Did the DEA Allow the Opioid Epidemic to Worsen?

By Paul Gaita 10/28/16

Washington Post investigation has made some startling allegations about the link between the DEA, Big Pharma and the opioid epidemic. 

Did Big Pharma Influence the DEA to Stop Chasing Prescription Drug Cases?
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While the epidemic of overdose deaths from prescription opioids claimed more than 100,000 people in a period of less than two decades, the Drug Enforcement Administration (DEA) scaled back efforts to halt the ceaseless flow of addictive prescription medications from wholesale distribution companies that sold the drugs, allegedly due to pressure from former Justice Department officials retained by the companies themselves.

These and other allegations about Big Pharma’s interference into federal investigations are the focus of a recent feature by the Washington Post, which is part of its ongoing series on the causes of the increasing mortality rate in small town America.

Through interviews with former agency supervisors and a review of internal records, the Post feature details how the DEA, through its Office of Diversion Control, sought to curb the distributors, doctors, pharmacies and “pill mills” that sold vast quantities of prescription drugs through a combination of compliance orders: the “order to show cause,” which allowed agency investigators to halt drug shipments from warehouses, and the “immediate suspension order,” which instantly froze shipments from facilities deemed an “immediate threat” by the agency. Using this method, the DEA successfully levied cases against major distributors, including the largest drug distributor in the country, McKesson.

But a 2011 case against Cardinal Health, one of the three largest U.S. distributors, highlighted how the companies were pushing back against federal intervention. Joseph Rannazzisi, who headed the diversion office at the time, was confronted by then-Deputy Attorney General James M. Cole, who demanded to know why former Justice Department attorneys, now working for Cardinal and CVS—which was also involved in the case—had contacted his office about the investigation, and why Diversion Control was targeting corporations. Rannazzisi refused to halt the case, which eventually resulted in a settlement from Cardinal and a $22 million fine to CVS. 

Soon after, DEA field offices across the country began complaining that agency attorneys in charge of approving cases were requesting additional evidence before investigators could pursue cases against distributors. The gridlock became so predominant that civil case filings dropped from 131 in 2011 to just 40 in 2014, while immediate suspension orders plummeted from 65 to nine during the same period.

Making matters worse, the Justice Department sought to organize meetings with representatives from distribution and pharmacy chains—including companies that had been investigated by the DEA or were in the midst of settlement negotiations—to bolster relations between the two entities.

Rannazzisi was ousted from his position in 2015 after combative testimony before a House Judiciary subcommittee on regulatory reform. He had vocalized opposition to the Ensuring Patient Access and Effective Drug Enforcement Act, which would limit the DEA’s ability to pursue drug distributors. The bill had been the subject of $13 million worth of lobbying by the Healthcare Distribution Alliance (HDA), an association that included distributors like McKesson and Cardinal.

In an interview with the Post, Rannazzisi recalled saying before the committee, “This bill passes the way it’s written [and] we won’t be able to get immediate suspension orders, we won’t be able to stop the hemorrhaging of these drugs out of these bad pharmacies and these bad corporations. What you’re doing is filing a bill that will protect defendants in our cases.” 

Rannazzisi retired soon after he was removed from his position last year. The bill became law this year, and the Justice Department began meeting with drug distribution and pharmacy chain representatives. “[The Healthcare Distribution Alliance] is pleased with the willingness of the new leadership at the DEA to meet with and engage registrants, and is encouraged by the Administration’s desire to ‘reset the relationship’ with our industry,” said HDA president and chief executive John M. Gray to the Post.

Rannazzisi saw the policy change in a different light. “This idea that they’re going to say, ‘I’m sorry I violated the law, give me another chance and I’ll make it right,’ without having some type of punishment, to me is outrageous,” he said. “Every time I talked to a parent who lost a kid, I’m pretty sure they didn’t want me to say, ‘Oh, give them another chance because corporate America needs another chance.’”

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Paul Gaita lives in Los Angeles. He has contributed to the Los Angeles Times, Variety, LA Weekly, Amazon.com and The Los Angeles Beat, among many other publications and websites.