony), is duly- licensed as a Universal Waste Transporter Facility (UWTF) with the Florida Department of Environmental Protection (FDEP), holding EPA ID No. FLR000202424. Additionally, Harmony is registered as a Hazardous Waste Transporter by FDEP as well as the U.S. Department of Transportation (USDOT); a Used Oil Handler by FDEP; a Biomedical Waste Transporter by the Florida Department of Health; and as a Waste Transporter by Broward and Miami-Dade counties. Respondent is the state department charged with regulating drugs, devices, and cosmetics pursuant to section 20.165 and chapter 499, Florida Statutes. Respondent does not have jurisdiction over the permitting of universal waste transporters or over Florida Administrative Code Chapter 62-730. Respondent has not issued any permits or licenses to Petitioner. On May 20, 2014, Respondent’s Inspector Dr. Tram Vu inspected Petitioner. The Entry Notice and On-Site Inspection Report was included as an exhibit to the Petition filed in this matter. It makes reference to the “inspection” by Dr. Vu as one, “conducted under Ch. 499.051, F.S., and Rule 61N-1.019, F.A.C., to assess firm’s activities and compliance.” Respondent admitted the May 20th inspection was conducted under the authority cited in the report. On July 16 and 17, 2014, Dr. Vu again inspected Petitioner. A number of photographs were taken during the inspection. The photographs depict two large white containers referred to in the Petition and at the hearing as “yard super sacks.” Inspector Vu testified that the yard super sacks were sealed and that none of the “prescription drugs” photographed were found outside of the sealed Universal Pharmaceutical Waste (UPW) containers. Dr. Vu subsequently requested Petitioner to “voluntarily” quarantine the super sacks and a black tote, and a voluntary quarantine form was prepared and executed. The voluntary quarantine form states that it is “an alternative to the Florida Department of Business and Professional Regulation (‘DBPR’) removing some or all of the products for examination and sampling pursuant to Section 499.065(2), Florida Statutes.” Respondent issued a Notice of Intent to Deny (NOID) to Petitioner on August 18, 2014, regarding its application for a restricted drug distributor/destruction permit. The NOID concluded that Petitioner acted as a restricted drug distributor/destruction establishment without a license. The NOID cited rule 61N-1.023(4), which provides that such a permit is required for a person to take possession in Florida of a prescription drug for the purpose of arranging for its destruction. When asked by Petitioner in an interrogatory, “Are there any facts or circumstances that would cause the DDC to consider that a prescription drug has become UPW and no longer subject to its authority? If so, state or identify each and every such fact or circumstance.” Respondent answered, “No. The term ‘UPW’ is a term that is within the jurisdiction of another Florida state agency, the Department of Environmental Protection (DEP). A prescription drug is no longer a prescription drug when the nature of the prescription drug is altered or changed in a way that the active ingredient which causes the prescription drug to be a prescription drug is no longer active.” Reginald Dixon, the Director of the Division of Drugs, Devices, and Cosmetics (DDC), acknowledged that in his two years as Director, Respondent’s chapter 61N-1 has not contained any definition that addresses the difference between viable drugs and non-viable drugs and that it contains no reference to UPW. Mr. Dixon further acknowledged that chapter 61N-1 does not contain the statement that “[a] prescription drug is no longer a prescription drug when the nature of the prescription drug is altered or changed in a way that the active ingredient which causes the prescription drug to be a prescription drug is no longer active.” He further acknowledged that he is not aware of any federal or Florida law, rule, or regulation that provides the same or similar statement; and that chapter 61N-1 does not contain any definition or explanation as to how the change or alteration that may render the active ingredient inactive takes place. Respondent’s policy that a drug continues to be a prescription drug until its nature is altered or changed so that the active ingredient that makes it a prescription drug is no longer active applies not only to Petitioner. Such policy would apply to other entities engaged in a similar business, as well as to pharmacies, drug wholesalers, and hospitals when considering how to legally dispose of prescription drugs. Respondent takes the position that the UPW rule “is not a rule that belongs to DBPR” (Hr’g Tr. 62); that Respondent “does not have any jurisdiction over the DEP rules” (Hr’g Tr. 75); and that Respondent does “not look at the DEP rules to determine or use their determination of whether or not a drug is viable . . . or nonviable” (Hr’g Tr. 75). “To the extent that [the UPW] rule talks about viable and nonviable pharmaceuticals, that’s not something within our jurisdiction and we don’t deal with it” (Hr’g Tr. 78). Respondent admitted that it is important for regulated entities to know when the agency considered that a drug is no longer under its jurisdiction. Respondent also admitted that if other regulations exist that do not call prescription drugs “prescription drugs” anymore, but instead call them “solid waste, universal pharmaceutical waste or hazardous waste,” those statutes and regulations may “possibly” have a bearing on chapter 499 and chapter 61N-1. In response to Petitioner’s Request for Admissions, Respondent claimed to be “without knowledge” of whether the hazardous waste program under the Federal Resource Conservation Recovery Act (RCRA) established a “cradle to grave” system for controlling hazardous waste; and whether pursuant to 40 C.F.R. § 272.501, the Federal EPA approved the hazardous waste management program administered by the FDEP pursuant to chapter 403, Florida Statutes. Moreover, Respondent was “without knowledge” of whether the U.S. Food and Drug Administration (FDA) does not regulate drugs that have been discarded as hazardous or pharmaceutical waste; and that the FDA does not regulate generators or handlers of hazardous or pharmaceutical waste. Respondent also claimed to be “without knowledge” that some UPW is generated by hospitals during surgical procedures when a vial containing a standard dose of medication is not fully used because of the patient’s size or condition, with the unused dose “wasted” by placing it in a sealed, properly labeled UPW container; that hospitals that dispose of non-controlled and non-viable drugs in a properly labeled UPW container pursuant to rule 62-730.186, do not routinely create a list or inventory of the drugs being wasted or placed in the container that includes the name of the manufacturer, the name of the drug, the quantity, lot number, expiration date, or any combination of these elements; and that hospitals wasting non-viable controlled substances maintain a log that identifies the name and quantity of the controlled substance wasted, but not the manufacturer, the lot number, or the expiration date; and that such controlled substance log complies with DEA regulations as well as chapter 893, Florida Statutes. Mr. Dixon testified that the act of disposing of the unused portion of a prescription drug in a UPW container at a hospital that also contains sharps, broken glass, tissue, and bloody gauzes could constitute the adulteration of that prescription drug. Further, Mr. Dixon testified that when hospitals dispose of drugs in UPW containers they are “possibly” adulterating drugs, and when Petitioner picks up the UPW container, Petitioner may likewise “possibly” be holding adulterated drugs. Petitioner’s witness, Michelle Chambers, was accepted as an expert witness on UPW and related regulations, both state and federal. Although unpaid for her work due to being the spouse of Petitioner’s owner, she is the compliance coordinator, bookkeeper, and registered agent for Petitioner. Mrs. Chambers trains drug wholesalers how to manage their UPW by directing them to “utilize a return if they can get credit for the drug, but that once a drug becomes waste it falls under the guidelines of UPW and those drug wholesalers need to create a separate area that can handle UPW containers.” When discussing the process of sending UPW to a reverse distributor regulated by Respondent, Mrs. Chambers referred to the FDEP’s pharmaceutical waste guidelines, which state: Only pharmaceuticals with a reasonable expectation of credit can be sent to a reverse distributor. Drop pills, non- credible items, formulated mixtures, items with patient’s names, and raw chemicals cannot be sent to a reverse distributor for credit; thereafter, a waste determination is required and the decision must be made to manage this waste as hazardous waste or UPW waste. Mrs. Chambers stated she had knowledge of unexpired drugs, still in the original packaging that were declared waste by the wholesaler. She asserted that drug wholesalers abandoned or discarded the unexpired drugs in their original packaging because “they couldn’t send it back to a reverse distributor to get credit. There was just no value to it, whatsoever, so they decided to make that waste determination that this is waste, UPW.” Mrs. Chambers stated that UPW labels are attached to UPW containers in Petitioner’s facility, according to the FDEP rule regarding UPW. These labels represent the characteristics of the hazardous waste and other waste inside those containers. Some of the notations on the label refer to a substance, material, or a chemical product that is a prescription drug. She also testified that several documents may be created in the UPW process, such as a hazardous-waste manifest and a bill of lading. In records that a UPW handler is expected to maintain under FDEP rules, a UPW handler is not required to have those records contain the name of the drugs that are in the UPW containers, the manufacturer’s information, or the expiration date of the drugs in the UPW container. She asserted that Petitioner could not reasonably create inventories of all the drugs inside a UPW container because “some of the labels have been poured on by other elements within the container; some are unidentifiable; some are broken . . . it would be very difficult to create an inventory.” Based upon her audits of more than 200 hospitals, Mrs. Chambers stated that if a hospital has a procedure to put non-viable drugs in a UPW container, it is because they are trained to do so. She testified that no hospital she has ever audited has ever kept records that include drug names, manufacturers, or expiration dates for anything they have placed in the UPW containers. Petitioner picks up these containers and brings them to its facility. A UPW handler can add waste to the container, as well as consolidate those containers. Mrs. Chambers also discussed consumer packaging under rule 62-730.186(4)(a), which states: “Consumer packaging” means the packaging that surrounds and encloses a container, in a form intended or suitable for a healthcare or retail venue, or rejected during the manufacture process as long as it is enclosed in its bottle, jar, tube, ampoule, or package for final distribution to a healthcare or retail