Under the terms of a consent decree negotiated with the Department of Justice (DOJ), a Puerto-Rico based pharmaceutical distributor agreed to pay $12 million to resolve allegations that it failed to report hundreds of suspicious orders for controlled substances to the DEA (United States v. Droguería Betances, L.L.C., No. 3:23-cv-01538 (D.P.R.)).

In a complaint filed in October 2023 in the U.S. District Court for the District of Puerto Rico, the DOJ alleged that Droguería Betances L.L.C., which distributes pharmaceuticals to Puerto Rico and other areas of the Caribbean, failed to report orders for opioids and other controlled substances provided to the company’s pharmacy clients.

The government alleged that the unreported suspicious orders included at least 655 suspicious orders for fentanyl and at least 113 suspicious orders for oxycodone.

Also, between May 2017 and July 2018, the distributor allegedly failed to submit required reports of its distribution transactions to the DEA through the agency’s Automation of Reports and Consolidated Orders System (ARCOS). Among the transactions that Droguería Betances allegedly failed to report during the 15-month period were all of its distributions of Schedule II opioids.

In addition, the distributor allegedly committed hundreds of violations of the DEA’s recordkeeping requirements, including filling controlled substance orders using defective order forms and submitting inaccurate shipping and delivery information to the agency.

Terms of Consent Decree

Under the terms of the 27-page consent decree, Droguería Betances committed to enhance its compliance program in part by implementing improved controlled substance monitoring program procedures and systems to make sure that all controlled substance orders are reviewed and that all suspicious orders are detected and reported to the DEA.

Among the specific red flags of potential illicit dispensing by its pharmacy customers that Droguería Betances committed to detecting were the following:

• A high percentage of the customer’s controlled substance sales are paid in cash.
• The customer fills prescriptions for many patients who travel far distances to obtain prescriptions from providers or pharmacies.
• The customer frequently fills prescriptions for quantities of controlled substances that are higher than the accepted medical standards.
• A high percentage of the customer’s overall dispensing consists of controlled substances.
• A disproportionate percentage of the customer’s controlled substance sales are for highly diverted substances.
• The customer fills prescriptions written by prescribers acting outside their practice or specialty.
• The customer fills prescriptions for prescribers who have been subject to discipline or a law enforcement action.
• The customer dispenses the same quantity of highly diverted controlled substances to most patients.

The distributor also committed to monitoring for additional red flags identified by the DEA or by local pharmacy regulators.

Moreover, the company agreed to improve its procedures and systems for conducting due diligence of its pharmacy customers.

Also, the distributor must submit annual reports about its compliance program and its customers to the DEA Caribbean Division and to the DOJ’s Consumer Protection Branch, and it must improve its ARCOS reporting system “to ensure proper and accurate reporting of all acquisitions and distributions of Schedule II controlled substances,” the government said.

Through a financial analysis conducted by the DOJ of the company’s assets in relation to its potential exposure to civil fines and forfeiture, the government determined that, based on the firm’s ability to pay, the consent decree would require Droguería Betances to pay the $12 million through annual payments over five years.

Of the $12 million, $10.2 million was designated as civil penalties, and $1.8 million was designated that the civil forfeiture.

The case was investigated by the San Juan Division Office of the Caribbean Division of the DEA’s Diversion Control Division.

Company Statement

In a Nov. 6, 2023, statement announcing the settlement, Droguería Betances said that it had rejected the DOJ’s allegations that it did not have an efficient system in place to monitor suspicious orders, but that it had nevertheless agreed to strengthen its system for reporting the company’s distributions of controlled substances.

The company also stressed that it was not involved in the promotion or marketing of opioids or other controlled substances, and that opioids made up “a slight portion” of the products that it distributed.

“Over the past few years,” said Juan Carlos Hernández, the company’s president, “we have invested millions of dollars in technology and external consulting to ensure strict compliance with the laws and regulations that apply to controlled substances.” He also insisted that the distributor “complies with all federal and state regulations.”

“The federal complaint was exclusively aimed at areas of regulatory compliance,” Hernández added. “Droguería Betances was never the subject of allegations related to the diversion of controlled substances to unauthorized persons or entities.”