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Rogue Internet Pharmacies: Is S. 980 the Answer?

Judy McKee, Project Coordinator and Counsel, End of Life Health Care

In May of this year, the National Center on Addiction and Substance Abuse (CASA) issued a white paper, “You’ve Got Drugs” IV: Prescription Drug Pushers on the Internet. The report noted that Internet sites advertising controlled substances increased by 135 percent, from 168 in 2006 to 394 in 2007. Sites actually selling controlled prescription drugs increased by 7 percent, from 174 in 2006 to187 in 2007. Only two of these were certified by the National Association of Boards of Pharmacy as Verified Internet Pharmacy Practice Sites.® Eighty-four percent of these sites did not require a prescription. Those that did merely required that a prescription be faxed, making it easy for a person to forge or use a legitimate prescription over and over.

How do those rogue Internet pharmacies work? Affpower, recently indicted by a federal grand jury in San Diego along with 18 individuals, provides an example. In less than two years, the Affpower enterprise allegedly generated an excess of $126 million in gross revenue, receiving more than one million Internet orders for controlled and non-controlled prescription drugs from customers in all 50 states. According to the indictment, Affpower paid licensed doctors from different states and Puerto Rico to review “health” questionnaires filled out by customers, issuing prescriptions based solely on the answers. None of the doctors performed a physical or mental exam; no diagnostic tests were ordered or results received; there was no contact with customers; there was no physician-patient relationship. It is alleged that, in some cases, a non-physician wrote the prescriptions, using the stolen identity of a licensed physician.

Affpower was based in Costa Rica. Its computer servers, as well as several bank accounts and an accounting firm it used, were located in Cyprus. Credit card servicing was also conducted overseas. One of those companies was in Tel Aviv, Israel.

Not all rogue pharmacies use such far-flung operations, however. Many of these operations are based entirely in the United States. They differ from lawful Internet pharmacies, which fill a critical need for rural customers, the elderly, and the home-bound; the rogue pharmacies do not require a valid prescription from a customer’s doctor with whom there is a genuine patient-physician relationship. The questionnaires that these rogue pharmacies ask consumers to fill out are not designed to provide information so that a doctor can properly diagnose a patient’s ailments. Instead, the questions asked are intended to elicit answers to two primary questions: what drug does the customer want and how is he going to pay for it?

Unlike their legal counterparts, these rogue pharmacies typically provide primarily Schedule III and IV medications and lifestyle drugs.[1] It is unlikely that any Internet surfer without a good pop-up blocker has not encountered advertisements for some of these operations and most have received their spam e-mails.

Facilitators find doctors to write prescriptions by targeting practitioners with debt problems and retired doctors wishing to earn some income. These facilitators tell the doctor that the consumer will provide a medical history. The usual pay to the doctors for every prescription authorized is from $10 to $25. Some doctors have been known to authorize hundreds of prescriptions a day.

These same facilitators will find regular pharmacies to fill the “prescriptions,” telling them that all they need to do is fill and ship, that all prescriptions are only for Schedule III or schedule IV substances (and are much less dangerous than Schedule II substances), and that the prescriptions have been approved by a doctor. Sometimes the Internet business is so lucrative, pharmacies involved in the scheme will shut their doors to regular customers and simply focus on the business sent to them by the websites that the facilitator sets up.

According to testimony by Joseph Rannazzisi, deputy assistant administrator, Drug Enforcement Administration (DEA), in 2006, 34 known or suspected rogue Internet pharmacies dispensed 98,566,711 dosage units of hydrocodone-combination products; that is enough to supply more than 410,000 actual patients with a one-month supply at the maximum amount recommended per prescription. Controlled substances account for 11 percent of dosages at legitimate pharmacies; they account for 95 percent of dosages at the rogue Internet pharmacies.

Over the last few years, legislators have proposed a number of bills to address the burgeoning problem of prescription drug diversion that is facilitated by rogue Internet pharmacies. Although Schedule II drugs, such as OxyContinâ, are usually illegally obtained from relatives and friends, through doctor shopping or on the street, Schedule III and IV drugs, such as some tranquilizers, anabolic steroids, and hydrocodone combination products are, in many cases, simply being ordered over the Internet and shipped to potential abusers and dealers. Former U.S. Secretary of Health, Education, and Welfare Joseph A. Califano, Jr., CASA’s chair and president, recently testified that “the Internet has become a pharmaceutical candy store stocked with addictive drugs, available at the click of a mouse to any kid with a credit card number.”