venue. Further, UPW handlers can conduct activities, including disassembling packages containing several pharmaceuticals into individual pharmaceuticals from consumer packaging. In her experience in the auditing of hospitals for UPW, as well as with Petitioner, Mrs. Chambers stated that controlled substances are put into UPW containers from time to time, yet Petitioner has never been cited or received a notice of violation from the DEA regarding the possession of a controlled substance. To her knowledge, the DEA has never notified any UPW handler in Florida of any violations for possessing controlled substances. Dr. Vu conducts inspections and investigations pursuant to chapter 499, specifically investigating unlicensed activities as well as inspecting facilities that are attempting to obtain a DDC permit. Dr. Vu was tendered and accepted as an expert in pharmacy and conducting inspections for Respondent pursuant to chapter 499. She testified that during her inspection of Petitioner on July 14, 2014, she pulled drugs from UPW containers to inspect them. She admitted there were no prescription drugs outside the UPW containers on Petitioner’s premises. She stated that Petitioner’s agents or employees volunteered to open the UPW containers for her inspection. The scant evidence Dr. Vu relied upon that Petitioner had any controlled substances on the premises was based upon documents she obtained from a third party as well as from Petitioner. She admitted there was no evidence of controlled substances on Petitioner’s premises. While Dr. Vu stated she is able to recognize prescription drugs when she sees them, she is not able to recognize UPW since she is “not trained in universal pharmaceutical waste.” She also stated she is not able to recognize a non-viable drug when she sees it. Dr. Vu has received no training from Respondent on the opening of UPW containers, and even though she has not been trained in UPW rules and definitions, she strongly asserted that Petitioner “[c]learly was in possession of prescription drugs,” and that Petitioner had no permit or authorization to possess prescription drugs. When asked about her understanding of when a prescription drug ceases to be a prescription drug, she replied that “a prescription drug is always a prescription drug unless it’s inactivated or loses its drug ability –- characteristics.” Dr. Vu noted that this understanding is not stated in chapter 61N-1 or chapter 499. David Laven, another drug inspector for Respondent, was tendered and accepted as an expert in pharmacy and issues related to the inspection for Respondent under chapter 499. He testified that Petitioner is not allowed to possess prescription drugs without a DDC permit. On cross-examination, however, he admitted he had not read the rule on UPW, has no knowledge of EPA rules and requirements, and that he is not trained to recognize a non-viable drug. He testified that he considers a prescription drug that is discarded in a UPW container still to be a prescription drug because “there’s still a possibility, depending on how that drug has been disposed of, the container may be partially full –- it can be a full container sometimes. Drugs are thrown in a container for a number of reasons, doesn’t necessarily mean that the drug is no longer viable or can be used in any way.” Regarding the definition of prescription drugs, Mr. Laven stated that “[a] drug is no longer viable or useable if it’s out of date, it’s been damaged in some way, compromised, mis-branded, [or] adulterated.” On October 6, 2014, Petitioner sent a Notice of Unadopted Rules letter to Respondent, stating that the conduct and statements set forth above constitute unpromulgated rules and that, according to section 120.595(4)(b), Florida Statutes, they have 30 days to begin proposed rulemaking in order to rectify the actions and statements made. Respondent did not begin proposed rulemaking in that 30-day period. Respondent presented no evidence or testimony to establish that rulemaking was not feasible or practicable.
Findings Of Fact On June 27, 1991, Petitioner applied for licensure in the State of Florida by endorsement as a physician. He is presently licensed in the states of Alabama, Louisiana and Wisconsin. He is board eligible in dermatology and is currently a house physician for New Orleans General Hospital in New Orleans, Louisiana. On January 5, 1993, Respondent denied Petitioner's Florida application because of Petitioner's previous history of psychiatric problems and psychotherapy which affected his ability to practice medicine with skill and safety; his current psychiatric and psychological evaluations indicating an obsessive-compulsive disorder which could affect his abilities to practice with skill and safety; and the prior denial of his licensure application in 1987 as the result of material misrepresentations in the application. On three separate occasions, Petitioner has applied for licensure in Florida. In addition to the current application, he applied on April 4, 1986 and on August 2, 1990. Following a formal hearing, the 1986 application was denied on December 22, 1987, as the result of misrepresentation in the application. An application for admission filed in 1990 was subsequently not timely completed and became void. All of Petitioner's applications and materials submitted with regard to those applications are maintained by Respondent in one file, a normal practice for Respondent. Documents in that application file have been generated by Respondent or supplied by Petitioner. Diagnosed in 1977 with an obsessive-compulsive disorder, obsessive- compulsive personality and dysthymia, Petitioner has been receiving treatment for his mental illness since 1979. He was hospitalized for a psychotic episode in 1987. From 1988 until the present, Petitioner has been taking Sinequan and Mellaril. The daily dosage of 50 milligrams of Mellaril has not varied during that time period. The daily dosage of Sinequan initially was 150 milligrams per day, tapered to 40 milligrams each night at present. About three months ago, Petitioner began taking about a gram of Valproic acid each night. These medications have a sedating or hangover effect on Petitioner in the morning. At one point in 1992, Petitioner temporarily switched to another drug, Anaframil, for a month to a month and a half. One of the reasons for the switch was that Petitioner was going to be reevaluated by a psychiatric expert, Dr. Dohn, at Respondent's request. Dr. Dohn's previous evaluation had expressed concerns about possible effects on Petitioner's clinical abilities as a result of medication side effects. After Dohn's second evaluation of Petitioner, Dohn was much more confident of Petitioner's abilities in view of the then change to Anaframil for treatment of Petitioner's obsessive-compulsive disorder. Mellaril and Valproic acid are psychotropic medications which have confusion as a side effect. Sinequan can have confusion and sedation as a side effect. Valproic acid also has a sedating effect. The dosage of these medications as taken by Petitioner are sufficient to produce these side effects. The effects of the medications carry over to the following day, although taken the evening before. Psychological evaluations of Petitioner dated October 7, 1991 and August 28, 1992, reflect that Petitioner's cognitive abilities have been affected by his mental condition, inclusive of the medications he takes. The 1991 evaluation documents Petitioner's difficulties with recall of verbal instructions and numbers presented verbally to him; completing eye-hand coordination tasks within the maximum time limit; distinguishing visual details; and a tendency to become stymied with anxiety. Further, the 1992 report indicates that certain symptoms of Petitioner's obsessive-compulsive disorder could conceivably interfere with his ability to perform surgery. The 1992 report was done following testing of Petitioner after his brief change to the drug, Anaframil. Following Petitioner's 1992 evaluation by Dr. Dohn, conducted in close proximity to the August 1992 psychological evaluations, Petitioner quit taking Anaframil and resumed his previous medications of Mellaril and Sinequan. At deposition following a recent psychiatric evaluation of Petitioner by Dr. Edward Foulks, Foulks opined that Petitioner's illness should not be a barrier to the practice of medicine. Foulks opinion is not credited in view of his lack of independent knowledge of Petitioner's medications or mental condition; his lack of knowledge of whether Petitioner's condition had stabilized; how the condition had been resolved; or how much further treatment Petitioner would likely require. Foulks' opinions were based in large part upon Petitioner's representations to him. Petitioner's evaluations from Lazarus S. Gerald of the University of Pennsylvania Department of Dermatology, dated August 21, 1990 and July 8, 1991; from the chief of the Dermatology Department of Lloyd Noland Hospital and Clinic in Fairfield, Alabama, dated August 21, 1990; and from Dr. Derek J. Cripps, Director of the Department of Dermatology of the University Station Clinics, University of Wisconsin, note Petitioner's psychiatric condition as a possible explanation for performance difficulties. In 1986, Petitioner made numerous misrepresentations in his application for licensure. He answered "no" to the application question of whether he had a mental or emotional illness, although he had been ill since 1977 and had been treated from 1979 until 1986 by several psychiatrists. He also answered "no" to whether he had received psychotherapy. He was suspended from seeing patients during the last three months of residency at the University of Wisconsin, but answered "no" to the question of whether he had ever ceased practice for more than a month. He also answered "no" to the question of whether he had ever been denied hospital privileges or had such privileges acted against. In his August 2, 1990 application, Petitioner again answered "no" to whether he had been denied hospital privileges or had his hospital privileges acted against. Later, recognizing that this was not an accurate representation, Petitioner forwarded an affidavit, dated May 16, 1991. In that affidavit, Petitioner changed his answer to "yes". While only receiving partial credit of three months for his residency at the University of Wisconsin, Petitioner listed the dates on the form so that it appeared that he had received one year's credit. In his current application, dated June 27, 1991, Petitioner again failed to show that he only received partial credit for his residency at the University of Wisconsin. An affidavit dated November 21, 1991, was submitted by him regarding the residency program at Tulane University in which he was then participating. The affidavit failed to indicate that his participation in the residency program was conditioned upon his being in the impaired residents program and that the residency lasted 18 months, although he needed only six months to complete residency requirements for the dermatology board examination. Petitioner also failed to tell his supervising physician at Tulane, Dr. Shrum, of Petitioner's previous application for licensure in Florida or denial of that application for licensure, until after Shrum had been deposed regarding Petitioner's reputation for truthfulness.
