Costco to pay $11.75 million to resolve allegations of violating Controlled Substance Act

By Mark Iandolo | Jan 27, 2017

WASHINGTON (Legal Newsline) — The Department of Justice announced Jan. 19 that Costco Wholesale will pay $11.75 million after allegations its pharmacies violated the Controlled Substance Act.


“Pharmacies across this country are on the leading edge of the battle against our prescription drug abuse crisis,” U.S. attorney Annette L. Hayes said. “A company such as Costco that distributes a significant volume of controlled substances has a responsibility to ensure it complies with regulations that help prevent opioids and other dangerous drugs from being misused or otherwise added to the illegal marketplace.”


According to allegations, Costco pharmacies often filled prescriptions that were incomplete or that lacked valid Drug Enforcement Administration (DEA) numbers. Costco also purportedly failed to keep accurate records at its pharmacies of controlled substances.


“Last year [more than] 50,000 Americans died as a result of drug overdoses, many of which were related to the misuse of prescription drugs.  This settlement demonstrates the accountability and responsibility that go along with handling controlled prescription drugs,” said DEA assistant administrator Louis Milione. “The DEA works every day to reinforce good corporate practices through outreach and education efforts and, when appropriate, with administrative and criminal action.”


In addition to the monetary fine, Costco agreed to make changes to improve its pharmacy practices. It will invest $127 million over the next five years on a new pharmacy management system.

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