Government Struggles to Hold Opioid Manufacturers Accountable

Government Struggles to Hold Opioid Manufacturers Accountable

For the first time ever, the U.S. DEA targeted a prescription drug manufacturer for their role in black market opioids and damages incurred. Mallinckrodt Pharmaceuticals, one of the largest national manufacturers of the highly addictive generic painkiller oxycodone, one of the leading drugs responsible for the more than 15,000 overdose deaths in 2015, was accused of shirking its responsibility to report suspicious drug orders.

Who’s to Blame For The Opioid Epidemic?

Created at Mallinckrodt’s Hobart, NY facility, oxycodone shipped via its distributor network, including KeySource, Sunrise Wholesale and Cardinal Health, who later supplied the pills to retailers, including pharmacies and hospitals accused of illegally diverting the drugs. Discovered in a 2009 Tennessee Drug Task Force sting and linked back to Mallinckrodt’s distributors Florida retailers, 2010-2011 DEA investigations uncovered large amounts of Mallinckrodt oxycodone – such as the 41 million KeySource Medical oxycodone tablets delivered to Florida retailers in 2010 – about 2.5 pills for every man, woman and child in the state. Accused of splitting orders to conceal shipment amounts, KeySource was ordered by the DEA to halt, later relinquishing its distribution license. Distributors Sunrise Wholesale and Cardinal Health likewise delivered vast quantities of Mallinckrodt’s oxycodone to pharmacies in Florida. 500 million Mallinckrodt pills ended up in Florida from 2008-2012 — 66% of state oxycodone sales. A 2011 subpoena following this the discovery further revealed, 6 weeks after the Tennessee task force alerted Mallinckrodt to the drugs found in the 2009 sting, Mallinckrodt shipped another 2.1 million tablets their Sunrise distributor, 92,400 tablets of which were sold to Dr. Barry Schultz, the Delray Beach doctor whose oxycodone was found in Tennessee. Schultz was later convicted of drug trafficking and manslaughter (for a related overdose death). In one day, he prescribed 1,000 tablets to a single patient. Ultimately, the DEA and federal prosecutors alleged Mallinckrodt ignored its responsibility to report suspicious orders, in violation of the Controlled Substances Act.

Shirking Responsibilities?
Under federal law and DEA policy, pharmaceutical companies are required to “know their customers,” monitoring amounts, frequencies, and patterns of drug orders, immediately notifying the DEA of suspicious activity – or risk losing their license to manufacture and sell controlled substances, as well as civil and criminal penalties. Though Mallinckrodt maintained publicly the company has worked hard to fight drug diversion, internal case summaries prepared by federal prosecutors indicated Mallinckrodt’s response was that ­‘everyone knew what was going on in Florida but they had no duty to report it.’ Sources familiar with settlement talks indicated Mallinckrodt acknowledged its responsibility to report suspiciously large orders, but contended the DEA did not require manufacturers to know about (or be responsible for) ‘their customers’ customers,’ further pointing to conflicting DEA advice as to legal responsibilities. Prosecutors considered a whopping 43,991 unreported orders from distributors and retailers suspicious.

Uncharted Waters
Appalled by the rising opioid death toll, the DEA’s push to hold drug manufacturers accountable was hoped to be a wake-up call, putting the industry on notice for its responsibilities in the diversion of drugs to the black market. Instead, after years of industry investigations spanning five states to build the massive case, the results mirrored the DEAs previous attempt to hold wholesale distributors accountable. The case stalled. Fierce company resistance and intense lobbying efforts may have played a role in the lack of legal action pursued. The case settled for $35 million in fines and no admission of wrongdoing.

Small Potatoes
The proposed settlement, a mere fraction of the 44,000 federal violations pointed to in the investigation which could have cost the company $2.3 billion in fines, amounts to small potatoes for a company that posted $3.4 billion in revenue and $489 million in profit in 2016. In a later February 2017 SEC filing, Mallinckrodt even noted the investigation “will not have a material adverse effect on its financial condition” because it had set aside the funds.