Recommendation Based on the foregoing, it is hereby RECOMMENDED that a Final Order be entered denying the application for licensure by endorsement. DONE AND ENTERED this 10th day of December, 1993, in Tallahassee, Leon County, Florida. DON W. DAVIS Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 10th day of December, 1993. APPENDIX TO RECOMMENDED ORDER, CASE NO. 93-1671 The following constitutes my specific rulings, in accordance with Section 120.59, Florida Statutes, on findings of fact submitted by the parties. Petitioner's Proposed Findings. 1.-2. Accepted. Rejected, weight of the evidence. Rejected, cumulative. Subordinate to HO findings. Accepted. Subordinate to HO findings. 8.-13. Accepted, but not verbatim. 14. Rejected, credibility. 15.-20. Rejected, unnecessary. 21.-25. Subordinate to HO findings. 26. Rejected, credibility. 27.-38. Rejected, credibility. 39.-45. Rejected, credibility. 46.-51. Rejected, subordinate to HO findings. 52. Rejected, relevancy. 53.-59. Rejected, credibility. Respondent's Proposed Findings. 1.-13. Accepted, but not verbatim. COPIES FURNISHED: Claire D. Dryfuss, Esquire Department of Legal Affairs The Capitol, PL-01 Tallahassee, Florida 32399-1050 Steven W. Huss, Esquire 1017-C Thomasville Road Tallahassee, Florida 32303 Jack McRay General Counsel Department of Business and Professional Regulation The Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0750 Dorothy Faircloth Board of Medicine Department of Business and Professional Regulation The Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0750
Findings Of Fact The Home is licensed as an assisted living facility. It is also licensed to provide extended congregate care, limited nursing services, and limited mental health services. The Home accepted Respondent as a resident. In July 1998, Petitioner had to transport Respondent to the hospital due to an overdose of medication. Upon his return from the hospital, Respondent told Petitioner's staff that he had taken the overdose intentionally. Thereafter, the Home required Respondent to sign a mental health contract dated September 9, 1998. This contract states as follows in relevant part: Qualifications for the Home requires [sic] that a member or applicant must not be mentally ill, habitually inebriated, or addicted to the use of a controlled substance. With these requirements, I understand that to be eligible and maintain my membership in the Home, I must agree to the terms of this contract. * * * If I use alcohol or any non-prescribed drugs I understand I may be dismissed from the Home. I understand that I will allow the Veterans' Domiciliary Home of Florida to supervise the self-administering of my medications. I will take my medication as it is prescribed by the primary physician. I will only be given my full prescription at the time of my discharge. I understand upon reasonable suspicion of being under the influence of alcohol or illegal drugs, I consent to testing. The Domiciliary Home staff may take a blood, saliva, or supervised urine sample to test for illegal drugs or alcohol. I authorize members of the Domiciliary staff to perform random searches of my person, vehicle, living quarters, or belongings to determine if I am using drugs or alcohol. If I refuse to allow a blood, saliva, or urine test, or search, or if I interfere in any way with the staff's performance of these duties, I may be dismissed. The Home also required Respondent to sign a Dual Diagnosis/Substance Abuse/Psychiatric (dual diagnosis) contract dated September 14, 1998. In addition to terms and conditions similar to the ones set forth above, the dual diagnosis contract provides as follows in relevant part: 10. In order to assist me in gaining freedom from alcohol and drugs, I will not use alcohol, tranquilizers, sleeping medication, over the counter medications, or any other chemical escapes which have not been prescribed by a physician. If I use alcohol or non-prescribed drugs, I understand I will be dismissed from the Home. In November 1998, one of Respondent's doctors wrote him a prescription for Ritalin. Respondent became very upset when a nurse would not administer the Ritalin to him without first checking with Petitioner's staff physician. Eventually, Respondent's primary care physician approved the administration of Ritalin together with Respondent's other medications. In January 1999, Respondent worked for Petitioner as a receptionist. After working overtime on one occasion, Respondent's speech was slurred, his eyes were dull, and his voice was horse. Petitioner's staff became suspicious that Respondent was taking medication in violation of his contracts. Respondent subsequently tested negatively for all substances except his prescribed medicines. In March 1999, Respondent violated his contracts by having a prescription for methadone filled at a drugstore and removing twenty-four of the pills from the bottle before turning the medicine over to Petitioner's staff as required by his contract. Petitioner's staff advised Respondent that he would be dismissed from the Home by letter dated March 23, 1999. Respondent subsequently requested Petitioner's Executive Director to review the decision to discharge him from the Home. By letter dated August 16, 1999, Petitioner rescinded its decision to dismiss Respondent from the Home but warned him that any further infraction would result in his immediate expulsion. On April 14, 2000, Petitioner conducted a routine facility-wide room inspection at the Home. During the course of the inspection, Petitioner found a bottle of Ephedra 250 in Respondent's room. According to the label on the bottle, Ephedra 250 is a dietary supplement that General Nutrition Corporation (GNC) markets. During the hearing, Respondent admitted that he heard about Ephedra 250 on a television show that discussed its benefits as a diet aid as well as its dangerous side effects. The label states as follows in pertinent part: WARNING: Seek advice from a health care practitioner prior to use if you are pregnant or nursing, or if you have high blood pressure, heart or thyroid disease, diabetes, difficulty in urination due to prostate enlargement, or if taking MAO inhibitor or any other prescription drug. Reduce or discontinue use if nervousness, tremor, sleeplessness, loss of appetite or nausea occur. Not intended for use by person under the age of 18. The maximum recommended dosage of Ephedrine for a healthy adult is no more than 100 mg in a 24 hour period for not more than 12 weeks. Improper use of this product may be hazardous to a person's health. Each capsule of Ephedra 250 contains 250 mg of MA Huang Extract (Ephedra sinica) or ( 15 mg of 6 percent Ephedrine). The greater weight of the evidence indicates that Ephedra 250 is an over-the-counter medication despite being labeled as a diet supplement. Ephedrine is a prescription drug in Florida unless an individual dose is less than a specified quantity. Petitioner's staff properly became concerned about Respondent's possession of Ephedra 250 because he takes numerous prescribed medications, which can have serious side effects, if taken with certain other medications. Ephedrine is one of those drugs. For instance, Respondent takes Cozaar for high blood pressure, Methadose to reduce his dependency on Percoset, and Ritalin. Persuasive evidence indicates that large doses of Ephedra can be used as a recreational drug. Respondent knew or should have known that Ephedra 250 was prohibited by his contracts with the Home.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That Petitioner enter a final order dismissing Respondent as a resident of the Robert H. Jenkins Veterans' Domiciliary Home of Florida. DONE AND ENTERED this 6th day of October, 2000, in Tallahassee, Leon County, Florida. SUZANNE F. HOOD 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 6th day of October, 2000. COPIES FURNISHED: James W. Sloan, Esquire Department of Veterans' Affairs Post Office Box 21003 St. Petersburg, Florida 33731-8903 William T. Fisher 1300 Sycamore Lane, Suite 148 Lake City, Florida 32025 Lt. Col. Robin L. Higgins, Executive Director Department of Veterans' Affairs Post Office Box 31003 St. Petersburg, Florida 33731-8903
