Suntree Pharm. v. Drug Enf't Admin., 20-14626

CourtUnited States Courts of Appeals. United States Court of Appeals (11th Circuit)
Writing for the CourtPer Curiam:
Docket Number20-14626
Decision Date14 February 2022



No. 20-14626

United States Court of Appeals, Eleventh Circuit

February 14, 2022


Petition for Review of a Decision of the Drug Enforcement Administration Administration No. 17-09 / 17-10


Before Newsom, Luck, and Anderson, Circuit Judges.

Per Curiam:

Suntree Pharmacy and Suntree Medical Equipment, LLC petition for review of the Acting Administrator of the Drug Enforcement Administration's decision to revoke their registrations to dispense controlled substances and to deny their pending renewal applications. See Suntree Pharmacy & Suntree Med. Equip., LLC, 85 Fed.Reg. 73753 (Nov. 19, 2020). The Acting Administrator revoked and denied Suntree Pharmacy's and Suntree Medical's registrations and pending renewal applications after an administrative hearing revealed that Suntree Pharmacy had filled prescriptions for controlled substances outside of the usual course of practice and in violation of federal and state law.[1] Suntree argues that the Acting Administrator's revocation of its registrations was arbitrary and capricious and that the length of the administrative proceedings violated its procedural due process rights. We deny the petition for review.



The Contro led Substances Act

We briefly summarize the relevant statutory framework before turning to the facts of this case. The Controlled Substances Act "creates 'a closed regulatory system making it unlawful to manufacture, distribute, dispense, or possess any controlled substance except in a manner authorized by the [Act].'" Jones Total Health Care Pharmacy, LLC v. Drug Enf't Admin., 881 F.3d 823, 827 (11th Cir. 2018) (quoting Gonzales v. Raich, 545 U.S. 1, 13 (2005)). The Act requires pharmacies that dispense prescriptions for controlled substances to obtain proper registration from the Attorney General. Id.

The Act places "the responsibility for the proper prescribing and dispensing of controlled substances, which must be for 'a legitimate medical purpose,' . . . on the prescribing practitioner, 'but a corresponding responsibility rests with the pharmacist who fills the prescription.'" Id. (quoting 21 C.F.R. § 1306.04(a)). Pharmacists therefore "have a 'corresponding responsibility' to refuse to fill prescriptions that are not issued for a legitimate medical purpose." Id.; see United States v. Hayes, 595 F.2d 258, 261 (5th Cir. 1979) ("The pharmacist is not required to have a 'corresponding responsibility' to practice medicine. What is required of him is the responsibility not to fill an order that purports to be a prescription but is not a prescription within the meaning of the statute because he knows that the issuing practitioner issued it outside the scope of medical practice.").


The Attorney General has delegated his authority to deny, revoke, or suspend pharmacy registrations to the Drug Enforcement Administration. Jones, 881 F.3d at 827. The Administration may revoke an existing registration or deny an application for registration if the registration is or would be "inconsistent with the public interest." Id. at 829 (quoting 21 U.S.C. §§ 824(a)(4), 823(f)). When the Administration proposes to revoke an existing registration, it must serve an "order to show cause" on the registrant and provide the registrant an opportunity for a hearing before an administrative law judge in order to contest the proposed action. Id. at 827 (citing 21 U.S.C. § 824(c)). After the administrative law judge certifies the record to the Administrator, he or she must publish a final order with findings of fact and conclusions of law. See 21 C.F.R. §§ 1316.65, .67. The final order must be published "[a]s soon as practicable after the [administrative law judge] has certified the record to the Administrator." Id. § 1316.67.

Suntree and the Order to Show Cause

Suntree Pharmacy and Suntree Medical were registered retail pharmacies in Florida. On October 5, 2016, the Administration issued an order to show cause why Suntree's registrations shouldn't be rescinded and its pending renewal applications shouldn't be denied because Suntree's "continued registrations are inconsistent with the public interest." The Administration alleged that, from October 2013 to March 2015, Suntree filled more than two hundred controlled substances prescriptions "outside the usual course of pharmacy practice" and "in contravention of [its]


'corresponding responsibility.'" Specifically, the order to show cause alleged that Suntree violated its corresponding responsibility by: (1) filling prescriptions for patients without resolving red flags that the prescriptions were not for a legitimate medical purpose; (2) filling prescriptions for a doctor that he wrote for himself in violation of state law; and (3) filling prescriptions for "office use" in violation of federal law.