About the Author: Anthony Sambucini is a founding principal and the Chief Executive Officer of ANS Solutions. Anthony specializes in bridging the goals of clinical innovation and business strategy that have helped propel ANS Solutions into a national leader in Pharmacotherapy Review Services for workers’ comp insurers and ANS Pharmacotherapy Review Program is the most advanced, results-oriented drug utilization review program in the industry. As a consultant to insurance carriers and attorneys, Anthony customizes services based on the particular needs of the client and oversees all activities related to business development and company operations. For more information about ANS Solutions visit


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Medical Marijuana Vs. Big Pharma

Medical Marijuana Vs. Big Pharma

Increasingly gaining ground as an accepted medicine by top health associations, researchers, and medical journals, the marijuana industry continues its massive expansion, with legalization encompassing more than half the U.S. Predicted to expand nationwide by 2021 by investment firm The Motley Fool, other sectors of the economy are feeling the strain of the industry’s new growth – but no one greater than Big Pharma.

Marijuana & Pharmaceutical Market Share
In an effort to determine how cannabis cash flow is effecting the pharmaceutical industry, researchers at the University of Georgia uncovered just how much of the pharmaceutical pie is being gobbled-up in medical marijuana states – and the results were stark: The average doctor in cannabis-friendly states prescribed 265 fewer dosages of antidepressants, 486 less anti-seizure meds, 541 fewer anti-nausea doses, 562 less anti-anxiety meds, and a whopping 1,826 less doses of pain medications, saving the government’s Medicare Part-D program an estimated $165 million on prescription pills. Taking that total nationwide, an estimated $470 million would disappear from Big Pharma’s annual revenue from this avenue alone.

Expanding Data on Marijuana & Opioids Worrisome for Pharma
A 2014 JAMA study stated opiate overdoses dropped roughly 25% in states with legalized medical marijuana, implying patients may be using it for pain treatment – or to lessen their painkiller load. According to according to the report in Drug and Alcohol Dependence, legalization states also failed to see the expected influx of pot smokers through hospital doors – instead experiencing a decline in hospitalization rates for opioid abuse and overdoses, which dropped 23% and 13% respectively, on average.

Fighting Legalization While Simultaneously Developing Synthetic Cannabis Drugs
This big dip in pharmaceutical purchases is hitting Big Pharma hard, and combined with industry interests, is fueling massive donations to anti-marijuana campaigns, making Purdue Pharma (OxyContin) and Abbot Laboratories (Vicodin) some of the largest contributors to the Anti-Drug Coalition of America. Now infamous, Insys Therapeutics, Inc. (Fentanyl), who currently faces multiple federal and state investigations for aggressive sales and marketing practices, donated $500,000 to Arizonans for Responsible Drug Policy, helping eke out a narrow 51-49 block of Arizona’s 2016 legalization attempt, and making it the only state in which legalization failed in 2016 voting. One of the largest individual contributions to any anti-legalization campaign in history, just five months later Insys won approval for a cannabis-derived pharmaceutical – an anti-nausea drug for AIDS patients – causing cannabis market leaders to reflect on the ethics of Big Pharma’s positioning, and why it has been favored by the DEA and FDA over plants that have already proven effective, safer, and cheaper than prescription drugs.

Stacking the Deck
Few have the resources necessary for this level of lobbying, or to manage the massive fees and extensive oversight necessary to work with the DEA and FDA for testing marijuana usage and product development – but Big Pharma does. It has achieved approval for other drugs in the past, including synthetic THC med Marinol for cancer and AIDS patients. Two cannabis-infused chewing gums by AXIM Biotech now currently await approval for IBS and MS treatment, as well as a topical for eczema/psoriasis. Kannalife Sciences is also developing new drugs for degenerative brain conditions (hepatic/chronic traumatic encephalopathy). Once approved, the drugs are classified separately from Schedule I whole plant marijuana products, their kissing cannabis cousins, and 100% legal with a script.

