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Opioid Trial

Huntington Mayor Steve Williams (left) and lawyer Rusty Webb enter the federal courthouse in Charleston for the opioid trial.

McKesson Corp. made its sales force the company’s “eyes and ears” against illegal drug diversion, all while giving them a chance to double their salaries for making sales, attorneys pointed out in federal court Tuesday in Charleston.

Cabell County and the city of Huntington are arguing that the “Big Three” drug distributors — AmerisourceBergen Drug Co., Cardinal Health Inc. and McKesson — flooded the area with excessive amounts of opioid doses over eight years before a reduction in the pills shipped made addicted users turn to illicit drugs.

The defendants counter that the U.S. Drug Enforcement Administration, doctors and West Virginians’ poor health are the culprits.

Tuesday began with defense attorney Paul Schmidt’s cross-examination of Michael Oriente, director of regulatory affairs for McKesson, who said McKesson was fully transparent with the DEA, although the agency accused the company of violating the Controlled Substances Act at least twice, on one occasion finding 4,600 violations.

In the afternoon, Tim Ashworth, a McKesson salesman, testified on practices in which McKesson’s sales force was on the front line of diversion control by helping gather information from customers who hit their monthly pill order ceilings, all while having a chance to double their salaries through sales.

Oriente said prescriptions are federal Food and Drug Administration approved and manufactured by other companies, which issue alerts or warnings on the drugs. A doctor’s prescription is needed to obtain them individually in the closed system, he said. The DEA kept increasing the quota for the amount of pills that could be shipped each year, to keep up with an increase in prescriptions.

He said a pharmacy simply ordering low quantities of opioids does not mean diversion is not occurring, nor would large quantities indicate diversion. A pharmacy might order a high number of pills because the pharmacist in charge of ordering might be taking a vacation and need to order in advance, he said.

The DEA guidance has not always been clear, Oriente said. In 2006 and 2007, the administration sent letters to distributors outlining changes in what was expected of wholesalers. One of those expectations was having pill order limits or thresholds for each pharmacy. Oriente said it was a project in itself to figure those out, and that thresholds reflected prescriptions.

“As prescribing has gone down, pharmacies have ordered less. Because pharmacies have ordered less, we were able to reduce those thresholds,” he said.

If an order hit a threshold, it would go through a three-level review. The first level involved a questionnaire asking the pharmacy why it needed the threshold increase, requesting sales information.

Cabell County attorney Eric Kennedy said that, according to McKesson protocol, reviews were supposed to be handled by management, but it was Ashworth and other sales members who would be the ones to help pharmacies fill out those questionnaires. Kennedy questioned the ethics behind the practice because, if the pharmacies could not buy pills, then the sales members would lose money.

Some of the questionnaires were incomplete, Kennedy said, pointing to 26 from Cabell County over a two-year period that said an increase was needed but gave no explanation why.

The defense pointed to one fully filled out in October 2010 when the Custom Script, located in the 2400 block of U.S. 60 in Barboursville, sought 7,000 more oxycodone doses a month in its limit. It said they had been “aggressively marketing to practices” to increase business. The marketing included the practice of former doctor Philip Fisher, a physician who is serving a criminal sentence in Florida for a murder-for-hire plot against his sister.

Kennedy claimed McKesson put its sales force in the middle of diversion control. Ashworth said salespeople played a role in collecting information, but it was his bosses who made the ultimate decision. Kennedy pointed to a previous deposition taken from Ashworth in which he had agreed he played a key role in preventing diversion.

From 2008-13, McKesson’s practice was to warn its customers when they were near their threshold and ask if they wanted it to be increased, Kennedy said. Oriente said customers were not told their thresholds.

“There was a period that we were giving that information to let the customer know they were approaching their threshold, because it was all new and it required some explanation,” Ashworth said.

An order would not be labeled suspicious and reported to the DEA until it reached the third level, Oriente said. Sometimes, threshold reviews required a site visit and paperwork review, to check for red flags. Oriente said he would go on site visits weekly.

The directors also would research the Office of Inspector General and newspaper articles to see if any DEA activity had been occurring at the facilities.

The majority of increase requests would come in the last week of the month, which caused frustration among Oriente’s peers, whose emails showed complaining about heavy workloads. They also said it was not possible to be diligent with their case volume.

Oriente said he felt he could still do his job, but that it took longer.

Dave Gustin, a fellow director of regulatory affairs, sent an email in 2011 to his peers stating that areas needed to be tightened up because the distributor’s customers showed large gaps between their purchases and their sales. Schmidt, the defense attorney, said the communication showed in 2011 that distributors were trying to tighten thresholds and were doing extra due diligence.

Gustin also emailed the sales force, stating they were the “eyes and ears” for the directors.

According to a 2020 federal court plea in Kentucky, this was around the time Gustin approved the shipping of 300,000 pills into a rural Kentucky pharmacy, a charge for which he pleaded guilty to a misdemeanor.

The DEA has said McKesson continuously ignored its warnings to tighten its suspicious-order monitoring. A 2008 civil settlement reached between the DEA and McKesson had the company agree to pay $13.25 million in civil penalties to settle allegations it violated the Controlled Substances Act by failing to report suspicious orders of prescription medications.

Oriente said that, in 2008, the DEA was aware McKesson’s standard for setting thresholds was taking the average of the customer’s monthly purchasing for a year-long period and adding 10%. The DEA also knew distributors treated their independent stores differently than the national accounts, such as Rite Aid, because they had their own regulatory staff, he said. The DEA also was told of its three-level review system for large monthly orders, but it did not complain.

Schmidt pointed to a handful of documents he said showed the company had been doing its due diligence and attempting to follow what the DEA wanted.

A second, separate settlement was reached in 2017 in which McKesson agreed to pay $150 million for similar allegations.

As part of the 2017 settlement, McKesson acknowledged that, at various times from 2009-18, it did not report or identify to the DEA some suspicious orders, but Oriente said the admission did not apply to any Cabell County pharmacies.

Reach Courtney Hessler at or follow @HesslerHD on Twitter.

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