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Sober Nation

Putting Recovery On The Map

04-24-19 | By

First Major Drug Distribution Company Faces Same Criminal Charges as Drug Cartels

New York Times

Where the opioid crisis had first been seen in parallel with drug cartels, street dealers and king pins, now, for the first time ever, the government is cracking down on another drug kingpin believed to be responsible for the crisis – pharmaceutical companies.

On Tuesday, authorities announced that Rochester Drug Cooperative (RDC), the nation’s sixth-largest pharmaceutical distributor has become the first major company to face federal criminal charges in connection to the opioid crisis.

“This Prosecution Is The First of Its Kind”

According to the complaint from the U.S. Attorney’s office, Rochester Drug Cooperative has been charged with failing to report thousands of suspicious orders of oxycodone, fentanyl and other controlled substances, while also defrauding the federal government.

Along with the company, RDC’s former chief executive, Laurence Doud III, has been placed under arrest by federal drug agents and was expected to appear in Manhattan federal court on Tuesday. Doud has been believed to be the first pharmaceutical executive associated with the nation’s opioid crisis to face a criminal charge of diverting drugs for an illegitimate purpose.

Additionally, William Pietruszewski, the former chief of compliance, pleaded guilty in a narcotics distribution conspiracy from January 2012 to March 2017 earlier in the month.

“This prosecution is the first of its kind,” said Geoffrey S. Berman, the United States attorney in Manhattan. “Our office will do everything in its power to combat this epidemic, from street-level dealers to the executives who illegally distribute drugs from their boardrooms.”

These charges not only signify the seizure of a white collar company, but come as a groundbreaking stance by the government to combat the raging opioid epidemic, which kills 130 Americans daily, according to the Centers for Disease Control and Prevention. Hence, for the first time, executives and RDC were charged exactly like street dealers and drug traffickers.

“They Did Not Want to Risk Losing Revenue”

According to the New York Times, the Drug Enforcement Administration (DEA) investigated RDC for over two years, after the company violated terms of a previous civil settlement over opioids. However, as of Tuesday, the company entered into a non-prosecution consent decree under which RDC agreed to accept responsibility and pay a $20 million penalty while taking other actions, according to the Department of Justice.

“RDC knowingly failed to operate an adequate system to detect, investigate and report to the DEA suspicious orders of controlled substances,” the complaint states, noting that between May 2012 and November 2016, RDC filled more than 1.5 million controlled substance orders from its pharmacy customers. During this period, the distributor only reported four orders as suspicious and failed to flag at least two thousand suspicious orders, according to prosecutors.

“During this period, RDC shipped large quantities of opioids to pharmacies that RDC knew exhibited dispensing patterns that suggested the pharmacies were dispensing controlled substances for illegitimate medical purposes,” court records said. “They did not report suspicious orders or pharmacy customers to the DEA because they did not want to risk losing revenue from these customers.”

“We made mistakes,” company spokesperson Jeff Eller said, according to the Times, “and RDC understands that these mistakes, directed by former management, have serious consequences.”

“We accept responsibility for those mistakes. We can do better, we are doing better, and we will do better,” Eller said in a statement. “Not only do we pledge to honor the letter and spirit of these agreements, we are also putting into place a world-class compliance program.”

While this is the first time criminal charges have been put in place, it’s not the first time a drug distributor has faced legal consequences from the opioid crisis. Companies like Cardinal Health and CVS are all paying settlements and fines related to the epidemic, however the criminal charges come as a relief to advocates, officials, and anyone who’s been impacted by the opioid epidemic.

“This prosecution is the first of its kind: Executives of a pharmaceutical distributor and the distributor itself have been charged with drug trafficking, trafficking the same drugs that are fueling the opioid epidemic that is ravaging this country,” U.S Attorney Geoffrey Berman said. “Our office will do everything in its power to combat this epidemic, from street-level dealers to the executives who illegally distribute drugs from their boardrooms.”


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