Are You Ready for a Changing of the Tides?
The workers compensation world is sure to experience turmoil over the upcoming years as changing legislation and front runners in the marketplace scramble for their share of the pie.

anthonyAbout the Author:  Anthony Sambucini is a founding principal and the Chief Executive Officer of ANS Solutions. Anthony specializes in bridging the goals of clinical innovation and business strategy that have helped propel ANS Solutions into a national leader in Pharmacotherapy Review Services for workers’ comp insurers. As a consultant to insurance carriers and attorneys, Anthony customizes services based on the particular needs of the client and oversees all activities related to business development and company operations. For more information visit .

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The Impact of Workers Compensation Compounding

As custom-made compound prescriptions concoctions continue to rack-up higher workers’ compensation costs, insurers are scrambling to find alternatives and employers are looking for relief from equally inflated premiums. With little to no evidence as to the efficacy of such creations, many states have implemented treatment guidelines directing doctors to more evidentiary-based, easily reimbursable options. Despite guidelines and formularies however, loopholes in coverage continue to allow providers to sell millions of dollars of compounds, with many companies submitting inflated reimbursement bills in their attempts to get paid.

A Growing Issue in Workers Compensation

This June, the U.S. Attorney’s Office brought criminal charges against such providers across the country, accusing them of defrauding the Medicare, Medicaid, and Tricare health insurance programs that serve the military and their families. Additionally, the Inspector General of the U.S. Postal Service identified compound drugs as attributable for 34% of the postal service’s prescriptions, and 53% of prescription drug costs in 2015, a rise from 22% and 27% in 2014, respectively. State and federal prosecutors also continue to finger some pharmacies for offering doctor kickbacks in exchange for prescriptions.

Money or medicine?

Industry guidelines point to the use of such compounds as a last resort, accepted in instances where a person is allergic to an ingredient in a drug, or when a liquid version of a commercially available drug is necessary for one who cannot swallow capsules. Some doctors prescribe initially despite these guidelines. The unnecessary prescription of compounds is costing the workers’ comp industry billions annually.

Deep impact

2015 calculations indicate…

  • Re-packaged drugs dispensed by physicians cost employers 60% to 300% more than those dispensed at retail pharmacies.
  • The average paid per compound drug increased by more than two-thirds from $460.00 to $774.00, though non-compound drugs fell slightly from $113.00 to $108.00.
  • The U.S. Postal Service alone spent a whopping $390,000.00 a day for compound drugs in 2015.

Tired of paying more for ineffective treatments?
Proven, more affordable, clinically tested and approved options to compounds do exist. It’s time to find a better way. Discover how to achieve better claims outcomes with ANS Solutions Pharmacotherapy Review. Contact today.

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Is Regulation the Answer to Rising Pharma Costs?

National pressure has been building for government regulation on pharmaceutical costs.  A recent poll from the Kaiser Family Foundation found that 72% of Americans think drug costs are unreasonable and demand more transparency from drug companies, especially when it comes to how they set prices.(1) In the face of this discourse, the accountability of pharmaceutical companies has grown as a key focus of recent state and federal regulations.

In the state of Vermont, expensive prescriptions drugs distributed by manufacturers must now justify their exorbitant costs, according to a newly introduced state bill. This new approach, dubbed ‘transparency bills’ stipulates that the information provided by drug makers will be made public, and if they fail to submit, fining will result. It further requires that health insurers provide information to enrollees, potential enrollees, and providers regarding the exchange plans’ drug formularies, including covered drugs, cost-sharing prices, drug tiers, prior authorization, step therapy and utilization management requirements, whose facets are rarely known and understood. Similar measures have also been introduced in other states including California, New York, North Carolina, Oregon, Pennsylvania, Texas, and Virginia.

