McKesson Finalizes Settlement with U.S. Department of Justice and U.S. Drug Enforcement Administration to Resolve Past Claims
January 17 2017 - 6:01PM
Business Wire
Settlement resolves past claims regarding
McKesson’s monitoring and reporting of suspicious controlled
substance orders as previously disclosed on April 30, 2015
McKesson Corporation (NYSE:MCK) today announced that it has
finalized administrative and civil settlements to resolve U.S. Drug
Enforcement Administration (DEA) and U.S. Department of Justice
(DOJ) potential federal civil and administrative claims regarding
McKesson’s monitoring and reporting of suspicious controlled
substance orders. The reporting practices dating back to 2009, and
challenged by the DOJ in 2013, are addressed by today’s settlement.
Since 2013, McKesson has implemented significant changes to its
monitoring and reporting processes. The settlement was previously
publicly disclosed in a Form 8-K filed on April 30, 2015, and an
accrual for the anticipated settlement payment was reflected in
McKesson’s fiscal year 2015 (FY15) financial results.
The settlement represents the conclusion of discussions with the
DEA and DOJ over several years regarding McKesson’s interpretation
of the DEA’s regulations for the monitoring and reporting of
suspicious controlled substance orders. In the interest of moving
beyond disagreements about whether McKesson was complying with the
controlled substance regulations during the applicable period and
to instead focus on the company’s partnership with regulators and
others to help stem the opioid epidemic in this country, the
company agreed to settle with the DEA and DOJ.
As part of the settlement, McKesson will pay $150 million and
the DEA will suspend, on a staggered basis for limited periods of
time, McKesson’s DEA registrations to distribute certain controlled
substances from four of McKesson’s U.S. Pharmaceutical distribution
centers.
In recent years, McKesson U.S. Pharmaceutical has put great
effort into implementing significant enhancements to how it
monitors and controls the distribution of controlled substances,
referred to as the company’s Controlled Substance Monitoring
Program (CSMP). McKesson’s team includes numerous individuals with
significant regulatory and anti-diversion expertise who play a lead
role in its due diligence efforts, utilizing advanced analytical
tools to closely monitor our customers’ purchases. McKesson is
proud of its CSMP and will continue its efforts to be an industry
leader in the fight against prescription drug diversion.
“Pharmaceutical distributors play an important role in
identifying and combating prescription drug diversion and abuse.
McKesson, as one of the nation’s largest distributors, takes our
role seriously. We continue to significantly enhance the procedures
and safeguards across our distribution network to help curtail
prescription drug diversion while ensuring patient access to needed
medications,” said John H. Hammergren, chairman and chief executive
officer, McKesson.
McKesson sees prescription drug diversion and abuse as an issue
that needs to be addressed through a comprehensive approach that
includes the patients who become addicted, doctors who write the
prescriptions, the pharmacists who fill them, the distributors who
fulfill and deliver pharmacies’ orders, the manufacturers who make
and promote the products, and the regulators who license the above
activities and determine supply.
“We are committed to tackling this multi-faceted problem in
collaboration with all parties in the supply chain that share the
responsibility for the distribution of opioid medications,”
Hammergren concluded.
McKesson is committed to working with the DEA on an ongoing
basis to identify new ways to prevent misuse of controlled
substances. As part of the settlement agreement reached, McKesson
and the DEA plan to meet regularly over the next five years to
ensure ongoing alignment. This new level of partnership with
regulators, and the enhancements McKesson has made to its CSMP,
strengthens McKesson’s ability to partner with all participants in
the prescription drug supply chain to help prevent diversion while
ensuring services to meet patient needs.
McKesson, in addition to improving the vigorousness of its CSMP,
works to educate its customers about the prevention of prescription
drug abuse. The company also advocates for public policies that
will help address the problem, including the 2015 passage of the
Comprehensive Addiction and Recovery Act (CARA), which contained a
number of provisions for preventing and treating addiction.
McKesson supports more robust funding of those policy
proposals.
About McKesson Corporation
McKesson Corporation, currently ranked 5th on the FORTUNE 500,
is a healthcare services and information technology company
dedicated to making the business of healthcare run better. McKesson
partners with payers, hospitals, physician offices, pharmacies,
pharmaceutical companies, and others across the spectrum of care to
build healthier organizations that deliver better care to patients
in every setting. McKesson helps its customers improve their
financial, operational, and clinical performance with solutions
that include pharmaceutical and medical-surgical supply management,
healthcare information technology, and business and clinical
services. For more information, visit www.mckesson.com.
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version on businesswire.com: http://www.businesswire.com/news/home/20170117006601/en/
McKesson CorporationInvestors and Financial Media:Craig
Mercer, 415-983-8391Craig.Mercer@mckesson.comorGeneral and Business
Media:Kristin Hunter, 415-983-8974Kristin.Hunter@mckesson.com
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