Drug Distributor Vows to Fight DEA

By Pat Anson, PNN Editor

The fourth-largest drug distributor in the U.S. is vowing to fight efforts by the Drug Enforcement Administration to strip it of its license to sell opioids and other controlled substances to pharmacies, hospitals and health systems in 27 states.

Such a move by the DEA, if carried out, would not only put Morris & Dickson out of business but could exacerbate already tight supplies of pain medication and drugs used to treat cancer and attention deficit disorder (ADHD). The company said it would “vigorously appeal” the license revocation and seek a stay in federal court.

“We strongly believe any attempt to revoke our registration would be unwarranted and unjustified. Most importantly, any decision the DEA makes will not disrupt our operations. Business will continue as usual, and orders will continue to go out on time,” the Louisiana-based company said in a statement on its website.

The DEA announced Friday that it would revoke Morris & Dickson’s license, but allowed 90 days before the order takes effect. The action stems from a DEA investigation that identified thousands of suspiciously large orders for oxycodone and hydrocodone that the company sold to independent pharmacies in Louisiana from 2014 to 2018. In some cases, according to the DEA, the pharmacies were allowed to purchase six times the amount of opioids that they would normally order.

The DEA suspended Morris & Dickson’s license in 2018, but then delayed making a final decision on revoking it, which allowed the company to continue to operate. That five year delay came to a sudden end this week, after the Associated Press reported that the DEA failed to stop the company from “shipping highly addictive painkillers,” even after a judge recommended that its license be revoked for its “cavalier disregard” of the suspicious orders.

Further complicating the case is that a top DEA official retired from the agency in 2017 and went to work for Morris & Dickson, leading efforts at the company to improve the way it identifies and reports suspicious orders. Louis Milione “unretired” in 2021 and went back to work at the DEA as principal deputy administrator.    

Morris & Dickson spent millions of dollars improving its compliance system, but that was not enough for DEA Administrator Ann Milgram, who has come under increasing fire for her personnel decisions at the agency.

“Respondent (Morris & Dickson) has not adequately convinced the Agency that it can be entrusted with a registration — its acceptance of responsibility did not prove that it or its principals understand the full extent of their wrongdoing, the effect that it had on the Agency and the American public, and the potential harm that it caused. It was Respondent's burden to prove that it could be entrusted to protect the public interest in maintaining a DEA registration — and it has failed to do so,” Milgram said in her 68-page order.

Milgram said she would deny any application by Morris & Dickson to renew or modify its registration, and said her order would become final on August 28, 2023.

The company, however, said it would continue its “ongoing discussion” with the DEA to keep its license.

“Morris & Dickson is grateful to the DEA Administrator for delaying the effective date of the Order to allow time to settle these old issues, which has been our goal since this started years ago,” the company said. “We remain confident we can achieve an outcome that safeguards the supply chain for all of our healthcare partners and the communities they serve.”

That supply chain has been severely strained in recent years, not only by the pandemic, but by DEA actions that reduced the supply of opioids and other controlled substances.

In March, the American Society of Health-System Pharmacists added oxycodone to its list of drug shortages, after generic drug makers Amneal, Camber and Rhodes Pharmaceuticals reported they were running out of some doses of oxycodone tablets.

This month Teva Pharmaceutical said it would discontinue production of immediate release oxycodone and scale back its generic drug business to focus on more profitable medications.

The nation’s three largest drug distributors – McKesson, AmerisourceBergen and Cardinal Health — have already imposed strict limits on the amount of opioids and other controlled substances they sell as part of a $21 billion opioid litigation settlement. Whether they would be able to take on additional customers and supply them with essential medications that Morris & Dickson now provides is an open question.

“It’s hard to say what the overall impact would be. I don’t know how many pharmacies or hospitals are only serviced by Morris & Dickson,” says Erin Fox, PharmD, Senior Pharmacy Director at University of Utah Health, who has been tracking drug shortages for over 20 years. “They would have to establish contracts with another wholesaler. If pharmacies and hospitals have a secondary wholesaler, then they should be able to access opioids to dispense for patients.”