Former Rochester Drug Co-Operative CEO Laurence Doud III, right, leaving U.S. District Court in Manhattan with his attorney Robert C. Gottlieb, center, on April 23, 2019.
Photo: Kathy Willens (AP)

Federal prosecutors have filed criminal charges against drug distributor Rochester Drug Cooperative (RDC) and two of its former executives, operations manager William Pietruszewski and CEO Laurence F. Doud III, in what the Washington Post reported is the first time the feds have targeted legal painkiller wholesalers for contributing to the opioid epidemic.

Prosecutors allege the executives shipped tens of millions of oxycodone pills, as well as other drugs like the powerful synthetic opioid fentanyl, to pharmacies that they knew were not distributing them legally from 2012-2017. Historically, authorities have used civil penalties rather than the criminal justice system to go after distribution companies that fill suspicious orders of drugs. But as the New York Times notes, the felony drug trafficking charges the two men are facing are essentially the same as ones the feds might bring against operators of a wholly illicit drug cartel.

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RDC is the sixth largest pharmaceutical distributor in the U.S. and distributes to hundreds of pharmacies across much of the Northeast, Reuters wrote.

According to the Times, the charges against the RDC as a corporate entity are “conspiring to distribute drugs, conspiracy to defraud the United States, and failing to file suspicious order reports.” While prosecutors did strike an agreement to avoid prosecution that requires RDC pay a $20 million fine, agree to five years of supervision by an independent monitor, and otherwise comply with controlled substances laws, the Times wrote, the company did have to admit that it intentionally broke federal drug laws.

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Doud and Pietruszewski are both being personally charged with the two counts of conspiracy to distribute drugs and conspiracy to defraud the government, while Pietruszewski is also facing the additional charge regarding suspicious order reports.

Pietruszewski has pleaded guilty and will cooperate with the feds, the Post wrote.

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Doud, who is retired and is contesting the charges, will be in court Thursday; the indictment alleges that as Doud looked the other way, the RDC reported just four of 3,000 suspicious orders for oxycodone and fentanyl to the Drug Enforcement Agency. Prosecutors added that shipments to one pharmacy reported to be RDC’s best customer “grew exponentially” as Doud raked in bonus pay, according to the Post, while at another pharmacy over 60 percent of customers (almost all of whom were out-of-state) paid in cash.

Doud’s lawyer, Robert C. Gottlieb, told the Times that “Mr. Doud is being framed by others to cover up their wrongdoing. The government has it all wrong. He will fight these charges to his last breath and he will be vindicated.”

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The Centers for Disease Control estimates that roughly 218,000 people died from “overdoses related to prescription opioids” from 1999 to 2017, with that death rate five times higher in 2017 than 1999. One study in the American Journal of Public Health last year estimated that the tally of all opioid-related deaths over the next decade could reach 510,000. As Wired noted, some researchers believe pharmaceutical companies have contributed immensely to the epidemic because more powerful (and thus potentially more harmful) synthetic versions of opioids, like fentanyl, are easier to traffic without attracting the attention of authorities and thus have proliferated.

U.S. attorney for the Southern District of New York Geoffrey Berman said in a statement that “today’s charges should send shock waves throughout the pharmaceutical industry reminding them of their role as gatekeepers of prescription medication.”

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Both executives could face maximum sentences of life in prison and a mandatory minimum sentence of 10 years on the drug trafficking charges, per NPR, as well as a maximum five years on charges of defrauding the government.

Hundreds of lawsuits against pharmaceutical companies involved in opioid manufacturing or distribution are pending. Purdue Pharma, the maker of OxyContin, recently settled a lawsuit that claimed it aggressively marketed the drug while downplaying the risks to the tune of $270 million, and has been reported to be flirting with bankruptcy. There are currently more than 1,600 opioid-related suits pending against pharmaceutical companies in state and federal courts, according to Stat News, with some proceeding independently in state court but most consolidated into a single, massive federal case in Ohio.

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[Washington Post]