Findings Of Fact Based upon my observation of the witnesses, their demeanor while testifying, the documentary evidence received and the entire record compiled herein, I make the following findings of fact: The Department of Health and Rehabilitative Services (??"HRS") is the regulatory agency charged with the administration of Chapter 499, Florida Statutes, which includes the issuance of permits to operate a drug wholesale facility. Sometime prior to December, 1986, Petitioner, Vetco International, Inc. d/b/a Pompano Vet Supply ("Vetco") was issued Wholesale Drug Permit Number 03:00375 by the Pharmacy Program of HRS. On December 15, 1986, HRS received an application from Thomas Karpinski, owner of Vetco, to renew Vetco's drug wholesale permit for 1987. On December 17, 1986, HRS denied Vetco's application for renewal of its wholesale drug permit for the year 1987. Vetco requested a formal administrative hearing on the denial and the matter was referred to the Division of Administrative Hearings where it was assigned Case No. 87-0832. A hearing was held in that case on August 18, 1987 by Hearing Officer, James Bradwell of the Division of Administrative Hearings. On March 28, 1988, Hearing Officer Bradwell entered a Recommended Order recommending that Vetco's renewal application for the year 1987 be denied. The basis for that recommendation was that the applicable statutes and rules required that facilities where drugs are held be made available for inspection; that on several occasions Vetco's facility was not made available to authorized agents of HRS for inspection; and that Vetco's denial of inspections to HRS constituted a substantial violation of Chapter 499, Florida Statutes and Rule 10D-45, Florida Administrative Code. Hearing Officer Bradwell's Recommended Order was approved and incorporated in a Final Order by HRS dated April 20, 1988. On May 16, 1988, Vetco filed a Notice of Administrative Appeal to the Fourth District Court of Appeal regarding the Final Order issued by HRS on April 20, 1988. The case number assigned by the District Court of Appeal was Case No. 88-1342. On June 23, 1988, Vetco filed a Motion for Imposition of Automatic Stay with the Fourth District Court of Appeal seeking to stay the effect of HRS' April 20, 1988 Final Order. The Motion to Stay was granted by the Fourth District Court of Appeal on July 15, 1988. On December 28, 1988, the Fourth District Court of Appeal, per curiam, affirmed HRS' April 20, 1988 Final Order. The Mandate from the Fourth District Court of Appeal was issued on January 13, 1989. During the time period between the conclusion of the formal administrative hearing in August, 1987 and the issuance of the Recommended Order by Hearing Officer Bradwell in March, 1988, counsel for Vetco initiated efforts to obtain a renewal of the drug wholesale permit for the year 1988. Vetco contends that it did not receive the standard 1988 renewal application form typically sent by HRS prior to the beginning of the new year. By letter dated January 21, 1988, counsel for Vetco advised HRS that Vetco intended to keep its license in effect. In that letter, counsel for Vetco submitted a check for the amount of the renewal fee and provided certain other information required as part of the renewal process. During the period from January, 1988 through May, 1988, there were several exchanges between counsel for Vetco and the representatives of HRS regarding the renewal for the year 1988. HRS took the position that the January 21, 1988 letter from counsel for Vetco could not serve as a renewal application because it was not signed by the owner of the company and was not submitted on the appropriate HRS form. Vetco contends that the January 21, 1988 letter included all of the information legally required to process the renewal application and should have been treated as a renewal application. After exchanging correspondence and phone calls with counsel for Vetco and obtaining a signed form from Vetco, HRS acknowledged on May 24, 1988, that the renewal application was complete. On June 6, 1988, HRS denied Vetco's application for license renewal for the year 1988 citing the Final Order filed on April 20, 1988 and the Findings of Fact set forth in the Recommended Order entered by Hearing Officer Bradwell on March 28, 1988 in connection with the 1987 renewal application. By petition filed June 30, 1988, Vetco sought a formal hearing on the denial of its 1988 renewal application. The matter was referred to the Division of Administrative Hearings and assigned Case No. 88-3596. It is one of the two cases consolidated in the current proceeding. As noted above, by order dated July 13, 1988, the Fourth District Court of Appeal stayed the effect of the Final Order regarding the 1987 renewal application and, by agreement of the parties, Division of Administrative Hearings Case No. 88-3596 was abated pending the decision of the Fourth District Court of Appeal on the 1987 renewal. Thus, Vetco was able to continue business operations uninterrupted throughout 1987 and 1988. On January 6, 1989, Vetco applied for renewal of its drug wholesale permit for the year 1989. By letter dated January 17, 1989, HRS refused to renew Vetco's permit for 1989 citing the Fourth District Court Of Appeal's decision on the 1987 application. On February 2, 1989, Vetco filed a Petition for Formal Hearing challenging this denial. The Petition for Formal Hearing was transferred to the Division of Administrative Hearings and assigned Case No. 89-717. It is the second case involved in this current proceeding. By order dated April 19, 1989, Division of Administrative Hearings' Case Nos. 88-3596 and 89-717 were consolidated.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is: RECOMMENDED: Petitioner's application for renewal of its wholesale drug permit No. 03:00375 for the year 1988 be dismissed as moot and the application for renewal for the year 1989 be DENIED. DONE and ENTERED in Tallahassee, Leon County, Florida, this 23rd day of August, 1989. J. STEPHEN MENTON Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 904/488-9675 Filed with the Clerk of the Division of Administrative Hearings this 23th day of August, 1989. APPENDIX TO RECOMMENDED ORDER, CASE NOs. 88-3596 AND 89-0717 The parties have submitted proposed findings of fact. It has been noted below which proposed findings of fact have been generally accepted and the paragraph number(s) in the Recommended Order where they have been accepted, if any. Those proposed findings of fact which have been rejected and the reason for their rejection have also been noted. The Petitioner's Proposed Findings of Fact Proposed Finding Paragraph Number in Recommended Order of Fact Number Findings of Fact where accepted or reason for rejection 1 2-7 2-12 Adopted in part in Findings of Fact 13-16, otherwise rejected as irrelevant. 13 Adopted in part in Findings of Fact 17, otherwise rejected as irrelevant. 14 Rejected as irrelevant. 15 Adopted in part in Findings of Fact 18-19, otherwise rejected as irrelevant. 16 Adopted in part in Findings of Fact 9-12 and 20, otherwise rejected as irrelevant. 17-21 Rejected as irrelevant. The Respondent's Proposed Findings of Fact The proposed findings of fact in Respondent's Proposed Recommended Order are not numbered. The individual paragraphs are treated as though separately numbered. Proposed Finding Paragraph Number in Recommended Order of Fact Paragraph Findings of Fact where accepted Number reason for rejection 1 3 2 Adopted in part in Findings of Fact 4, otherwise rejected as irrelevant. 3 Adopted in part in Findings of Fact 5, otherwise rejected as irrelevant. 4 6 5 6-7 6 8-12 COPIES FURNISHED: Karen Coolman Amlong, Esquire Amlong & Amlong, P.A. 101 N.E. 3rd Avenue 2nd Fl. Fort Lauderdale, Florida 33301 John Rodriguez, Esquire Technical Health Services, Department of Health and Rehabilitative Services 1317 Winewood Boulevard Building 1, Room 304 Tallahassee, Florida 32399-070 Sam Power, Agency Clerk Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700 Gregory L. Coler, Secretary Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700 John Miller Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700
The Issue This is a license discipline case, in which the Petitioner seeks to take disciplinary action against a pharmacy licensee on the basis of alleged violations of Sections 465.014, 465.023(1)(c), and 465.025(3)(b), Florida Statutes.
