AmerisourceBergen Specialty Group, a wholly-owned subsidiary of the major wholesale drug distributor AmerisourceBergen Corp., pled guilty to illegally distributing misbranded drugs and agreed to pay $260 million to resolve criminal liability for skirting regulatory oversight.
Between 2001 and 2014, according to court records unsealed Wednesday, the group's now-defunct subsidiary Medical Initiatives prepared millions of syringes that had been filled with cancer drugs and shipped them to providers in all 50 states.
Medical Initiatives removed the drugs from their original glass vials and repackaged them into plastic syringes in an unclean and unsterile environment, allowing the company to sell excess drug product in the vials known as "overfill," according to court records. It combined the contents of multiple vials in a process known as "pooling," despite many of the vials carrying a "single-use" designation.
In order to avoid the Food and Drug Administration's regulatory oversight, AmerisourceBergen Specialty Group did not register Medical Initiatives as a repackager or manufacturer with the agency, records show. Instead, the group portrayed Medical Initiatives as a state-regulated pharmacy, exploiting an exemption to the FDA registration requirement that is reserved for legitimate pharmacies, not for manufacturers or repackagers, authorities said.
"Injectable drugs prescribed for patients—especially vulnerable cancer patients—must be pure, sterile and produced in an FDA-compliant facility that is within the supply chain that FDA oversees," special agent in charge Mark McCormack of the FDA Office of Criminal Investigations Metro Washington Field Office said in a statement. "We will continue to pursue and bring to justice those manufacturers who would violate the public's trust and endanger their health by attempting to avoid FDA's oversight authority."
AmerisourceBergen said that while there are no allegations of patient harm, the settlement is the "right approach to resolving the matter with our formerly operating subsidiary, Medical Initiatives, Inc., allowing us to focus on best meeting the needs of customers and patients."
As part of its guilty plea, AmerisourceBergen Specialty Group has agreed to pay a $208 million criminal fine, plus $52 million in criminal forfeiture. It will also maintain a compliance and ethics program designed to increase accountability and transparency, requiring corporate board members to annually review the effectiveness of the company's compliance program and maintain a hotline that will process complaints about any improper practices.