This legislative session, Senators Dianne Feinstein (D-CA) and Jeff Sessions (R-AL) are sponsoring S.980, the Online Pharmacy Consumer Protection Act.[2] Hearings were held in May on the bill and it was reported out of the Judiciary Committee in September. Although it is extremely unlikely that the bill will come up for a vote anytime soon, with the issue very much on the DEA’s agenda, prescription drug abuse on the rise and the recent press coverage of anabolic steroid abuse among athletes, it is likely that the bill, or one similar, will remain on Congress’ agenda.

The bill amends the Controlled Substances Act. It prohibits an Internet pharmacy from dispensing or selling a controlled substance without an in-person examination by a physician. It imposes disclosure standards for Internet pharmacies, requiring them to disclose the name and address of the pharmacy, a list of states in which the pharmacy is licensed to operate, and contact information for the pharmacist in charge. It increases the penalties for illegal distributions of Schedule III, IV and V substances. Internet pharmacies must be specifically registered for dispensing over the Internet and would be required to report the controlled substances dispensed under that registration. The pharmacies must also be licensed in each state in which they will dispense medications.

The bill would also permit the Attorney General of a state to apply for injunctions or obtain damages and other civil remedies against an online pharmacy that poses a threat to state residents in federal district court, no matter where that pharmacy is headquartered. Venue may be where business is transacted or as governed by 28 U.S.C. § 1391. Prior service on the U.S. Attorney General and the U.S. Attorney for the district is required or, where not feasible, concurrent service is appropriate. The federal government then has 120 days to intervene. The state action will not affect any other independent action. The bill specifically states that the authority given to state Attorneys General does not affect any other rights that are afforded by a particular state.

The bill contains some of the recommendations that CASA has put forth. Perhaps, the most troubling aspect for the states is the requirement of an in-person examination. If a state were to allow physicians to prescribe controlled substances in a telemedicine environment, this bill would preempt such authorization. The Department of Veteran Affairs and the Bureau of Indian Affairs have also expressed concern that such a broad prohibition might affect delivery of services to their clientele. Those concerns could be alleviated if a provision were added exempting the in-person examination requirement prescriptions written in strict accord with telemedicine rules and regulations promulgated by a state or federal agency. Another objection to the bill has been that the National Association of Boards of Pharmacy views the problem of Internet pharmacies as a state issue, not a federal one.

Some states, such as Kentucky, have passed their own laws that require pharmacies that ship to residents of that state to register with the state board of pharmacy. In lieu of federal legislation, states may want to pursue this option as a way to protect their citizens. Those states with a prescription-monitoring program could then require these Internet pharmacies to report sales of controlled substances covered by those programs.

There is some opposition by advocates for chronic pain patients on any legislation that would curtail consumers from ordering from Internet pharmacies. States considering legislation will have to balance their concern that patients receive appropriate and adequate medications with the need to protect their citizens, especially young people, from the lure of obtaining controlled substances over the Internet.

[1] The Controlled Substances Act (CSA), Title II and Title III of the Comprehensive Drug Abuse Prevention and Control Act of 1970, is the legal foundation of the U.S. Government's fight against the abuse of drugs and other substances. The CSA places all substances, which were in some manner regulated under existing federal law, into one of five schedules. This placement is based upon the substance's medical use, potential for abuse, and safety or dependence liability. Schedule I and II drugs have a high potential for abuse. Schedule I drugs (like heroin, marijuana, or LSD) have no accepted safe medical use in treatment in the U.S. Schedule II drugs have an accepted medical use in treatment, oftentimes with severe restrictions. Abuse of the drugs can lead to severe psychological or physical dependence. Schedule III and IV medications have less potential for abuse and abuse of the drugs may lead to moderate or low physical dependence or high psychological dependence. For a more detailed explanation, visit

[2] The other bills introduced this session aimed at regulating prescription drug sales on the Internet are: H.R. 194, the Prescription Drug Affordability Act; H.R. 380 and S. 242, the Pharmaceutical Market Access & Drug Safety Act of 2007; S. 241, the Pharmaceutical Market Access Act of 2007; S. 554, the Pharmaceutical Market Access and Drug Safety Act of 2007; and S. 596, the Safe Internet Pharmacy Act of 2007. All of these bills are still in committee. Most of these bills are focused on ensuring that drugs purchased over the Internet are safe and, thus, offer amendments to the Federal Food, Drug and Cosmetic Act instead of the Controlled Substances Act.

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