CVS Fined by DEA over PSE Sales

    The next time someone complains to me about the pseudoephedrine sales restrictions they must go through to buy the cough and cold product of their choice I will bring up this story as an example of how serious the government is about the sale of pseudoephedrine (PSE).  It appears according to a story I just found on Yahoo that CVS has been fined $75 million by the U.S. Drug Enforcement Agency (DEA) for illegal sales of PSE to criminals that in turn used the medication to make methamphetamine. 

    The Yahoo article sites that the illegal PSE sales occurred in southern California and resulted in an increase in the methamphetamine problem for that area’s law enforcement agencies.   Not only did CVS receive “the biggest ever civil penalty under the Controlled Substance Act” according to Yahoo but apparently CVS also has agreed to pay back some $2.6 million in profits resulting from the PSE sales.  And if CVS made that much profit on those illegal sales we are talking about a large amount of PSE which means those illegal sales contributed to a large amount of illegal methamphetamine production.  And to me that is a disgrace!

    What bothers me most about the Yahoo article is the accusation that CVS only changed it’s PSE sales procedure only after becoming aware that the company was under investigation by the government.   It is as if CVS would have continued to illegally sell a product that is a known ingredient for illegal drug production had it not come under investigation by the DEA.  To me this is nothing short of a disgrace on the part of CVS management but honestly I don’t know why I am even surprised by the story.  After all, CVS has shown time and time again that they don’t want to play by the rules that everyone else is bound to follow. 

    For a large chain to knowingly sell PSE to criminals that will inevitably turn the product into illegal drugs that will be sold on the street is just the utmost definition of irresponsible and reckless behavior on the part of CVS.   I personally am glad that the DEA came down on them this severely and they did so the only way to really hurt a company such as CVS: financially.   Forget moral or ethical responsibility because CVS said bye bye to those concepts a long time ago.  The only way to effectively send a message to a company like CVS is to issue a meaningful fine to send them the message that just selling PSE haphazardly is not an option.  And that is exactly what the DEA has done with it’s $75 million dollar fine.  

    Now some of you might say that even $75 million isn’t enough but I think when you are talking about that kind of large sum of money you have to agree that it will sting even a company the size of CVS.   The message hopefully will be received by the management at CVS.   I think that organization needs a major reorganization with several executives being removed.  CVS is an embarrassment for the entire pharmacy distribution industry and these kinds of actions brings down the entire profession and goes against what most everyone in the industry believes in: to do everything in our power to PREVENT the production and distribution of illegal drugs.  

   So if anyone out there works for CVS feel free to print this post and fax it or e-mail it to your corporate headquarters.   And be sure to highlight the following:  CVS is an embarrassment to the chain drug store industry.   They have proven time and time again that they put greed and profits over ethics and moral responsibilities.   And I for one am glad the DEA has come down hard on them.  It was a long time overdue in my opinion.  And if you think I am being too harsh towards CVS feel free to leave a comment defending them but you’d better have some facts to back up your claims because there are several examples I can think of where CVS has been plain wrong.  

    This is just another example of why I can never work for CVS and why some chains just think they can do whatever they want in the name of profits.  I hope that every pharmacist that works for CVS really gives their corporate leaders an earful regarding their behavior.  They definitely deserve it.  And kudos to the DEA for conducting their investigation and handing down such a large fine as punishment.  And if that doesn’t work the next time this sort of thing happens try for $100 million fine or maybe $150 million.     Just keep raising the penalty until companies like CVS finally get the message that they have to play by the rules too.  Maybe they will eventually get the message.  Who knows?   

The Redheaded Pharmacist

14 Comments to “CVS Fined by DEA over PSE Sales”

  1. By Lisa, October 15, 2010 @ 11:28 am

    Those of us who work for CVS and are diligent about obeying all laws governing the practice of pharmacy, no matter what the company policy may be, are offended that you group us under the encompassing umbrella of “CVS.” Your opinions are your own, but to state that CVS is an embarrassment to the practice of pharmacy includes those of us who do our job and obey the rules day after day after day. In the current economy, some of us don’t have the luxury of a choice of company to work for. We have to take the jobs that are available and do our best to insure that laws are not broken and that rules are followed. The fines you are speaking of are for practices that occurred in California and Nevada in 2007. Don’t make it sound like this fine is regarding the entire company, and the entire country. By doing so, you imply that none of us who work for CVS can not be trusted, and that all we are interested in is the customer’s dollar. By making blanket statements like this, you’re further undermining what little credibility we have, and costing us the little bit of respect that we may get from our customers. And those of us who work so hard every day and play by the rules, and care about our customers, deserve that respect. PS I sure hope you don’t ever find yourself in need of a job and have to turn to CVS. I’m pretty sure they won’t be interested. If we fax or e-mail your opinions to our supervisors or corporate headquarters, I’m pretty sure they won’t care about that, either. And by the way, you’ve made me angry for the last time. I won’t be following you on Facebook, or reading your blog any longer.


