SHERMAN, Texas (Legal Newsline) - Walmart fired a warning shot at the U.S. government in advance of an expected opioid lawsuit, asking a federal court to declare invalid claims that its pharmacies can be held liable for filling prescriptions written by licensed doctors and failing to follow standards that don’t appear in the law.
The Arkansas retail giant filed a 54-page declaratory judgment complaint in U.S. District Court in Texas on Thursday, saying the legal theories the government is expected to pursue are illegitimate and based upon unclear or conflicting standards. The opioid crisis has more to do with the government’s “inept and inadequate” efforts to control opioid production and police physicians than any failures by pharmacists, Walmart said.
Meanwhile, the company says federal prosecutors pursued a lengthy and so far fruitless investigation of Walmart that included threats of criminal prosecution and leaks to the news media to try to convince it to pay a multibillion-dollar settlement.
Walmart is suing under the federal Declaratory Judgment Act, which allows courts to resolve fundamental legal disputes such as the extent of coverage under an insurance contract or whether certain activity is legal. If Walmart were to succeed, it could use the ruling to thwart federal claims elsewhere. But Walmart may face long odds convincing a federal judge to rule out the basis for what could be tens of billions of dollars in claims before the litigation even begins.
So-called “dispensing” claims represent the third wave of litigation against the opioid industry, after lawsuits accusing manufacturers of misleading prescribers and wholesale distributors of failing to halt suspicious shipments to pharmacies. They are based upon the theory that pharmacists and the companies that employ them have a duty to monitor prescriptions for “red flags,” report suspicious activity to the government, and refuse to fill prescriptions that are inappropriate or illegal.
In its lawsuit, Walmart says those duties appear nowhere in the Controlled Substances Act or other federal statutes and instead have been assembled from “guidance letters” that don’t have the effect of law. Pharmacists who refuse to fill prescriptions from licensed doctors, meanwhile, face liability or enforcement actions by state regulators for the unauthorized practice of medicine, Walmart says.
Under the theory of government plaintiffs who have sued pharmacies elsewhere, pharmacists should stop filling prescriptions from doctors who trigger “red flag” warnings such as writing scrips for people living in different cities or for higher-than-normal doses. But Walmart said 70% of the doctors the Justice Dept. has identified as having written problematic prescriptions still are licensed by the DEA to prescribe opioids.
“In other words, Defendants want to blame Walmart for continuing to fill purportedly bad prescriptions written by doctors that DEA and state regulators enabled to write those prescriptions in the first place and continue to stand by today,” the company said.
Federal law assigns most of the responsibility for prescribing opioids to licensed practitioners, but says “a corresponding responsibility rests with the pharmacist” not to knowingly fill illegitimate prescriptions. DEA rules don’t provide specific guidelines on when a pharmacist should block a prescription written by a DEA-licensed doctor, however, other than advising them not to fill scrips that are “doubtful, questionable or suspicious.”
Some states have ordered pharmacists to fill all prescriptions written by licensed practitioners. Tennessee says the only requirement is that the prescriber has a valid DEA license, Walmart says, and the Idaho Board of Pharmacy advised pharmacists not to block all of the prescriptions written by a doctor who had been arrested on suspicion of narcotics trafficking.
The Justice Dept. also has declared all so-called “trinity” prescriptions for opioids, benzodiazepine and muscle relaxers to be illegitimate, for example, but many medical experts disagree and the Centers for Medicare Services still fills them.
Walmart said it has established systems to block prescriptions from suspicious doctors at all of its pharmacies nationwide, drawing criticism from the American Medical Association, which in a 2019 letter said “disrupted legitimate medical practices.” Some state regulators also say state law prohibits corporate headquarters from interfering in the decisions of individual pharmacists, the company said. The Texas Medical Board also met with Walmart in 2019 over concerns the company’s pharmacists were engaging in the unauthorized practice of medicine when they refused to fill opioid prescriptions or changed the dose.
The federal government’s investigation of Walmart began in 2016 with the U.S. Attorney’s Office in Eastern Texas, where prosecutors told the company in 2018 they planned to indict Walmart for failing to block all prescriptions from a suspicious local physician. Walmart cooperated fully with the investigation but says at one point the lead prosecutor “took out her cell phone and read aloud a confidential text message” she said came from the U.S. Attorney directing her to “terminate the meeting, indict Walmart, and settle with the company after the indictment.”
“This was a clear violation of DOJ policy and professional ethics rules that prohibit the use of threat of criminal charges to extract a civil penalty,” Walmart said. One federal prosecutor said Walmart’s $1 billion in charitable contributions the prior year was evidence of what the company could pay. Walmart says it complained to Washington and in August 2018 the Justice Dept. formally declined to prosecute.
After federal prosecutors continued to investigate and threatened to leak documents they obtained in discovery to the media, the company says it filed a formal complaint.