Levittown Doctor Agrees to Pay Nearly $500 K for Substance Act Violations

United States Attorney Jacqueline C. Romero announced last week Kenneth Fox, D.O., has agreed to pay $489,025 to resolve allegations that he violated the Controlled Substances Act (CSA) by failing to maintain complete and accurate records of controlled substances, failing to keep required receipt and dispensing records, failing to perform biennial inventories, and writing prescriptions “for stock.”

The United States’ investigation involved Fox’s practice located at 1310 Frosty Hollow Road, Levittown, PA 19056.

As part of the settlement, Fox has entered into a three-year Memorandum of Agreement (MOA) with the Drug Enforcement Administration (DEA), which includes additional responsibilities regarding the handling of controlled substances. The MOA imposes compliance obligations significantly more stringent than those in the applicable laws and regulations.

Fox prescribes and administers phentermine, a Schedule IV controlled substance, and suboxone, a Schedule III controlled substance.  In February 2013, DEA Investigators discovered that Fox allegedly failed to conduct a biennial inventory, failed to maintain records for receipt and dispensing of controlled substances, and failed to keep controlled substances secure – all in violation of applicable regulations and statutes.  In April 2013, the DEA issued a Letter of Admonition to Fox, who agreed to correct his conduct thenceforth.

Nine years later, the DEA performed another scheduled on-site inspection of Fox’s facility. During this inspection, Investigators discovered that Fox continued the same violations as before, and in addition, was prescribing controlled substances “for stock” in violation of the applicable regulations. On the date of inspection, Fox allegedly produced non-compliant and incomplete dispensing records, and no records of biennial inventory, or invoices/receipts for controlled substances. The Investigators obtained records of Fox’s prescriptions “for stock” from a local retail pharmacy.  Physicians are prohibited from obtaining controlled substances for the purpose of general dispensing to patients; they must comply with the requirements for a valid prescription, including the date, patient’s name and address, drug name and strength, dosage form, quantity prescribed, directions for use, and the physician/registrant’s name, address, and registration number.  The prescription requirement is one of the ways in which controlled substances are tracked to prevent diversion and abuse.

“Physicians who fail to maintain proper records of controlled substances create conditions ripe for diversion, or, at worst, may be engaging in diversion itself,” said U.S. Attorney Romero. “Physicians and pharmacists have a responsibility to ensure that all controlled substances are tracked through the distribution chain.  Our Office is committed to ensuring total compliance with the Controlled Substances Act and we will vigorously enforce violations wherever we find them.”

Congress enacted the CSA to deter the illegal importation, manufacture, distribution, possession, and improper use of controlled substances, including prescription medications, and requires individuals and entities registered with the DEA to maintain complete and accurate records of all controlled substances and security systems so that controlled substances are not lost, stolen, or inappropriately dispensed.

“The goal of DEA’s closed system of distribution is to insure accountability for controlled substances; it insures that end-users directly receive controlled substances from where they were dispensed,” said Thomas Hodnett, Special Agent in Charge of the DEA’s Philadelphia Field Division. “In ordering controlled substances “for stock” at his office, Dr. Fox made himself a middle-man in this same closed system and created an environment where controlled substances are not properly inventoried or secured.”

The government’s pursuit of this matter illustrates its emphasis on combating diversion of controlled substances.  The record keeping and other regulations applicable to DEA registrants, including physicians, are the tools by which the DEA deters drug diversion.

The investigation was conducted by the DEA’s Philadelphia Field Division, Diversion Groups D71 and D72, and the investigation and settlement were handled by Assistant U.S. Attorney Viveca D. Parker, with assistance from Asset Investigator Shantelle Kitchen-Nelson.

The claims resolved by this settlement are allegations only and there has been no determination of liability.