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CVS Fined $75M for Allowing Meth-Related Purchases

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By Laura Strachan, Esq. on October 15, 2010 9:57 AM

How did CVS pharmacy manage to get slapped with the largest civil penalty issued under the Controlled Substance Act? By failing to properly monitor repeated purchases of key ingredients used to make methampetamine in at least five states, that's how. The CVS $75 million meth fine is the product of allowing such purchases to continue for over a year, which ultimately help cause the huge increase in Southern California drug trafficking.

Methamphetamine (or meth) is the considered the number one drug concern among law enforcement agencies, according to a study. This is partially attributed to the fact that most of the necessary chemicals are readily available in household products or over the counter cold or allergy medicines. Enter CVS. There are state, federal, and internal policies designed to regulate the sale of meth-related purchases; mainly by limiting the amount of over the counter products (such as cough and allergy medicine) a customer can buy in a day. In reality, customers were allowed to clear the CVS shelves of the meth products, and then go to another local CVS and do it again. One of the main problems with CVS's system for regulating the sales was that the company looked at the total sales in a given day, rather than the amount an indiviudal was buying at a given time.

With over 7,100 stores spanning across the U.S., CVS is the nation's largest retail pharmacy chain. The investigation began in 2008 after several members of a recently arrested Southern California meth lab that told authorities the majority of their ingredients came from CVS. Fox News quotes U.S. Attorney Andre Birotte Jr.:

"This case shows what happens when companies fail to follow their ethical and legal responsibilities. CVS knew it has a duty to prevent methamphetamine trafficking, but it failed to take steps to control the sale of a regulated drug used by methamphetamine cooks as an essential ingredient for their poisonous stew."

The good news is that in paying the $75 million civil fine, CVS will avoid criminal charges. The bad news is that in addition to the fine and facilitating a major drug spike, CVS will also have to forfeit $2.6 million in profits from the sale of the meth-related purchases. The company plans to implement an ethics and compliance program over the next three years, in addition to increasing monitoring technology in the stores at at the distribution centers.

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