Shreveport Wholesale Drug Distribution Company Settles with Department of Justice for Failure to Report Suspicious Opioid Orders to DEA

NEW ORLEANS, LOUISIANA – MORRIS & DICKSON (“M&D”), a Shreveport-based pharmaceutical distribution company has agreed to a $13.75 million settlement with the U.S. Attorney’s Office for the Eastern District of Louisiana.   

According to the Non-Prosecution Agreement, beginning in January of 2012 and continuing until May of 2018, MORRIS & DICKSON, through its employees and agents, failed to conduct adequate order-level monitoring, and failed to file suspicious order reports with the Drug Enforcement Agency (“DEA”), as required by DEA Regulations.  In fact, M&D filed just three suspicious order reports with DEA during the relevant time period.  This was the case despite M&D’s employees’ and agents’ awareness not only of the high likelihood that some of M&D’s customers were diverting controlled substances, but also of other circumstances that should have resulted in filing suspicious order reports with DEA.

Former M&D customer Wilkinson Family Pharmacy (“Wilkinson”), an independent retail pharmacy in Chalmette, Louisiana, illegally dispensed quantities of controlled substances outside the scope of professional practice and not for a legitimate purpose.  Wilkinson filled many opioid related prescriptions, often written by “pill mill” doctors or forged by medical staff and their associates at “pill mill” clinics.  Specifically, Wilkinson filled approximately twenty times more opioid prescriptions than either the national or Louisiana average for pharmacy filled opioid prescriptions.  M&D was notified that Wilkinson was filling prescriptions for controlled substances far exceeding the national and state average.  Although, M&D counseled Wilkinson about its questionable ordering practices, M&D never reported Wilkinson or its arguably suspicious orders to DEA.

Additional conditions of the settlement require M&D to enhance its compliance program and internal controls.  Finally, DOJ acknowledges the substantial enhancements M&D has made to its compliance program.

This prosecution was part of an investigation by the Organized Crime Drug Enforcement Task Force (OCDETF).  OCDETF is a joint federal, state, and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional level drug trafficking organizations and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets. 

The investigation was handled by Assistant United States Attorneys Kathryn McHugh of the Financial Crimes Unit, Nicholas Moses, Health Care Fraud Coordinator, and Narcotics Unit Supervisor, Nolan Paige.