UNNATURAL CAUSES SICK AND DYING IN SMALL-TOWN AMERICA: Since the turn of this century, rates have risen for whites in midlife, particularly women. In this series, The Washington Post is exploring this trend and the forces driving it. Related: Wholesalers sent pills to drugstores that fueled the opioid epidemic
A decade ago, the Drug Enforcement Administration launched an aggressive campaign to curb a rising opioid epidemic that was claiming thousands of American lives each year. The DEA began to target wholesale companies that distributed hundreds of millions of highly addictive pills to the corrupt pharmacies and pill mills that illegally sold the drugs for street use.
Leading the campaign was the agency’s Office of Diversion Control, whose investigators around the country began filing civil cases against the distributors, issuing orders to immediately suspend the flow of drugs and generating large fines.
But the industry fought back. Former DEA and Justice Department officials hired by drug companies began pressing for a softer approach. In early 2012, the deputy attorney general summoned the DEA’s diversion chief to an unusual meeting over a case against two major drug companies.
“That meeting was to chastise me for going after industry, and that’s all that meeting was about,” recalled Joseph T. Rannazzisi, who ran the diversion office for a decade before he was removed from his position and retired in 2015.
Rannazzisi vowed after that meeting to continue the campaign. But soon officials at DEA headquarters began delaying and blocking enforcement actions, and the number of cases plummeted, according to on-the-record interviews with five former agency supervisors and internal records obtained by The Washington Post.
The judge who reviews the DEA diversion office’s civil caseload noted the plunge.
“There can be little doubt that the level of administrative Diversion enforcement remains stunningly low for a national program,” Chief Administrative Law Judge John J. Mulrooney II wrote in a June 2014 quarterly report obtained under the Freedom of Information Act.
In fiscal 2011, civil case filings against distributors, manufacturers, pharmacies and doctors reached 131 before dropping to 40 in fiscal 2014, according to the Justice Department. The number of immediate suspension orders, the DEA’s strongest weapon of enforcement, dropped from 65 to nine during the same period.
“Things came to a grinding halt,” said Frank Younker, a DEA supervisor in the Cincinnati field office who retired in 2014 after 30 years with the agency. “I talked to my fellow supervisors, and we were all frustrated. It was ridiculous. I don’t know how many lives could have been saved if the process was done quicker.”
The slowdown began in 2013 after DEA lawyers started requiring a higher standard of proof before cases could move forward.
Top officials at the DEA and Justice declined to discuss the reasons behind the slowdown in the approval of enforcement cases. The DEA turned down requests by The Post to interview Mulrooney, acting DEA administrator Chuck Rosenberg, chief counsel Wendy H. Goggin and Rannazzisi’s replacement, Louis J. Milione.
The agency provided a statement from Rosenberg:
“We combat the opioid crisis in many ways: criminally, civilly, administratively, and through robust demand reduction efforts.
“We implemented new case intake and training procedures for our administrative cases, increased the number of enforcement teams focused on criminal and civil investigations, restarted a successful drug take back program, and improved outreach to — and education efforts with — our registrant community.
“We have legacy stuff we need to fix, but we now have good folks in place and are moving in the right direction.”
The Justice Department, which oversees the DEA, declined requests to interview Attorney General Loretta E. Lynch and Deputy Attorney General Sally Q. Yates.
The department issued a statement saying that the drop in diversion cases reflects a shift from crackdowns on “ubiquitous pill mills” toward a “small group” of doctors, pharmacists and companies that continues to violate the law.
Drugs are manufactured by high-profile corporations such as Purdue Pharma. They rely on a lesser-known network of distributors, some of which are also multinational corporations. The distributors serve as middlemen, sending billions of doses of opioid pain pills to pharmacists, hospitals, nursing homes and pain clinics. The U.S. prescription opioid market generates $10 billion in annual sales.
There are thousands of distributors among the 1.6 million people and companies that hold DEA licenses to dispense drugs, but three of them — McKesson, AmerisourceBergen and Cardinal Health — account for 85 percent of the drug shipments in the United States. These companies, which together collect about $400 billion in annual revenue, supply the corner pharmacist as well as giant medical centers.
For years, the DEA had taken a hands-off approach to the prescription drugs flowing out of the distributors. The companies had been reporting their drug sales inconsistently or not at all. They had been largely left alone as the DEA focused on doctors and pharmacies.