  2. By The Redheaded Pharmacist, October 15, 2010 @ 11:47 am

    My problem is with management not the staffs at the individual pharmacies. The breakdown that allows such a large breach of policy happens higher than the store level. My comments were directed towards the top of the organization.


  3. By BCMIGAL, October 15, 2010 @ 12:38 pm

    Here is your second comment in defense of CVS. CVS is anal, obsessive, and even brutal about following rules, regs, and its own policies and protocols. If an employee displays even a hint of being a liability, you can bet your last dollar that he/she will be history. So to insinuate that those of us who are part of the company also behave in a criminal manner does little to bolster our efforts to earn respect from the public.

    That 75 million is just a sneeze to a company with 7000 stores and a PBM. No opinion of mine or yours is going to change corporate policy. However, bad publicity does seem to be feared.

    Lisa is right. We work out buns off every day with a “skeleton” crew and a growing list of required tasks that cannot be delegated. All this, while maintaining our professional and personal integrity. You should blog about the pharmacists who manage to maintain their sanity.


  4. By rphmelly, October 15, 2010 @ 12:51 pm

    True, the fines are only in CA and NV, but is that because other states have not yet been investigated? Let’s not forget the investigations into Caremark’s practices as well…

    Excellent post.


  5. By The Redheaded Pharmacist, October 15, 2010 @ 1:22 pm

    The reports I found online stated that the questionable sales occured in L.A. County, Orange County, CA and Clark County, NV. And the violations were numbered in the “thousands” according to the news stories I’ve read on the subject. That is a lot of questionable sales of PSE! And again, my negative comments at CVS were directed at CVS corporate and not the individual staffs at the CVS stores around the country. For an error of this magnitude to happen at any chain there has to be serious issues with the top management of the company involved. I hope this kind of story sends a message to all of us that are responsible for the sale of PSE that the restrictions and regulations are in place for a reason and that we should take those restrictions seriously. We all need to collectively be part of the solution to the meth problem instead of part of the problem!


  6. By ikonika, October 15, 2010 @ 3:04 pm

    $75 million is a just a drop of a drop in the bucket for a company like CVS. Their profit over the past fiscal year was somewhere around $3.5 billion. If federal prosecutors really wanted to make a statement, they should have fined/jailed the management that knowingly allowed this to happen. In the end, CVS will still be making impressive profits and there will be just as much meth out on the streets.


  7. By Unchained Pharmacist, October 15, 2010 @ 4:36 pm

    It would be hard to believe that whatever infraction CVS did would be limited to only California and NV. Big corp like CVS would have standard Policies and Procedures for all the stores.

    Unfortunately for the general public, this casts doubts on the integrity of the company and by extension everyone who works there. It is really sad that we can have CVS participate in an episode of Undercover Boss.

    On a side note, most pharmacists I know, CVS or not, enjoys telling those people (and yes, we know who they are, but profiling is another topic altogether), No Sudafed for you! Come back in 1 month! (a la Soup Nazi).

    So to recap, CVS corporate officers screwed up, ruin the reputation of every store front employee including pharmacists. The fine, which will likely increase as DEA finds more infractions which will hurt the bottom line leading to tanking stocks. This is on top of any price drop caused by the incident itself. Employee’s 401k’s and stock options take a hit, then CVS comes out to cut even more hours to help weather tough times.
    Come to think of it. You can pretty much substitute CVS with other ticker symbols (WAG, WMT, RAD, etc).

    Can you detect a “hint” of my hostility towards big corp?


  8. By lovinmyjob, October 15, 2010 @ 7:32 pm

    Regardless of who is to blame or where it is happening, the real problem is methamphetamine production. If the DEA were really serious about curtailing this issue they would recommend to the FDA that PSE products be made RX only. I know that sounds drastic but I know I hate having to make an instant judgement call as to whether or not to sell these products to any given person at any given time. I hate being the gatekeeper/watchdog of the PSE products. I’m not a cop!! I’m tired of being treated like one only without the bullet-proof vest and gun on my hip! Somehow I think there was much more to this story than “illegal sales”. If someone comes to my store 4 days in a row with 4 different ID’s and I sell to them each time it is technically illegal even though I followed all the rules. I don’t know about anyone else but I can’t remember the faces of every crack-head in my town to know that I just sold to them yesterday.