Findings Of Fact The Respondent in this case, Nan-Dan, Inc., is, and has been at all times material to the Second Amended Administrative Complaint, a licensed community pharmacy, holding license number PH 0002807. The Respondent does business as "Buy-Rite Drugs." The Respondent's address is 103 South 3rd Street, Lantana, Florida 33462-2853. The Respondent Nan-Dan, Inc., does not do business as "Professional Rx Systems." There is another business entity known as "Professional Rx Systems," which was licensed in November of 1987, and which does business as "Nan-Dan Corp., Inc." Professional Rx Systems is a licensed community pharmacy, having been issued license number PH 0010094. Professional Rx Systems is a separate and distinct licensee and is a separate and distinct business entity from Nan- Dan, Inc., the Respondent in this case. On or about May 30, 1991, a pharmacy (probably Professional Rx Systems) prepared a billing statement regarding prescriptions for patient O.I. The entries on the billing statement include an entry for prescription number 6171144, described as "60 ROBAXIN-750 TABS," with a corresponding charge of $33.42. The second page of the May 30, 1991, billing statement includes an entry for prescription number 4173954, described as "30 DARVOCET N 100," with a corresponding charge of $20.02. Robaxin 750 and Darvocet N-100 are both brand name drugs. Dr. Faustino Gonzalez was and is the Medical Director of Gold Star Medical Management, a company which subcontracts with Humana Medical Plans to provide medical services to a group of patients. The facilities at which Gold Star Medical Management provides medical services probably includes Eason Nursing Home. In any event, in approximately May of 1991, Gold Star Medical Management did a quality review for Eason Nursing Home, in which it looked at the prescriptions for numerous patients. Of the cases that were reviewed, Dr. Gonzalez did not recall seeing anything but generic drugs which had been actually dispensed to the patients. However, Dr. Gonzalez does not recall whether the Robaxin 750 listed on the billing statement described above was one of the drugs he reviewed. Similarly, there is no evidence that the Darvocet N- 100 listed on the billing statement described above was one of the drugs reviewed by Gold Star Medical Management. Dr. Gonzalez did not recall whether he had ever actually seen patient O.I. and he did not know whether the drugs actually furnished to patient O.I. were brand name drugs or generic drugs. There is no evidence in the record of this case of the identity of the pharmacist or pharmacists who may have dispensed any drugs to patient O.I. There is no evidence in the record of this case as to the amount of the cost savings, if any, that accrued or might have accrued to the pharmacy if generic drugs had been dispensed in lieu of brand name drugs. There is no evidence in the record of this case as to how much was paid by or on behalf of the patient O.I. for the drugs itemized on the billing statement described above. For a brief period during July of 1987, the Respondent employed Harold B. Steinberg as a pharmacist. Mr. Steinberg presently has a hostile attitude towards the owner of the Respondent corporation. From approximately February of 1991 through May of 1991, Joyce Trapp was employed by the Respondent as a pharmacy technician.
Recommendation On the basis of all of the foregoing, it is RECOMMENDED that the Board of Pharmacy enter a Final Order in this case dismissing all of the violations alleged in the Second Amended Administrative Complaint. DONE AND ENTERED this 25th day of August, 1993, at Tallahassee, Leon County, 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 25th day of August, 1993. APPENDIX TO RECOMMENDED ORDER, CASE NO.92-4270 The following are my specific rulings on all proposed findings of fact submitted by all parties. Findings submitted by Petitioner: Paragraph 1: Rejected as contrary to the greater weight of the evidence. (See Petitioner's Exhibit 2.) Paragraph 2: Rejected as not supported by clear and convincing evidence. The only witness to testify on this matter only referred to Eason as one of the nuring homes "being taken care of by Mr. Erb's operation." Mr. Erb has two operations, only one of which is a respondent here. Further, the witness' lack of reliable information on the matter is revealed by his testimony that he ". . . never got to see the papers." As a final matter, the Hearing Officer has given very little credit to Mr. Steinberg's testimony. Mr. Steinberg's testimony was vague and imprecise and Mr. Steinberg appeared to have very hostile feelings towards the owner of the Respondent entity. Paragraph 3: Accepted. Paragraph 4: Rejected as not supported by persuasive clear and convincing evidence. Mr. Steinberg's testimony on this subject was vague and imprecise. It also has some unexplained conflicting details, among them the assertion at one point that Steinberg was the only pharmacist on the premises and the later assertion that Mr. Erb was present and that Mr. Erb was also a pharmacist. Further, the only evidence of the absence of supervision consists of hearsay evidence that would not be admissible over objection in a civil action, largely because the hearsay speakers are unidentified. And as a final matter, the activities vaguely described by Mr. Steinberg do not constitute "dispensing" within the statutory definition of the word "dispense" at Section 465.003(5), Florida Statutes (1986 Supp.). Paragraph 5: Rejected as irrelevant or as subordinate and unnecessary details. Paragraph 6: Accepted. Paragraph 7: Rejected as irrelevant because not charged in the Second Amended Administrative Complaint. Also rejected as not supported by persuasive clear and convincing evidence. Ms. Trapp appeared to have a very poor memory and her testimony tended to be vague and incomplete. Paragraph 8: Rejected for several reasons, including the fact that without a reference to the time and place of these proposed facts, there is no way to determine whether these proposed facts are relevant to the allegations of the Second Amended Administrative Complaint. Also rejected because there is no persuasive clear and convincing evidence of these proposed facts. Paragraphs 9, 10, 11 and 12: Accepted in substance. Paragraph 13: Rejected as either not supported by persuasive clear and convincing evidence or as being contrary to the greater weight of the evidence. In this regard it is noted that, although Petitioner's Ex. 3 is incomplete at the top, the visible portion of the business name at the top of the statement is "X SYSTEMS" and printed across the bottom of the statement is the business name "PROFESSIONAL RX SYSTEMS." Accordingly, it is more likely that the drugs billed to patient O.I. were billed by Professional Rx Systems (which is not a Respondent in this case) than that they were billed by the Respondent, Nan-Dan, Inc., d/b/a Buy Rite Drugs. Further, Dr. Gonzalez' testimony was to the effect that he was not sure whether his review included the drugs allegedly furnished to patient O.I. Paragraphs 14 and 15: Rejected as not supported by persuasive competent substantial evidence. As noted above, any dispensing involving the patient O.I. was probably done by someone other than the Respondent and, in any event, there is no persuasive competent substantial evidence as to what was actually dispensed. Paragraph 16: Accepted. Paragraph 17: Rejected as not supported by persuasive competent substantial evidence or as contrary to the greater weight of the evidence. (See discussion of Paragraphs 13, 14, and 15, above.) Paragraph 18: Accepted that the mentioned drug is a brand name "medicinal drug." The remainder of this paragraph is rejected as irrelevant, as well as not supported by persuasive competent substantial evidence. Paragraph 19: Rejected as not supported by persuasive competent substantial evidence. Findings submitted by Respondent: Paragraphs 1 and 2: Accepted. Paragraphs 3, 4, 5, and 6: Accepted in substance. Paragraph 7: Accepted. Paragraphs 8, 9, 10, 11, 12, and 13: Accepted in substance. Paragraphs 14 and 14: The last two paragraphs (both of which are numbered as 14) of the Respondent's proposed findings are, for the most part, rejected as constituting arguments as to why findings should not be made, rather than proposed findings of fact. (It is noted that the arguments are, essentially, correct and have been considered in deciding what findings should be made.) COPIES FURNISHED: Wayne H. Mitchell, Esquire Department of Business and Professional Regulation Northwood Centre, Suite 60 1940 North Monroe Street Tallahassee, Florida 32399-0792 William M. Furlow, Esquire Katz, Kutter, Haigler, Alderman, Davis & Marks, P.A. Post Office Box 1877 Tallahassee, Florida 32302-1877 Jack McRay, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792 John Taylor, Executive Director Board of Pharmacy 1940 North Monroe Street Tallahassee, Florida 32399-0775
The Issue This case involves the issue of whether the Respondent's license as a doctor of veterinary medicine should be disciplined for improperly prescribing Dilaudid, a controlled substance. At the formal hearing, the Petitioner called as witnesses Robert M. McGuire, Edward Duncan, and Mary Lee Page. Respondent testified on his own behalf. Petitioner had marked for identification five exhibits of which Exhibits 1, 2, and 5 were admitted. Exhibit 4 was not admitted into the record. Petitioner's Exhibit 3 was a composite of records received by a DPR investigator from the Respondent. Petitioner's Exhibit 3 is admitted and Respondent's objection on the grounds that the records were illegally seized is overruled. Also admitted into evidence was the prehearing stipulation and the Respondent's response to request for admissions as Joint Exhibit 1 and Joint Exhibit 2, respectively. Counsel for the Petitioner and counsel for the Respondent submitted proposed findings of fact and conclusions of law for consideration by the Hearing Officer. To the extent that those proposed findings of fact are consistent with the findings herein, the proposed findings were adopted. To the extent that those proposed findings are inconsistent with the findings made herein, they were considered by the Hearing Officer and rejected as being not supported by the evidence or not necessary to a resolution of this cause.
