Austin Pharmacy to Pay $200,000 in Civil Penalties for Alleged Violations of the Controlled Substances Act

AUSTIN, Texas – People’s Pharmacy Inc. has agreed to pay $200,000 in civil penalties to resolve allegations that it violated provisions of the Controlled Substances Act (CSA).

People’s Pharmacy Inc., doing business as Peoples Rx, operates five retail pharmacies and one compounding laboratory in the Austin area. During a routine inspection of a Peoples Rx location in June 2022, DEA diversion investigators determined that the pharmacy had violated certain regulatory recordkeeping provisions, improperly dispensed controlled substances to practitioners for office use, and issued prescriptions without authorization.

During their inspection, DEA diversion investigators also learned that Peoples Rx had sold pseudoephedrine products without self-certifying as required by the Combat Methamphetamine Epidemic Act of 2005 (CMEA). The CMEA regulates over-the-counter sales of ephedrine, pseudoephedrine, and phenylpropanolamine products, which are common ingredients in cough, cold, and allergy products that serve as precursor chemicals used in the illicit manufacture of methamphetamine or amphetamine.  Retail provisions of the CMEA include daily sales limits and 30-day purchase limits, placement of product out of direct customer access, sales logbooks, customer ID verification, employee training, and self-certification of regulated sellers.

The Diversion Control Unit in DEA’s San Antonio District Office led the investigation of this matter. The primary goal of the DEA’s diversion control program is to prevent, detect, and investigate the diversion of controlled substances from their lawful purpose into illicit drug traffic. In furtherance of this goal, DEA conducts inspections of pharmacies and other DEA registrants to ensure compliance with regulatory requirements relating to drug security and recordkeeping.

Assistant U.S. Attorney Thomas Parnham negotiated the settlement on behalf of the government.

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

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