  9. By Jade, October 15, 2010 @ 8:17 pm

    When I read the Yahoo! story I had only a few thoughts…someone wants to prove a point and why not let CVS take the fall since it’s already in hot water with a lot of pharmacists (most people have no problem kicking someone when they’re down already) and, how did they come up with the piddling fine?

    I filled in as relief in several major chain stores, in small midwest towns off major interstate and I had serious doubts that the situation I came into met the requirements of the law, especially when PSE transactions were chiefly handles by techs and there was no pharmacist intervention, so I would be hard put to say unless CVS had been swarmed by teams of PSE garnering gangs and deliberately witholding the PSE purchase documents from the Feds, that this might be a DEA warning shot to a company that could ‘handle’ the flickonthewrist fine.

    Of a far greater ominous sign was the story recently in the news about the Armenian ‘Mob’ that amassed millions of criminal actions through Medicare fraud.

    In the wake of a recent compromised decision to keep the Federal government out of mediating health care regulations and continue the downward spiral of kowtowing to health insurers, I think that the PSE issue with CVS is only a tio-of-iceberg sign that without some central point in the nation’s healthcare debate, a database, consistently shared patient resources, standard e-prescribing program, drug price-controls, etc. whatever we have left after the fallout is something less than before.

    How can a single patient be prevented from purchasing hundreds of narcotics in several different states if paying cash? How can internet sales of restricted drugs be eliminated? How can problems like sole providers of vaccinations not resist unfair price gouging especially if they choose or effect limited supply of sole-provider drugs?


  10. By BCMIGAL, October 15, 2010 @ 9:38 pm

    Jade… I have had a personal experience with this “Mob”. The prescription forms were obtained using an MD’s stolen information. They are the genuine “secure” forms required in California. A “runner” is hired to drop off the RX. He/she is usually a clean cut, ordinary looking person who is taking care of mom, grandma, auntie who just had some serious surgery or injury and needs pain meds. There is no rush, no idle chatter, no waiting around. The person says they will be back in an hour with the Part D info (also stolen) The Rx is even dropped off during regular business hours. The Md’s office is called and the rx is verified. Mr Ordinary person returns, Medicare is billed, copay is obtained, and Mr. OP goes off with the meds for $3.30. Weeks later, Medicare fraud investigator calls…..


  11. By McFury, October 16, 2010 @ 8:07 am

    Lets be honest though, $75 million dollars is nothing to CVS. But you know who will suffer for this? The retail staff who already tapped out at a 2% raise this year will get NOTHING next year while the CEO and president make $20 million in bonus and stock options.


  12. By BCMIGAL, October 16, 2010 @ 2:16 pm

    McFury…what you say is true…..heads will roll at the stores involved…if the stock price goes down due to negative publicity, the result will be even more staffing cuts with the same level of expectation in productivity….we should be careful what we wish for…


  13. By Cooper, October 29, 2010 @ 12:35 pm

    I have worked with CVS for years from the time I was in college and still now, as I am a licensed pharmacist. And for years CVS has had a proper policy on the sale of PSE. This IS limited to those stores (and not all of them) in CA and NV.

    Also, and more importantly, what you aren’t realizing is that when this was happening those stores weren’t actuall CVS pharmacies. I don’t remember what pharmacy they were, but CVS bought them, obviously unaware of what was happening at those stores. And now, since we own them, we are the ones hit with the fines. I’m curious as to how much we (CVS) paid for the chain.


  14. By Owner, February 12, 2011 @ 11:03 pm

    When you refer to a company, you speak to everyone in the organization. Accountability starts and ends with all involved so until this occurs, this industry issue will continue.
    The problem with PSE is not an issue at the chain drug level, its at the government level. There is a lack of collaboration between retail and government to resolve these issues while the government seeks a finger to point first and a fine to levy second. Its the american way when you are the largest hiring body that isnt required to turn a profit, but cant print more money and raise taxes at will.
    I find it most interesting that our industry partners are happy we are paying a fine instead of joining in a protest, which will send the rabid wathdog to their door next.
    Remember, when you point the finger, the thumb is pointing back at you, the most accountable person in the organization.


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