Findings Of Fact The Respondent is licensed to practice veterinary medicine in the State of Florida and holds License No. 0001405. The Respondent graduated from veterinary school in 1968 and has been a licensed veterinarian practicing in Florida for 13 years. Sometime prior to August 5, 1982, Ken Williams, a blacksmith who had done work for the Respondent, asked the Respondent to write a prescription for Dilaudid for his old and sick dog. Ken Williams stated the Dilaudid was for pain his dog was suffering. The Respondent, without having seen or examined the dog, wrote a prescription for 100 Dilaudid tablets, four milligrams each. (See Petitioner's Exhibit 5(a)). The prescription was given to Ken Williams and was filled by Robert M. McGuire, a licensed pharmacist in Ruskin, Florida. On September 3, 1982, the Respondent, after examining Ken Williams' dog, Satan, wrote a prescription for 100 Dilaudid tablets, four milligrams each, and gave the prescription to Ken Williams. The dog, Satan, was a young, healthy dog which was clearly not in pain. This was the same dog for which Ken Williams had requested the Dilaudid prescribed by the Respondent on August 5, 1982. The second prescription was also filled by Robert M. McGuire. After he wrote the second prescription, the Respondent researched Dilaudid in the Physicians Desk Reference. Prior to this research, he knew very little about Dilaudid as a drug. The Respondent concluded at that time that Williams was not using the Dilaudid for an animal, but was probably using it himself. The Respondent wrote prescriptions on October 6, 1982, October 28, 1982, and November 22, 1982. (See Petitioner's Exhibits 5(a) 5(d) and 5(e)). Each of these prescriptions was for 100 tablets of Dilaudid, four milligrams each. Each of these prescriptions was given to Ken Williams by the Respondent and was filled by Robert M. McGuire. The five prescriptions described in Paragraphs 3 through 6 above were not noted or recorded in the Respondent's records for his client Ken Williams. The prescriptions were not for animals examined by the Respondent and determined to be in need of Dilaudid but were prescribed for Ken Williams. Prior to August, 1982, Ken Williams had been convicted of possession of Dilaudid in violation of Florida Statute 893.13. (See Petitioner's Exhibit 6.) The Respondent had no knowledge of Ken Williams' drug conviction when he wrote the prescriptions described above. The Respondent received no compensation for writing the five prescriptions. Even after concluding the Dilaudid tablets were not being used by Ken Williams for an animal, the Respondent wrote the prescriptions on October 6, October 28, and November 22, 1982, because he feared Ken Williams would report him. Respondent was made aware by Ken Williams that Mr. Williams was using the Dilaudid himself for pain. The active ingredient in Dilaudid is Hydromorphone, a controlled substance listed in Schedule II of Florida Statute 893.13. The Respondent has been a practicing veterinarian for 15 years with 13 of those years having been in Florida. He has no previous charges or complaints against his license.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That a final order be entered by the Board of Veterinary Medicine requiring the Respondent to pay an administrative fine of $750.00. DONE and ENTERED this 12th day of August, 1983, in Tallahassee, Florida. MARVIN E. CHAVIS, 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 12th day of August, 1983. COPIES FURNISHED: James H. Gillis, Esquire Mr. Fred Roche Department of Professional Secretary Regulation Department of Professional Regulation 130 North Monroe Street 130 North Monroe Street Tallahassee, Florida 32301 Tallahassee, Florida 32301 Robert A. Young, Esquire Ms. Jane Raker Wilkins, Moorman & Young Executive Director Post Office Box 428 Board of Veterinary Medicine Bartow, Florida 33830 130 North Monroe Street Tallahassee, Florida 32301
Findings Of Fact Petitioner is a pharmacist doing business as Dyal's Pharmacy in Daytona Beach, Florida. Petitioner is a Medicaid provider under the rules of the Respondent, operating under Provider No. 1018147. Respondent is a department of the State of Florida, with its principal office in Tallahassee, Leon County, Florida. Respondent is designated as the state agency responsible for the administration of Medicaid funds, and is authorized to provide payments for medical services, pursuant to Section 409.266, Florida Statutes. Pursuant to his responsibilities as a Medicaid provider and a pharmacist, Petitioner has, during the period of March, 1982, through August, 1983, filled 43 prescriptions for nonsteroidal anti-arthritic drugs other than buffered aspirin, which did not have the words "medically necessary" written on the prescription form by the prescribing physician in his own handwriting. Petitioner filed claims with Respondent with regard to the aforementioned prescriptions, and Respondent paid $854.44 to Petitioner as reimbursement. By letter received by Petitioner on December 27, 1983, Respondent has notified Petitioner of its intention to seek repayment of that amount pursuant to Rule 10C- 7.42(4)(b), Florida Administrative Cede. Rule 10C-7.42, Florida Administrative Code, provides, in pertinent part, as follows: (4) Covered Benefits * * * (b) All prescriptions for buffered or enteric coated aspirin must indicate that an arthritic condition is being treated and dispensed in quantities no less than 200. Any nonsteroidal anti-arthritic drug, other than buffered aspirin, must have `medically necessary' written on the prescription by the practioner in his own handwriting. Noncompliance will warrant recoupment. Petitioner has sought an informal hearing regarding Respondent's attempt to recoup amounts previously paid to Petitioner, but in light of the provisions of the challenged rule it is unlikely that he can prevail. The existence of Rule 10C- 7.42(4)(b) is the only basis upon which repayment could be demanded by Respondent from Petitioner. The Florida Medicaid Program is administered through Respondent. In order to receive federal matching funds, Respondent must implement certain mandatory services for indigent. Other services which may qualify for federal funds are optional, and the state may cheese not to implement those programs. The pharmacy program, which this rule purports to regulate, is one such optional service which the State of Florida has chosen to implement. Funds utilized in the Medicaid Program are controlled by the legislature through funding of Respondent's budget. To regulate its budget, Respondent regularly reviews utilization and implements cost containment in various program. In 1981, Respondent was required to reduce its budget, and approximately $2 million of that reduction was required to be made in the Medicaid Program. In considering various options to reduce the Medicaid budget by this amount, the Department reviewed the pharmacy program budget which is the third largest in the Medicaid Program. Options such as limiting the number of prescriptions and requiring full payment were considered since these options had been implemented in other states. Such restrictions were not initiated, however, because Respondent felt that the large elderly population in Florida would forego taking necessary medication and endanger their health. Specific medications which were being paid for through the prescribed drug program were reviewed and certain drugs were eliminated from reimbursement under the program when prescribed for specified reasons, and other drugs were eliminated completely. These categories eliminated were chosen which would have the least detrimental effect on recipients. Additionally, Respondent, in consultation with physicians and pharmacists, considered the use of nonsteroidal anti-inflammatory drugs for the treatment of arthritis. While the drug of choice for treatment of arthritis is aspirin, because it is more effective than most nonsteroidal anti-arthritics, these nonsteroidal anti-arthritic drugs may be necessary for some patients who can't take aspirin. The number of persons who require such drugs instead of aspirin is small, however, and would not justify the large percentage of prescriptions for the nonsteroidal anti-arthritics which Respondent had observed through administering the pharmacy program. Because of their relatively high cost, nonsteroidal anti-arthritic drugs were accounting for 9.6 percent of the pharmacy program budget. Instead of eliminating the entire category of nonsteroidal anti- arthritic drugs from reimbursement under the program, which some states have implemented, Respondent opted to add aspirin to the list of covered benefits when prescribed for arthritis, and to require that the term "medically necessary" be written by the physician on the prescription form for nonsteroidal anti- arthritic drugs in order to be eligible for Medicaid reimbursement. This procedure was initiated in an effort to direct physicians' attention to the cost differential between the two types of drugs to ensure that a physician was making a conscious decision when prescribing the more expensive nonsteroidal anti-arthritic medication. The term "medically necessary" was chosen because physicians were familiar with that phrase through its use under the Florida Generic Drug statute. In response to an inquiry from the Florida Medical Association concerning the use of the term "medically necessary, Respondent indicated to that group that the term "drug of choice" would be an acceptable alternative. The challenged rule had not been amended at the time of final hearing in this cause to reflect this alternative term, nor was there any indication of record that any group other than the Florida Medical Association had been notified of Respondent's policy choice in this regard.
