Pharmaceutical distributor to pay $13 million in fines

May 03, 2008|By Josh Mitchell

Prescription drug distributor McKesson Corp. has agreed to pay $13 million in civil fines to settle allegations that it failed to report as suspicious sales of large quantities of drugs, federal prosecutors in Maryland said yesterday.

Under an agreement between the California-based company and U.S. attorney's offices in six states including Maryland, McKesson will also create policies beyond those required by federal regulation to detect and prevent illegal drug diversion.

The Maryland claims, which account for $2 million of the fines, centered on McKesson's dealings with NewCare Pharmacy in East Baltimore and Smeeta Pharmacy in Highland.Prosecutors said McKesson's Landover distribution center sold 3 million units of hydrocodone to NewCare and large quantities of phentermine-based products to Smeeta.

The sales should have been reported to Drug Enforcement Agency officials, said Marcia Murphy, a spokeswoman for Maryland U.S. Attorney Rod J. Rosenstein.

NewCare's owners have been indicted on federal charges of illegally selling more than 9.9 million dosage units of hydrocodone as part of a nationwide Internet operation in 2005 and 2006. Their trial is scheduled to begin May 19.

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