SEATTLE (Legal Newsline) - Attorneys for the Washington State Attorney General’s Office in their lawsuit against three major opioid drug distributors continued to hammer down on the theme the companies irresponsibly flooded the market with pills, causing an overdose epidemic.
Trial in the Kings County Superior Court resumed on Monday before Judge Michael Scott, without a jury.
“They (McKesson Corp.) could give me no reason why,” Joe Rannazzisi, former head of the Office for Diversion Control with the U.S. Drug Enforcement Agency (DEA) told a courtroom in previously recorded testimony. “They (McKesson) shuffled papers and looked around. One guy said, ‘I guess you’ve got us.’”
The statement was later challenged on cross examination.
An attorney for the state sat in a witness chair and read for the courtroom Rannazzisi’s testimony taken last June.
In charge of ensuring that distributors obeyed the federal guidelines of the Controlled Substances Act of 1970 (CSA), Rannazzisi described a system that he said had spiraled out of control in the early 2000s through 2014.
While at the DEA until shortly before he retired in 2015, Rannazzisi oversaw the massive increase in the quotas that set how many opioid pills manufacturers can sell. He came to national fame in 2018 after appearing on “60 Minutes” criticizing federal opioid policy as too lax. He has since become a $500-an-hour expert for private lawyers representing state and local governments suing the opioid industry.
The three defendants at trial - McKesson, Cardinal Health and Amerisource Bergen Corp. - are accused of distributing opioid drugs without properly monitoring suspicious orders which resulted in illicit diversions into the wrong hands. A suspicious order is one that deviates from a normal pattern of size (number of pills) or frequency of order. The distributors take the pills from the manufacturers and supply them to hospitals, doctor’s offices and pharmacies.
“There were large breeches in the system,” Rannazzisi said. “Drugs were going into the illicit marketplace. The defendants had a big role.”
In particular, Rannazzisi indicated the epidemic really took off with the emergence of internet pharmacies, not physical brick and mortar pharmacies, where someone could order pills without oversight.
“They had a huge customer base and they used it to veil their activities,” Rannazzisi said of the web pharmacies. "They could operate in warehouses and basements. If you had a room where you could store up drugs, you had an internet pharmacy.”
In 2008, Congress approved the Ryan Haight Online Pharmacy Consumer Protection Act to regulate online internet prescriptions.
The DEA issued memos warning the distributors of ignoring guidelines of the CSA, met with them and conducted their own investigations. However Rannazzisi said DEA officials were limited in their ability to monitor the distributors which he said would require a day to day close inspection of their operations over an extended period of time.
Large distributions of opioids including hydrocodone, alprazolam and phentermine were distributed in states including Florida, Texas and Colorado.
Rannazzisi said a person could receive 120 pills at a time and 15 million hydrocodone tablets were distributed in a single year nationally.
Calling them “rogue pharmacies, pain clinics or chain drug stores,” Rannazzisi said there was serious misconduct among distributors.
“The volumes (drugs) going out were outrageous,” he said.
Rannazzisi said it was the responsibility of the distributors to know their customers, to flag suspicious orders and report them, and to cut off sales if need be.
“The DEA doesn’t know the customer,” Rannazzisi said. “We can’t tell the distributor if an order is legitimate.”
DEA warnings had had little impact, Rannazzisi indicated.
“We expected them to comply and they continued to ship (pills),” he said.
On cross examination, Paul W. Schmidt, defense attorney for McKesson Corp. with the law firm of Covington & Burling based in Washington D.C., said McKesson had revised its policies in 2006 to deal with the situation.
“You have never reviewed a suspicious (drug) order online?” Schmidt asked.
Rannazzisi agreed.
Schmidt displayed a document stating that the defendant (McKesson) was using all the tools it had available to identify and shut down those parties who chose to operate outside the regulations of the CSA.
Schmidt took issue with Rannazzisi’s earlier comment that an official with McKesson at a meeting with DEA personnel had said, “I guess you got us.”
“Could you identify the person who said that?” Schmidt asked.
Rannazzisi said he could not recall.
“Not one person deposed (from the meeting) has told that story,” Schmidt said.
Rannazzisi agreed.
“Did you personally look at the details of how McKesson verified its customers?” Schmidt asked.
“Staff would do it,” Rannazzisi answered.
“Did you personally?”
“I don’t recall.”
Schmidt said there was no language in a DEA Investigator Diversion Manuel that a registrant (distributor) should not fill a suspicious order.
“There is no language that an excessive purchase report will not be accepted,” Schmidt said. “Does it say that?”
“No,” Rannazzisi said.
Rannazzisi said a drug order would not be considered suspicious just because the size of the order was above threshold (average).
Schmidt said McKesson twice updated its policies in 2005-2006 and in 2008 established a “Controlled Substance Monitoring Program.”
“Demand is not driven by supply,” Schmidt said.
“Supply is not what drives demand,” Rannazzisi said.
“Reducing supply does not reduce demand?”
“That is correct,” Rannazzisi said.
“You said that 99% of doctors are doing perfect (prescribing drugs)?”
Rannazzisi agreed.
Schmidt asked Rannazzisi if he had testified to Congress that the overwhelming percentage of prescribing of pain drugs in the country had been conducted responsibly.
“Yes,” Rannazzisi said.
Rannazzisi said the percent of doctors who prescribe pain medications in violation of the CSA was very small (less than .01% out of 75,000 doctors).
However, he agreed that an unreasonable quantity of pain pills could be prescribed by a doctor for a household.
“Some might take them (steal pills), give them away, sell them,” Schmidt said. "A prescription could be filled in good faith. The pharmacy and the manufacturer could do what they were supposed to, and it (drug) could get stolen or given away.”
“Yes,” Rannazzisi said.