The Issue The issue is whether Petitioner is entitled to a permit as a prescription drug wholesale distributor.
Findings Of Fact On August 29, 2007, Petitioner filed with Respondent an application for a permit as a prescription drug wholesaler establishment (Application). Pursuant to a change in the law effective July 1, 2008, this permit is now for a prescription drug wholesale distributor. The Application lists Boris Rios as the sole owner of Petitioner and its president and manager. The Application lists Alexander Valdes as the next highest-ranking employee with a title of certified designated representative (CDR). The Application requires Petitioner to list all persons who meet the following descriptions of affiliates: a) "a director, officer, trustee, partner, or committee member of a permittee or applicant or a subsidiary or service corporation of the permittee or applicant"; b) "a person who, directly or indirectly, manages, controls, or oversees the operation of a permittee or applicant, regardless of whether such person is a partner, shareholder, manager, member, officer, director, independent contractor, or employee of the permittee or applicant"; c) "a person who has filed or is required to file a personal information statement pursuant to s. 499.012(4), F.S., or is required to be identified in an application for a permit or to renew a permit pursuant to s. 499.012(3), F.S."; d) "the five largest natural shareholders who own at least 5 percent of the permittee or applicant . . ."; and e) "shareholder[s] owning 5% or more of the applicant." In response to this item, the Application states that Mr. Rios meets the criteria set forth in paragraphs a) through e), and Mr. Valdes meets the criteria set forth in paragraph b). Attached to the Application are Personal Information Statements for Mr. Rios and Mr. Valdes. Mr. Rios's Personal Information Statement discloses his employment, from July 2003 to July 2007, as a "sales mgr" with Worldwide Medical Supplies and Pharmaceuticals, Inc. (Worldwide). His statement includes a resume that states he was a "sales executive" for Worldwide from July 2003 to February 2004, a "purchasing/deliver[ies] manager" for Worldwide from February 2004 to May 2005, and a "sales manager" for Worldwide from May 2005 to July 2007. As sales manager, Mr. Rios stated that he "[o]ver looked all sales transactions for all sales reps (7 man sales force). Buy establishing sales strategies and product promotions to help increase our sales and profit margins. And keeping sales force motivated and inspired by creating incentives to reach goals." Mr. Rios's attached resume shows that he had been a sales manager for another pharmaceutical manufacturer from January 2001 to July 2003. Mr. Rios's statement also answers in the negative a question asking whether he, "or a company for which you were an owner, officer, director, or manager, has been fined or disciplined by a regulatory agency in any state (including Florida) for any offense that would constitute a violation of Chapter 499, Florida Statutes?" However, his statement answers in the affirmative a question asking whether he, "or a company for which you were an owner, officer, director, or manager, ever held a permit issued under Chapter 499, Florida Statutes, in a different name than [Petitioner's name]?" However, on a mostly blank page entitled, Additional Information," Mr. Rios handwrote that he was employed by Worldwide from July 2003 to July 2007 as the sales manager of seven salespersons from May 2005 to July 2007, as the purchasing manager from February 2004 to May 2005, and as a sales representative from July 2003 to February 2004. Mr. Valdes's Personal Information Statement discloses his employment with Worldwide from 2003 to present as a "sales mgr" and "D Rep," meaning certified designated representative. Inserted in the Application is a letter dated May 30, 2008, from Mr. Valdes to Rebecca Burnett, an employee of Respondent, stating that he was "hereby submit[ting] my resignation from Worldwide . . . effective May 30, 2008 " Mr. Valdes's Personal Information Statement contains a long typewritten statement that says he was employed at Worldwide since 2003 in "various positions," starting as a sales person, then a sales manager, and finally a CDR, following his preparing for and passing the certification test. At about the same time, a newer Worldwide employee, Rick Nielsen, also took the CDR test, passed, and became a CDR for Worldwide, working a different shift from Mr. Valdes. Mr. Valdes stated that he often ordered Worldwide not to accept or to return a product due to product-safety issues, and he helped state inspectors in their investigations concerning these matters. However, on the Personal Information Statement itself, Mr. Valdes answered in the negative a question whether he or any company for which he had been a manager had been fined or disciplined by a regulatory agency. By letter dated September 8, 2008 (Denial Letter), Respondent advised Petitioner of its intent to deny the application. Among the reasons cited for denial are that Petitioner listed Mr. Valdes as its CDR. The Denial Letter states that, in Final Order Number 08-1216, Respondent found 37 violations of the Florida Drug and Cosmetic Act, Chapter 499, Florida Statutes, and revoked the permit of Worldwide Medical Supplies and Pharmaceuticals, Inc. (Worldwide), to operate as a prescription drug wholesale distributor. According to the Denial Letter, Mr. Valdes was Worldwide's CDR from August 2005 to May 2008 and sales manager from April 2003 to May 2008; he is also the son of the president and owner of Worldwide, Miriam Gonzalez. The Denial Letter states that Mr. Valdes was listed on the Application as a key employee of Worldwide and did not submit to Respondent his resignation as Worldwide's CDR until May 30, 2008. The Denial Letter asserts that, on four occasions from July 18 to November 8, 2005, Mr. Valdes received and authenticated a pedigree that was not authenticated, so that Worldwide failed to keep the required records of prescription drug transactions. The Denial Letter states that, on six occasions between October 17 and 31, 2005, Mr. Valdes or another Worldwide employee falsely represented under Mr. Valdes's signature that a pedigree had been presented to Worldwide and authenticated by Mr. Valdes, but Worldwide had not received the complete and accurate pedigrees and had not maintained them. The Denial Letter states that receipt of the drugs without a complete or accurate pedigree caused the drugs to be deemed adulterated. The Denial Letter states that, on August 16 and September 23, 2004; and September 25, October 16, and October 27, 2006, Worldwide purchased a prescription drug from an unlicensed manufacturer or wholesaler. The letter states that this activity constituted the purchase of contraband in commerce and was detrimental to the public health. The Denial Letter asserts that Mr. Rios was an affiliated party of Worldwide at all material times. The Denial Letter states that Mr. Rios owns Petitioner and provides financial support and assistance to Petitioner, so he is an affiliate of Petitioner. The Denial Letter states that Respondent found that Petitioner was not entitled to licensure under Section 499.012(4)(d)9, Florida Statutes. The Denial Letter states that, pursuant to Section 499.012(10)(b), Florida Statutes, Respondent may deny an application if it finds that the managers, officers, or directors of the applicant or an affiliate of the applicant are incompetent or untrustworthy. Based on the facts set forth above, Respondent finds Mr. Valdes, an affiliate, incompetent or untrustworthy. The Denial Letter states that, pursuant to Section 499.012(10)(g), Florida Statutes, Respondent may deny an application if it finds that the applicant is affiliated, directly or indirectly through ownership, control or other business relations, with any person or persons whose business operations are or have been detrimental to the public health. Based on the facts set forth above, Respondent finds Mr. Valdes is an affiliate whose prior business operations are or have been detrimental to the public health The Denial Letter states that, pursuant to Section 499.012(10)(r), Florida Statutes, Respondent may deny an application if it finds that the applicant or any affiliate has failed to comply with the requirements for manufacturing or distributing prescription drugs under Chapter 499, Florida Statutes. The Denial Letter asserts that Section 499.003(3), Florida Statutes, defines an affiliate to be a person who has filed or is required to file a personal information statement or a person who, directly or indirectly, manages, controls, or oversees the operation of a permittee or applicant, regardless whether such person is a partner, shareholder, manager, member, officer, director, independent contractor, or employee of the permittee or applicant. The Denial Letter states that Respondent finds that Mr. Valdes, while employed at Worldwide, failed to comply with the laws related