As to the prescriptions for patients, the order to show cause alleged that Suntree "repeatedly filled controlled substances prescriptions that contained multiple red flags of diversion and/or abuse without addressing or resolving those red flags, and under circumstances indicating that [Suntree was] willfully blind or deliberately ignorant of the prescriptions' legitimacy." As to the prescriptions written by the doctor for himself, the order to show cause alleged that the prescriptions "were written in violation of Florida law . . . which prohibits a physician from 'prescribing, dispensing, or administering any' drug in Schedule II-VI 'by the physician to himself.'" And as to the prescriptions for "office use," the order to show cause alleged that Suntree "dispensed testosterone on at least fourteen different occasions pursuant to invalid prescriptions which indicated the ultimate user was an 'office,' in violation of 21 C.F.R. [section] 1306.04(b)."

The Administrative Law Judge's Decision

An administrative law judge held a hearing on the order to show cause in April 2017. At the hearing, the Administration presented the testimony of its expert witness, Dr. Tracey Gordon,


Pharm.D., its diversion investigator, James Graumlich, an employee of Suntree Medical, Michael Peterson, and the owner of Suntree, Dr. Diahn Clark, Pharm.D. Suntree presented the testimony of its expert witness, Dr. Wayne Grant, Pharm.D., Suntree Pharmacy's regulatory attorney, Darren Meacham, and Dr. Clark.

On August 15, 2017, the administrative law judge issued his findings of fact and conclusions of law, recommending that the Acting Administrator revoke Suntree's registrations and deny its pending renewal applications. The administrative law judge credited Dr. Gordon's testimony that Suntree filled multiple prescriptions for controlled substances to twenty-two patients that had one or more "red flags"-indicia that the prescriptions were not issued for a legitimate medical purpose-and should not have been filled without first investigating and resolving the red flags.

Dr. Gordon testified that the usual course of professional practice in Florida required a pharmacist to investigate and resolve red flags before dispensing a controlled substance. Dr. Gordon identified more than a dozen red flags that Suntree ignored in filling prescriptions, including: (1) patients traveling long distances- some as far as 170 miles-to obtain prescriptions; (2) "groups" of patients traveling to the same physicians on the same days to obtain similar prescriptions which Suntree frequently filled at the same time; (3) patients making cash payments; (4) patients obtaining prescriptions for well-known, highly diverted and abused controlled substances; (5) patients obtaining prescriptions for the highest dosages; (6) patients obtaining repeated prescriptions for highly


abused drug "cocktails"; (7) patients obtaining early refills of prescriptions; (8) patients obtaining prescriptions for two immediate release opioids that do the same thing; and (9) physicians prescribing outside the scope of their usual practice.

The administrative law judge credited Dr. Gordon's testimony and found that "[w]hen a red flag is resolved, it must be documented before the prescription is dispensed" and that "[i]f a red flag cannot be resolved, under the standard practice [of] a pharmacy in Florida, the medication should not be dispensed." The administrative law judge also credited Dr. Gordon's testimony and found that "nothing in the record resolves the red flags raised by prescriptions dispensed" by Suntree. The administrative law judge found that the "blatant" unresolved red flags were "sufficient circumstantial evidence" to establish that the prescriptions were not written for a legitimate medical purpose. And the administrative law judge reasoned that, "while nothing in the [Administration's] regulations specifically requires a pharmacist to document the resolution of a red flag, Florida laws specifically require that a pharmacist maintain records that include discussions with licensed health care practitioners and information about a patient's drug therapy and information peculiar to a specific patient," and that, "[i]n light of these requirements, the absence of such documentation is...

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