One of the DEA’s latest enforcement cases against pharmacy is the case against Gulf Med Pharmacy. It is a good reminder of what the DEA audit focuses on. It also has a few new points, as explained in this blog post.

Gulf Med Pharmacy was a small independent pharmacy in southeast Florida. The DEA flagged the pharmacy due to its large orders of controlled substances. The DEA alleged that the pharmacy was one of the top ten purchasers of Oxycodone, Hydromorphone, and Hydrocodone in the entire state of Florida.

After the conclusion of its investigation,[1] the DEA issued an Order to Show Cause and Immediate Suspension of Registration to the pharmacy. The pharmacy timely requested a hearing before an Administrative Law Judge (“ALJ”). During the hearing the DEA alleged the following violations of the Controlled Substances Act (“CSA”):

  1.     Cocktail Medications

The DEA presented an expert opinion that the pharmacy dispensed cocktail medications which had no legitimate medical purpose. Cocktail medications are combinations of controlled substances that are widely known to be abused or diverted. For example, the DEA identified the following drug cocktails that allegedly raised red flags and had to be resolved prior to dispensing:

– 120 units of hydromorphone 8 mg, 60 units of morphine sulfate extended release 15mg, and 30 units of diazepam 10 mg.

– 120 units of hydromorphone 8 mg, 60 units of morphine sulfate extended release 30 mg, and 60–90 units of alprazolam 1 mg.

– 120 units of oxycodone 30 mg, 60 units of morphine sulfate extended release 30 mg, and 90 units of alprazolam

According to the DEA’s expert, the cocktail of an opioid, a benzodiazepine, and carisoprodol—commonly known as the ‘‘Trinity’’ cocktail—is a particularly serious red flag because that combination of controlled substances is highly dangerous and is widely known to be abused and/or diverted.

The DEA argued that the pharmacy repeatedly dispensed Trinity cocktail medications without any indication that its pharmacists addressed or resolved the fact that such prescriptions present a risk of abuse or diversion.

  1.    Improper Dosing for Pain Management

(Attention: this is not a commonly seen allegation).

The DEA alleged that the pharmacy repeatedly filled prescriptions for patients receiving a much greater daily morphine milligram equivalent dosage of short-acting opioids than long-acting opioids.

According to the DEA’s expert, for a patient receiving treatment with both long-acting and short-acting opioids, the proper pharmacologic dosing for pain management is to use larger, scheduled doses of the long-acting opioid to control chronic pain with smaller, as needed doses of the short-acting opioid for breakthrough pain.

The expert also testified that this method of dosing reduces the amount of the short-acting opioid that the patient must use in order to obtain the same level of pain control. The expert opined that prescriptions that provide a larger daily dose of short-acting opioids, rather than long-acting opioids, do not make pharmacologic sense and thus are a red flag of drug abuse or diversion.

The expert also noted that each of the short-acting or immediate release opioid prescriptions was scheduled four times a day or every six hours, even though the patient was also prescribed a scheduled, long-acting opioid.

  1.     Long Distances

The DEA presented evidence that some patients travelled on average 45 miles roundtrip to obtain their controlled substance medications.

  1.     Cash Payments

Some of the patients paid cash for their controlled substance medications. But according to the DEA’s expert, when a prescription for a controlled substance is electronically processed through insurance, the insurance company will frequently reject suspicious controlled substance prescriptions that may be related to drug abuse or diversion, such as controlled substance prescriptions for the same patient filled at multiple pharmacies. Such cash payments are especially suspicious when the patient bills insurance for other prescriptions, but pays cash for controlled substance prescriptions.

  1. Inflated Prices

(Attention: this is not a commonly seen allegation).

The DEA presented evidence that for controlled substance medications the pharmacy was charging its cash patients over three times the market rate. The DEA alleged that patients paying inflated prices for controlled substance prescriptions is another red flag of drug abuse or diversion, especially when the price paid is substantially higher than the market price available from other nearby pharmacies. According to the Diversion Investigator’s testimony, filling controlled substance prescriptions at inflated cash prices shows that a pharmacy has knowledge that it is filling prescriptions that are not legitimate, as its inflated prices reflect a ‘‘risk premium’’ that the pharmacy charges to account for the risk it is taking by filling illegitimate prescriptions.


The pharmacy disputed the above allegations by presenting evidence and expert opinions arguing that:

–  the DEA’s position that drug combinations and improper dosing present red flags  was not supported by medical literature.

– patients were traveling from some of the barrier islands. The distance between a straight line and coming from the barrier islands and comparing them to facilities on the mainland was a significant factor that was not considered by the DEA or its expert witness.

– the pharmacy based its cash prices on the cost of acquisition (therefore, it did not inflate its cash prices). It argued that the DEA based “market rate” on the National Average Drug Acquisition Cost (“NADAC”), which often reflects chain pharmacy acquisition cost across the nation. It presented evidence that an independent pharmacy in Florida acquires these medications at higher cost.

– the DEA did not interview any of the physicians or patients to verify the legitimacy of these prescriptions.


At the conclusion of the hearing process, the ALJ rendered an opinion explaining that while the pharmacy staff testified that they resolved red flags (by discussing their concerns with the prescribers and patients), there was no documentary evidence to corroborate this claim. This again, brings us to one of the pillars of compliance: document your conversations with patients and prescribers. The ALJ also noted that the pharmacy’s lack of acknowledgement of any wrongdoing, makes it possible that the alleged conduct continues, jeopardizing public safety. In fact, the pharmacy presented no evidence of any remediation going forward. As a result, the ALJ agreed with the DEA and recommended that the pharmacy’s registration be revoked.

This case is just another reminder of the importance of record-keeping, ongoing conversations with prescribers, flagging “cocktail medications” scrips, and conversations with the patients who are paying cash or travel long distances (anything over 10 miles).


[1] Click here to read more about the investigation and hearing (Federal Register/Vol. 86, No. 243 (2021))