A debate has been brewing around whether regulation is truly the best solution for pharmaceutical cost containment. Opposing views are camped around the significance of immediate verse long-term effects. Those in opposition raise concerns that such regulation will only produce modest consumer savings while the reduction in pharmaceutical revenues will slow the pace of innovation thus reducing life expectancy and the release of new drugs for future generations. Proponents believe that the benefit of lower prices experienced by consumers now far outweighs these concerns. Influenced by this growing debate, researchers at RAND Corporation examined the impact of drug price regulation in the US. Key findings include(2):

  • The regulation of pharmaceutical prices has increased in recent years on a global scale
  • Regulation has been seen to reduce pharmaceutical revenues.
  • Alternative approaches that reduce consumer costs without affecting pharmaceutical revenues are more likely to benefit current and future generations of consumers.

Ans Solutions specializes in pharmaceutical cost containment that optimizes outcomes for the injured worker while also minimizing financial impact for payers.


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2016 WCRI Annual Issues & Research Conference

ANS recently attended the 2016 WCRI Annual Issues & Research Conference. The independent, not-for-profit institute studies and delivers objective information pertaining to public policy issues involving the workers’ comp system.

Conference Panel Highlights:

  • Opioid Prescribing in Workers’ Comp
    • Overview:
      Opioids are a societal problem – not just a workers’ comp issue, and it will take a decade to dig ourselves out. Guidelines are necessary to combat the growing trend.
    • Positive Trends:
      Prescription frequency varies widely by state, leading to revised prescribing guidelines in medical/workers’ comp communities. Retail pharmacies are no longer simply filling, but verifying diagnosis/necessity. The DEA/FDA are also reclassifying some medications to reflect abuse potential, and activist groups supporting change are emerging.
    • Negative Trends:
      A major problem in the workers’ comp arena, the need for early intervention/monitoring is being overlooked by employers, and subsequently programs. Conflicting guidelines also cause confusion. Additionally, use of heroin, the cheaper alternative to prescription opioids, is on the rise.
    • Goals:
      Curtail chronic opioid use and ensure appropriate prescribing of opioids to injured workers and avoid unintended results by boosting awareness of the issue.
  • Opioid Dispensing and Use
    • Overview:
      Yet-to-be published studies reveal the impact of pricing reforms for opioid dispensing physicians.
    • Physician Dispensing:
      Following reforms, prices decreased in most states, with fewer prescriptions dispensed. In IL and FL prices substantially increased – because physicians switched to formulations not covered in fee schedules. Price/amounts of pharmacy-dispensed products remained constant.
    • Variations in Use:
      Three-of-four injured workers nationwide receive opioids for pain. LA, NY, and PA dispense significantly higher amounts; NY and PA higher dosages. Patients who received opioids also received benzodiazepines in WI, MI, CT and MA. Per claim amounts decreased from 2012-2014, and frequency of drug testing increased significantly.

As an industry leader in large loss workers compensation claim management, ANS is setting the pace for drug utilization review with our proprietary Pharmacotherapy Review, helping fight the trend of the over-prescription of narcotics. Contact today.


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Abuse Deterrent Opioids a New Era of Opioid Drug Development

The prevalence of opioid use and abuse has led to a new era of opioid drug development: Abuse deterrent (AD) opioids.

The goal?….

Maintain the efficacy of opioid formulations while improving their ability to deter abuse. Following guidelines developed by the FDA to categorize new opioid formulations, pharmaceutical companies are now on a quest to develop tomorrow’s safety net against opioid abuse.

How will the FDA be categorizing these new AD opioid formulations?

