Florida’s Strike Force Raids Pain Management Physicians

Florida is reported to have one of the worst prescription drug abuse problems in the country. Because of this issue, pain management physicians have been under increasing scrutiny and attack by federal and state agencies.  If you are a pain management physician or you work in a pain a management clinic, you need to be aware of the measures that state and federal agencies are taking against doctors who practice pain management and the owners of pain management clinics.

A news release sent out by the Florida Department of Health (DOH) this summer discusses “inspections” of physicians’ offices across the state, allegedly to ensure compliance with Florida’s new prescription drug law (House Bill 7095).  However, many of these may be more aptly termed as “raids.”  These raids, under the guise of being inspections, have resulted in a massive quantity of narcotics being seized from clinics and physicians’ offices by the Strike Force. It is claimed that no search warrants are necessary as the Strike Force states it is performing an “administrative inspection.” The pain management physicians targeted by these inspections are identified based on their purchasing, prescribing and dispensing levels.

Often these “inspections” will include Department of Health Investigators, Florida Department of Law Enforcement Special Agents, local police and law enforcement agents, and Drug Enforcement Administration (DEA) Special Agents.

  •  Our primary concern and warning to the physician or owner is to not talk to any investigators or inspectors, but call your personal attorney immediately. Have the investigator or inspector talk to your attorney. All communications should be with and through your attorney.
  • If you are requested to “voluntarily” relinquish (give up) your DEA registration or your medical license or other professional license, do not do this.  It will not help you and it will make every aspect of your case more difficult to defend.
  • Do not make any statement (oral or written) or allow yourself to be interviewed.
  • Obtain the complete names, addresses, titles and agencies for each agent there.  Obtain their business cards (which they should have).
  • Do not volunteer up any documents, items or information.

To read more about inspections from the document released by the Florida Department of Health click here.

If your office has been “inspected” and you need legal representation, you may call and speak to one of our health attorneys at (407) 331-6620 or (850) 439-1001.

Investors can Continue to Bring Claims Against KV Pharmaceutical

By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

The U.S. Eighth Circuit Court of Appeals ruled that investors can continue to bring claims against KV Pharmaceutical Co. (KV) for making false or misleading statements to the U.S. Food and Drug Administration (FDA). The ruling was reached on June 4, 2012.

To view the appeals court ruling in Public Pension Fund Group v. KV Pharmaceutical Company, click here.

Appeals Court Ruling Revives Securities Fraud Class Action Lawsuit.

The appeals court has revived a securities fraud class action that was dismissed by a trial court in 2010. Investors pursued the fraud claims in a case filed in 2009 in U.S. District Court in St. Louis. In the lawsuit, investors allege that they suffered $1.5 billion in losses. The investors claim that the loss was suffered because KV allegedly misled the FDA in its compliance reports. KV then shut down its manufacturing operations in 2009.

Investors Allege KV Was Not Honest About FDA Compliance.

The lawsuit focused on FDA inspections of KV facilities over a six-year period. Results of those inspections were reported to the company’s management on a document called a Form 483. Investors alleged that information on the forms about KV’s compliance with FDA regulations contradicted statements KV made to investors. Allegedly, the forms stated that KV was not in compliance with FDA regulations.

However, KV said that the forms did not show the FDA’s final determination. The district court agreed with KV and dismissed the suit.

Appeals Court Decision May Have Ramifications for Other Drug Manufacturers.

The appeals court reversed the dismissal of the lawsuit. According to the appeals court, investors could have considered the Form 483 reports significant given the company’s assurance that it was in compliance.

The appeals court decision could have implications for other drug manufacturing companies. The decision represents the first time a federal appeals court has determined that FDA’s issuance of a Form 483 can be considered material under federal securities laws.

KV Has Recently Experienced Several Setbacks in Addition to the Investor Lawsuit.

The appeals court decision is the latest setback for KV. Starting in 2008, the generic drug manufacturer was subject to a series of recalls and investigations by the U.S. Department of Justice and the FDA. The investigations were related to KV’s manufacturing and distribution of oversized morphine pills.

In 2010, KV’s former subsidiary Ethex Corp. pleaded guilty to two felony counts of criminal fraud. Ethex Corp. agreed to pay $27.6 million in fines and restitution related to the charges. To view a press release from the U.S. Department of Justice regarding the charges against Ethex, click here.

In 2011, KV’s former chief executive pleaded guilty to misdemeanor violations of the Food, Drug and Cosmetic Act. He was sentenced to 30 days in jail and ordered to pay $1.9 million in fines and forfeitures.

Contact Health Law Attorneys Experienced in Representing Pharmacies and Pharmacists.

The Health Law Firm represents pharmacists and pharmacies in investigations, regulatory matters, licensing issues, litigation, inspections and audits. The firm’s attorneys include those who are board certified by The Florida Bar in Health Law as well as licensed health professionals who are also attorneys.

To contact The Health Law Firm, please call (407) 331-6620 or (850) 439-1001 and visit our website at www.TheHealthLawFirm.com.

Sources Include:

Harris, Andrew. “KV Pharmaceutical Must Face Suit Over Quality Assurances.” Bloomberg News. (June 4, 2012) From: http://www.businessweek.com/news/2012-06-04/kv-pharmaceutical-must-face-suit-over-quality-assurances

Raymond, Nate. “U.S. Court Revives KV Pharmaceutical Investor Suit.” Reuters. (June 4, 2012). From: http://www.msnbc.msn.com/id/47681167/ns/health/t/us-court-revives-kv-pharmaceutical-investor-suit/

About the Author:  George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law.  He is the President and Managing Partner of The Health Law Firm, which has a national practice.  Its main office is in the Orlando, Florida, area.  www.TheHealthLawFirm.com  The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone:  (407) 331-6620.

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