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August 15, 2014  
Contact: Public Information Officer
Number: (313) 234-4310

Two Kentucky Pharmacies and Three Narcotic Treatment Programs Settle with U.S. Government -Agree to Pay $1 Million to Settle Allegations of Improper Record Keeping of Controlled Substances
Pharmacies and treatment programs relinquish DEA registration and lose authority to dispense controlled substances

AUG 15 (PIKEVILLE, Ky.) – Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky, and James V. Allen, Acting Special Agent in Charge of the U.S. Drug Enforcement Administration (DEA), jointly announced today that the federal government has reached settlements, worth more than $1 million, with multiple Eastern Kentucky narcotic treatment programs and two pharmacies, to settle allegations that they failed to maintain accurate records of the controlled substances under their control. 

“The regulatory scheme governing the handling of controlled substances is designed to insure that these powerful drugs are used only for appropriate medical purposes,” said U.S. Attorney Harvey. “These vital safeguards are compromised and our communities are put at greater risk when medical professionals entrusted to prescribe or dispense these drugs do not meet their obligations under the Controlled Substances Act.  The substantial penalties paid in these cases are consistent with the importance of strict compliance with the Controlled Substances Act by all DEA registrants.”

The Perry County Treatment Center, LLC; Pike County Treatment Center, LLC; and Paintsville Professional Associates, LLC, and one of its doctors, agreed to pay a total of $525,000 to settle claims that they violated the Controlled Substance Act. This is believed to be the largest penalty ever obtained by the U.S. Attorney’s Office in the Eastern District of Kentucky, in a civil case involving methadone treatment programs.  Additionally, MedZone Pharmacy and Neighborhood Pharmacy, both in Prestonsburg, Ky., each agreed to pay $250,000 for similar violations. The facilities involved in the settlements surrendered their DEA registration number and will no longer have the authority to possess or dispense controlled substances.

The government contended that a DEA audit of the treatment programs and pharmacies revealed shortages and overages of prescription drugs and incomplete and inaccurate records. DEA agents found the facilities had improperly documented the type of drug, the dosage strength, the name of drugs, or the amount of the drugs they were dispensing. The investigations were initiated and conducted by the DEA’s office in London, Kentucky.

Under federal law, the DEA supplies medical professionals with a registration number that authorizes them to possess, prescribe and dispense certain controlled substances, such as Methadone, Oxycodone, Hydrocodone, Lortab and others. The DEA also has the authority to perform audits and inspections to ensure that clinics, pharmacies and treatment programs properly document drug transactions, including the amount of controlled substances dispensed, discarded, and received.

Assistant U.S. Attorney Andrew Sparks handled this case on behalf of the federal government.


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