  1. Physical/chemical barriers
    Physical barriers that prevent the crushing, cutting, grating, grinding, or chewing of opioid formulations, alone or in combination with chemical barriers, which can resist extraction with common solvents (water, alcohol, organic solvents).
  2. Agonist/antagonist combinations
    Formulations with the addition of an opioid antagonist, released only when opioid drugs are manipulated. When triggered, the agonists “interfere with, reduce, or defeat” opioid induced euphoria commonly associated with abuse.
  3. Aversion
    The addition of a noxious component to formulations to produce an unpleasant effect when opioids are manipulated, or when a higher dose than prescribed is consumed. (For example, a nasal irritant to deter snorting.)
  4. Prodrug
    Biologically inactive substances metabolized inside the body to their active form: That is, the drug must be taken by its intended route and form in order to be properly metabolized.
  5. Delivery system
    The implementation of more difficult to manipulate drug delivery systems, such as subcutaneous implants, depot injectable formulations, beads within a capsule, and erodible matrix technology.
  6. Combination of 2 or more of the above
    Combining 2 or more of the above methods to decrease the likelihood of abuse.

More questions than answers

Though AD technology is advancing, it continues to carry with it an onslaught of unmet expectations/unanswered questions…

  • Is making an uncrushable pill really going to curb opioid abuse when it can be consumed in other ways?
  • Why aren’t efforts being made to explore more economically responsible, alternative therapies that don’t involve any form of opioids at all?
  • Will this approach yield enough penetration in the chronic pain treatment community to persuade physicians and patients to switch from their current prescriptions to abuse deterrent forms?

Helping curb the opioid epidemic

Only time will tell how the development of AD opioids will progress and effect the growing opioid abuse epidemic. Fortunately, you don’t have to await developing AD technology to take steps towards making a positive change. Readily available programs, including ANS expert nurse consulting and pharmacotherapy review can help you better address the need of pain patients, providing better outcomes, faster recovery times, and less risk than common opioid treatment regimens.

Ready to be part of the change? Contact ANS today and learn more about how ANS Pharmacotherapy Review can provide superior results for injured workers. Visit us at for more information.


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The Perils of Polypharmacy

In the context of large loss workers compensation claims and the treatment of pain in injured workers, polypharmacy is typically associated with the use of four or more medications. As a result, polypharmacy creates an environment where several complications can occur. Here we delve into some critical issues affecting the injured worker as a result of polypharmacy: compliance, drug interaction and risk of addiction.

Dosage Compliance & Drug Interactions

To put it simply, compliance is taking medications the way they are intended to be taken. The lack of compliance with a prescribed treatment regimen is most often unintentional. A patient may inadvertently take the wrong dosage, miss a dosage entirely or mix dangerous combinations of drugs. Further, even though the right dosages may be administered, drug interaction poses yet another harmful risk for the injured worker. Treating physicians may not be communicating with each other and therefore are unaware of existing medications or treatment regimens which may affect quality of care. For example, MAO inhibitors and blood thinners can actually counteract or reduce another medication’s effectiveness.

Possible Addiction & Overdose

Addiction and overdose are both related to treatment and dosage compliance. An unfortunate lack in monitoring a patient’s treatment program and progress may result in missed warning signs and missed opportunities to modify a treatment program based on patient’s recovery. Quite often addiction is not self-imposed but rather, factors such as duplicate therapies, inappropriate treatments and excessive dosages of opioids set the stage. Pain treatment through highly addictive opioids, coupled with a lack of patient education on the risks and dangers of these drugs, subjects injured workers to a path of drug addiction which may hinder or prevent recovery.

How Can ANS Solutions Pharmacotherapy Review Help?

Our Pharmacotherapy review program can help uncover possible risks that could have a dramatic impact on the person’s health. Typically, Pharmacotherapy Review uncovers major issues including duplicate therapies, dangerous or deadly drug interactions, or behaviors related to drug addiction. All of which may contribute to a longer recovery time, no recovery or even death for an injured worker. By bringing these issues to light and recommending a more appropriate course of action our program can enhance the quality of life for the injured worker while also increasing financial cost for Payers.

To find out more about our Pharmacotherapy Review Program visit the website today at


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