to the distribution of prescription drugs while having a duty to be actively involved in and aware of the actual daily operation of the company. The Denial Letter states that Mr. Valdes had a duty to be actively involved in and aware of the actual daily operations of the company. The Denial Letter states that, while Mr. Valdes was CDR for Worldwide, the company purchased prescription drugs from an unauthorized source, in violation of Section 499.005(16), Florida Statutes; failed to maintain records of prescription drug distributions as required by Florida Administrative Code Rule 64F-12.012(6) and (10), in violation of Section 499.005(18), Florida Statutes; accepted or maintained incomplete or nonexistent pedigrees and sold drugs to unlicensed persons, thus violating the adulterated-drug provisions of Section 499.005(1), (2), and (4), Florida Statutes. The Denial Letter states that, pursuant to Section 499.012(10)(m), Florida Statutes, Respondent may deny an application if the applicant or affiliate receives, directly or indirectly, financial support and assistance from a person who was an affiliate of a permittee whose permit was subject to discipline or suspended or revoked. The Denial Letter states that Petitioner receives financial support and assistance from Mr. Rios, who was an affiliate of Worldwide and is an affiliate of Petitioner. The Denial Letter states that, at all material times, Worldwide engaged in business operations that were detrimental to the public health by purchasing adulterated prescription drugs and by adulterating prescription drugs. Worldwide filed a renewal application on May 17, 2007, for a renewal term from July 1, 2007, to June 30, 2008. The renewal application lists Ms. Gonzalez as the company's sole shareholder and manager. The only persons listed among the next four highest-ranking employees are Mr. Valdes, who is listed as the CDR and "Longistic [sic] Manager" and Mr. Rios, who is listed as "Purch/Sales Director." Each man is reported as "a person who, directly or indirectly, manages, controls, or oversees the operation of a permittee " Sometime in 2007, Respondent commenced a disciplinary proceeding against Worldwide. In its Second Amended Administrative Complaint dated August 24, 2007, Respondent alleged that Worldwide violated Sections 499.001 through 499.081, Florida Statutes, based on documents that it had prepared during 2004-06. A formal hearing took place on February 11 and 12, 2008, and Administrative Law Judge Patricia M. Hart entered a Recommended Order on May 1, 2008, which was adopted in its entirety by Final Order entered October 12, 2008 (FO). The Final Order finds Worldwide guilty of 37 violations of Chapter 499, Florida Statutes, imposes administrative fines of $185,000, and revokes Worldwide's permit as a Prescription Drug Wholesaler. The Final Order (FO) was never appealed. The FO finds multiple acts and omissions attributable to Worldwide in the handling of prescription drugs shipped to it or, in some cases, purchased by it. Concerning incomplete and thus fraudulent authentications of pedigree papers, these acts and omissions ranged from February to April, June to September, and December 2004; and April to November 2005. Only seven of these violations occurred in 2004; the rest were in 2005. Concerning purchases from unlawful persons, of which there were a dozen, these acts and omissions took place in August 2004, December 2004, June 2005 (two), April 2006, September 2006 (two purchases from Kuehne & Nagel) October 2006 (four purchases from Kuehne & Nagel), and March 2007. Mr. Valdes is named in connection with six of the unlawful transactions. For October 2005 (except for one transaction in November 2005, as indicated), the FO found a pedigree paper bearing a "stamp" showing receipt and authentication by Mr. Valdes of 35 6GM vials of Carimune was incomplete and thus "false," a pedigree paper bearing a "stamp" showing receipt and authentication by Mr. Valdes of seven 10ML units of Baygam as incomplete and thus "false," a pedigree paper bearing a "stamp" showing receipt and authentication by Mr. Valdes of 15 12GM vials of Carimune as incomplete and thus "false," a pedigree paper bearing a "stamp" showing receipt and authentication by Mr. Valdes of 100 2ML units of Baygam was incomplete and thus "false," a pedigree paper bearing a "stamp" showing receipt and authentication by Mr. Valdes of 100 units of Gammar P as incomplete and thus "false" (November 2005), and one pedigree paper bearing a "stamp" showing receipt and authentication by Mr. Valdes of one 2ML unit of Baygam SDV and three 10CP units of Tamiflu 75MG was incomplete and thus "fraudulent." In his responses to requests for admission in this case, Mr. Valdes admits that he received and authenticated the pedigree paper, on October 10, 2005, for Carimune; the pedigree paper, on October 18, 2005, for Baygam; the pedigree paper, on July 18, 2005, for Baygam; and the pedigree paper, on November 8, 2005, for Gammar P. Worldwide never employed many employees, perhaps never more than 8-10. Ms. Gonzalez owned the company, but reduced her interest to 51 percent from February 2004 to December 31, 2006, during which period Mr. Nielsen owned 49 percent. However, Mr. Nielsen terminated his employment with Worldwide on December 31, 2006, and evidently relinquished his interest in the company at that time. Upon initial employment, Mr. Nielsen occupied a position in which he supervised the purchasing manager, Mr. Rios, who, even though called a manager, supervised no one. At that time, Mr. Rios was lower-ranking than Ms. Gonzalez, Mr. Nielsen, Mr. Valdes, and possibly another employee. At some point, Mr. Nielsen was designated a CDR for Worldwide, and he remained a CDR for Worldwide until he left employment with the company. Prior to that, Mr. Gonzalez had served as the CDR for Worldwide. Mr. Valdes also served as a CDR for Worldwide. Based on his responses to requests for admission, Mr. Valdes started as CDR for Worldwide in August 2005, so he and Mr. Nielsen were both CDRs for Worldwide at the same time. Mr. Valdes served until the end of July or early August 2006, when, dissatisfied with his employment situation, he terminated his employment. Mr. Valdes did not return until early January 2007 when his mother needed him to serve as CDR again because Mr. Nielsen had left, and no one remaining with Worldwide could pass the test to become a CDR. Mr. Valdes produced testimonials from various persons, such as a former drug agent supervisor of Respondent and current investigators of Medicaid fraud, who commend him for assisting in combating fraud in the wholesale pharmaceutical industry. However, at the hearing, Mr. Valdes never explained how he was not at fault or responsible for the violations in which the paperwork bore his stamp or other violations taking place, particularly while he was CDR. Mr. Valdes was sales manager during the 2004 violations and a CDR during all of the bad-pedigree transactions from August to December 2005, as well as one bad-purchase transaction in April 2006. He had sizable responsibilities during a timeframe that many violations were taking place at Worldwide, and, despite the three commendations and candid demeanor at the hearing, does not appear to have done a good job discharging these important duties. As confirmed by Ms. Gonzalez, Mr. Rios was the sales manager from May 2005 to July 2007, and he had supervisory authority over a sales staff that, at most, numbered seven persons. Mr. Rios could hire and fire salespersons, but he had no contact with the prescription drugs. From February 2004 to May 2005, Mr. Rios was purchasing manager, but worked under the supervision of Mr. Nielsen and lacked any managerial duties.
Recommendation It is RECOMMENDED that the Department of Health enter a final order denying the application for a permit as a prescription drug wholesale distributor until Mr. Rios substitutes a qualified CDR for Mr. Valdes--a condition that the Department of Health should allow Mr. Valdes a reasonable time to satisfy. If Mr. Rios cannot submit the name of a qualified CDR within such time, the final order should provide for the denial of the application without prejudice to refiling at a later date with a qualified CDR. DONE AND ENTERED this 9th day of March, 2009, in Tallahassee, Leon County, Florida. ROBERT E. MEALE 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 9th day of March, 2009. COPIES FURNISHED: Alexander Valdes, Qualified Representative 14052 Southwest 80th Street Miami, Florida 33183 Gary L. Asbell, Esquire Department of Health 4052 Bald Cypress Way, Bin A02 Tallahassee, Florida 32399-1703 Rebecca Poston, R.Ph., Executive Director Drugs, Devices, and Cosmetics Program Department of Health 4052 Bald Cypress Way, BIN C04 Tallahassee, Florida 32399-1701 R. S. Power, Agency Clerk Department of Health 4052 Bald Cypress Way, BIN A02 Tallahassee, Florida 32399-1701 Josefina M. Tamayo, General Counsel Department of Health 4052 Bald Cypress Way, BIN A02 Tallahassee, Florida 32399-1701
