The DEA's case against Mallinckrodt has odd parallels to the gun industry

This is one of those stories which has been percolating on the back burner of national news coverage for years and may now be coming to a close. Beginning early in the Obama administration, the Drug Enforcement Agency (DEA) began pursuing possible charges against pharmaceutical giant Mallinckrodt, the major producer of oxycodone. In response to an epidemic of these pills mysteriously showing up on the black market for illegal sale (what the industry refers to as “diversion”) and subsequently leading to high numbers of overdose deaths, the DEA sought to find out if the manufacturer was somehow responsible. Now, as detailed in this special report at the Washington Post, there’s apparently going to be an unofficial but extremely expensive “settlement” which will make the whole thing go away.

To combat an escalating opioid epidemic, the Drug Enforcement Administration trained its sights in 2011 on Mallinckrodt Pharmaceuticals, one of the nation’s largest manufacturers of the highly addictive generic painkiller oxycodone.

It was the first time the DEA had targeted a manufacturer of opioids for alleged violations of laws designed to prevent diversion of legal narcotics to the black market. And it would become the largest prescription-drug case the agency has pursued…

But six years later, after four investigations that spanned five states, the government has taken no legal action against Mallinckrodt. Instead, the company has reached a tentative settlement with federal prosecutors, according to sources familiar with the discussions. Under the proposal, which remains confidential, Mallinckrodt would agree to pay a $35 million fine and admit no wrongdoing.

The opioid epidemic is nothing to joke about, so the initial investigation clearly had merit. But all along there seemed to be an obvious question hanging over the investigation. If Mallinckrodt was producing a legal product (which they were) and it was winding up on the streets in the hands of drug dealers, how did the pills get “diverted” from the normal delivery process? If it could be shown that Mallinckrodt executives or sales people were shipping tons of the drugs to some gang lords outside of Miami then the case would be pretty clear. Lock ’em up! But if they were following the rules, how were they responsible?

It all seems to boil down to some rather vague instructions from the FDA which require manufacturers to report instances where there are “unusual” ordering patterns from customers. The customers in this case are legally authorized distributors who purchase the medicine in bulk and then market the pills to doctors, hospitals, pharmacies, etc. In the case of the oxycodone, some big orders were coming in from Florida and eventually winding up on the streets. But at the same time, it was being reported years ago that doctors were writing alarming numbers of prescriptions for the drug. It was a booming business and the distributors were obviously ordering record amounts of the pills. What qualifies as “unusual” under those circumstances?

This sounds suspiciously similar to efforts to impose massive fines and penalties on firearms manufacturers when they produce a legal product which winds up in the wrong hands. (See the Newtown lawsuit for only one of many examples.) If the firearm was legally allowed under the law but someone else then either sold it to a criminal or a person legally purchased it and committed a crime, that’s not the fault of the manufacturer. Why would we be applying a different standard to a drug manufacturer? This might be a sign that we need something along the lines of a Protection of Lawful Commerce in Pharmaceuticals Act.

Instead, we wind up with the odious resolution which the Mallinckrodt investigation is set to produce. They end up in a situation where they “admit no wrongdoing” but still have to shell out tens of millions of dollars to the DEA. If they didn’t do anything wrong, why are they paying all that money? And if they actually did break the law, shouldn’t the government have to prove that in court? The entire thing stinks on ice if you ask me.