Frier Levitt has noticed an increasing trend in State Board of Pharmacy investigations being commenced that closely mimic audit findings issued by Pharmacy Benefit Managers (“PBMs”). These Board of Pharmacy investigations place additional burden upon the pharmacies already responding to PBM audits, but in some instances, can also lead to administrative, civil, and/or criminal sanctions on the pharmacies, pharmacists, and pharmacy owners (collectively, “Disciplinary Actions”). What’s more, many PBMs require their member pharmacies to self-report any Disciplinary Actions within certain timeframe. More troubling, PBMs routinely use Disciplinary Actions as a basis to terminate a pharmacy from its pharmacy network.
As noted above, recent Board of Pharmacy investigations conducted on a pharmacy mimic or include a portion of a PBM’s audit findings issued to the pharmacy. This suggests that not only are PBMs reporting audit findings to Boards of Pharmacy at an increasing frequency, but Boards of Pharmacy are using the audit findings as their legal basis when issuing alleged state law violations, charges, or Disciplinary Actions. In a recent example, while responding to and challenging a PBM’s audit findings alleging discrepancies for certain prescriptions, the pharmacy received a subpoena from the Board of Pharmacy seeking production of prescription hardcopies for those same prescriptions, along with other prescription-related records. Shortly after complying with the subpoena, the Board of Pharmacy issued a complaint against the pharmacy, alleging state law violations essentially mirroring the discrepancies raised in the PBM’s audit findings.
The number of Board of Pharmacy investigations following PBM audits has gone up in the recent past. This is a concerning development for several reasons. The pharmacies, pharmacists, and pharmacy owners not only have to spend their time and resource to respond to the Board investigations but also to defend themselves from potential Disciplinary Actions. What’s worse, PBMs are reporting discrepancies to Boards of Pharmacy that stem from what are essentially alleged contractual breaches, not violations of the Pharmacy Practice Act. With the uptick in Board of Pharmacy investigations, there is a growing concern that contractual breaches might be bootstrapped into allegations of professional misconduct by the pharmacy or its staff.
How Frier Levitt Can Help
Each State Board of Pharmacy handles matters differently, and there is no one size fits all response to a matter involving a potential violation of a State Board of Pharmacy regulation. Frier Levitt has substantial experience working the Boards of Pharmacy across the fifty states and is well positioned to counsel pharmacies with custom advice relating to the specific State Board and specific issue at hand. Contact Frier Levitt to speak to an attorney if you receive a letter from a licensing board requesting your response to a complaint or demanding your appearance before a committee of the Board.