“The distributors had been ignored for years and years and years,” John J. Coleman, the third-ranking administrator at the DEA in the mid-1990s, said in a recent interview.
In 2005, the Office of Diversion Control, under Rannazzisi, launched its “Distributor Initiative” and briefed 76 companies about it. The new campaign pitted the DEA against an industry with close ties to lobbyists, lawyers and politicians in Washington.
On Sept. 27, 2006, the diversion office sent a letter to distributors across the country, reminding them that they were required by law to ensure that their drugs were not being diverted to the black market.
“Given the extent of prescription drug abuse in the United States, along with the dangerous and potentially lethal consequences of such abuse, even just one distributor that uses its DEA registration to facilitate diversion can cause enormous harm,” Rannazzisi wrote in the letter.
Five months later, D. Linden Barber, then-associate chief counsel for the DEA diversion office, wrote to DEA supervisors across the country, telling them to be vigilant. Abuse of prescription drugs, he said, had become “greater than the abuse of cocaine, heroin and methamphetamine.”
Under Rannazzisi’s initiative, distributors would have to monitor their sales in real time, withhold drug shipments if they detected suspicious activity and report those red flags to the DEA.
The diversion office deployed two weapons to ensure compliance. The first was an “order to show cause,” which permits investigators to begin a process to stop drug shipments from warehouses. The second was an “immediate suspension order,” which allows the DEA to instantly freeze shipments of narcotics from facilities where an “imminent threat” to public health exists. The immediate suspension order was especially dreaded by the distributors.
Younker, the former DEA supervisor in Cincinnati, said the agency had no other choice.
“The distributors could have stopped what was going on, but they didn’t,” he said. “They were doing the bare minimum. Why would you want to cut off a customer that’s paying you $2 million a year? They have sales reps and sales quotas and bonus structures and employees of the month. Everyone was making a lot of money.”
In late 2011, Rannazzisi’s office filed warrants to yet again inspect the records of a Cardinal warehouse. Investigators alleged that the company was overlooking escalating oxycodone orders from pharmacies in Florida. The DEA was also targeting four drugstores supplied by Cardinal in the state, including two CVS pharmacies.
Rannazzisi’s office obtained an internal Cardinal email from 2010 showing that the company’s own investigator had warned against selling narcotics to Gulf Coast Medical Pharmacy, an independent drugstore in Fort Myers, Fla., citing suspicions that the pills were winding up on the street.
Despite the warning, Cardinal hadn’t notified the DEA or cut off the supply of drugs.
Instead, the company shipped increasing quantities of pain pills to Gulf Coast. In 2011 alone, Cardinal sent more than 2 million doses of oxycodone to Gulf Coast. The wholesaler typically shipped 65,000 doses annually to comparable pharmacies.
That summer, lobbying by the pharmaceutical industry intensified on Capitol Hill. Several members of Congress, led by Reps. Tom Marino (R-Pa.) and Marsha Blackburn (R-Tenn.), were proposing a measure that critics said would undercut the DEA’s ability to hold drug distributors accountable.
Four major players lobbied heavily in favor of the legislation, called the Ensuring Patient Access and Effective Drug Enforcement Act. Together, McKesson, AmerisourceBergen, Cardinal and the distributors’ association, the Healthcare Distribution Alliance, spent $13 million lobbying House and Senate members and their staffs on the legislation and other issues between 2014 and 2016, according a Post analysis of lobbying records.
In July 2014, Rannazzisi was asked to explain his opposition to the bill in a conference call with congressional staffers.
“I said, ‘This bill passes the way it’s written we won’t be able to get immediate suspension orders, we won’t be able to stop the hemorrhaging of these drugs out of these bad pharmacies and these bad corporations,’ ” Rannazzisi recalled telling them. “ ‘What you’re doing is filing a bill that will protect defendants in our cases.’ ”
His remarks enraged Marino, the chairman of the House Judiciary subcommittee on regulatory reform.
In a Sept. 18, 2014, congressional hearing, Marino tore into then-DEA Administrator Michele Leonhart, Rannazzisi’s boss. By then, the legislation had passed the House; the bill was about to be introduced in the Senate.
“It is my understanding that Joe Rannazzisi, a senior DEA official, has publicly accused we sponsors of the bill of, quote, ‘supporting criminals,’ unquote,” Marino said. “This offends me immensely.”