Basic Principles of Pharmacy Law

1.1 The Foundations of Pharmacy Jurisprudence

Pharmacy law is a branch of healthcare law and public health law. It deals with matters related to the
regulation of drug distribution, the licensing of pharmacy personnel, and the permitting of community
and institutional practice sites at which pharmacists and support staff provide services and products for
use in clinical care. Pharmacy law covers subjects related to the treatment of individual patients, such
as patient education and drug therapy monitoring. Pharmacy law also covers subjects related to public
health, such as immunizations and addiction prevention.

Pharmacy law has its origins in pharmacy ethics. Although ethical standards are usually established by
the profession itself, legal standards are usually established by the government. There is considerable
overlap between ethics and law. The ethical principles of autonomy, beneficence, justice, and fidelity
are reflected in pharmacy laws. Autonomy reflects the idea that each individual patient must be
respected as a unique person who has a right to be treated in a manner that is consistent with that
person’s values and beliefs. For example, consistent with the ethical principle of autonomy, pharmacy
laws require that patients be told of a drug’s potential adverse effects that might alter the patient’s
decision about how or whether to use the drug. The ethical principle of beneficence coincides with legal
requirement for pharmacists to provide the best care possible for the good of each patient. Avoiding
harm to a patient is the goal of the correlative ethical principle of non-maleficence, and it is reflected in
virtually every pharmacy law. Justice is an ethical principle that requires fairness in dealing with
patients, supporting legal requirements that similarly situated patients be treated in a similar way. All
patients deserve the same quality products and services under the law, regardless of the source of
payment for those products or services. The ethical principle of fidelity refers to the importance of
keeping one’s promises, consistent with legal requirements related to the privacy of patient records and
the trust patients place in the judgment by a pharmacist to resolve potential problems with a patient’s
therapy prior to providing medication to the patient.

The significance of the ethical basis of pharmacy law, as a subset of healthcare law and public health
law, is that the focus of legal requirements for pharmacists is the best interests of patients and of the
public. Pharmacy laws are not always self-explanatory. They may require analysis and interpretation.
As professional people, pharmacists can provide clinical context when interpreting an ambiguous law.
When laws are unclear, as applied to a specific fact situation, the answer to a question related to legal
responsibilities can be successfully addressed by considering what is best for the patient and for the
public. One’s own self-interest, or the economic interest of one’s employer, are secondary to the
patient and public interests. Most questions that ask what must be done according to pharmacy laws,
can be effectively answered by asking what should be done to benefit the patient and the public.
Pharmacy laws have been enacted for the benefit of patients, thus adherence to clear legal
requirements generally meets the goal of patient-oriented practice.

Testing Tip: Focus on what is best for the patient if legal requirements are unclear.

1.2 The Origins of Pharmacy Law

The three traditional branches of government all have a role in making pharmacy laws. The legislative
branch enacts statutes that establish a broad framework for the governance of pharmacists, of

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pharmacy practice sites, and of the healthcare products that pharmacists use in their care of patients.
The executive branch promulgates regulations that amplify the statutory framework, by adopting
specific standards and recommendations for approaches to practice that will meet those standards. The
judicial branch serves as a body of review to assure that the legislative and executive branches have not
overstepped the authority granted to them under the law. Each of these branches of government is
subject to the principles outlined in the Constitution of the United States of America. Unconstitutional
action by the legislature, by an administrative agency, or by a court, will be considered unlawful and of
no legal effect.

At the federal level, the legislative branch is comprised of two chambers, the United States Senate and
the United States House of Representatives. Most of the people who serve in the Senate and the House
of Representatives are not career healthcare professionals. They are primarily politicians who create
broad policies intended to benefit the public they serve. They lack the expertise necessary to fine tune
the details of day-to-day regulatory requirements. A legislator, either individually or as part of a group
of legislators, introduces a bill that can become a statute only if a majority of both chambers votes in
favor of the bill. Some bills require more than a simple majority for passage. After passage by both
chambers, the President of the United States must sign the bill before it becomes a law. Examples of
key federal statutes are the Food, Drug and Cosmetic Act, the Controlled Substances Act, and the Social
Security Act. Statutes are dynamic statements of policy that can be amended as needed. The legislative
branch in each state functions in a similar way. The state Pharmacy Practice Act is an example of a state
statute. Operational details to implement a broad policy are usually not included in a statute. Those
details are established by the executive branch through its administrative agencies.

The executive branch of government is comprised of the chief executive (the President on the federal
level and the Governor on the state level), cabinet members who are either elected by the public or are
appointed by the chief executive, and administrative agencies that are staffed both by career
government professionals and by political appointees. An administrative agency provides a level of
expertise that is generally not available in the legislative branch. For example, the “nuts and bolts” of
how to regulate pharmacy are determined through the promulgation of regulations by a state
administrative agency that is generally called the “Board of Pharmacy.” The majority of board members
are experienced pharmacists who know how pharmacy is practiced and what can be done to enhance
public health protection through regulatory requirements in the best interests of the public. Most
boards of pharmacy also have several “public members” who have no connection with pharmacy or the
pharmaceutical industry. Their responsibility is to assure that the public interest is being considered by
the board. Pursuant to the authority granted to them through the legislation that has created and
empowered them, administrative agencies such as a board of pharmacy specify how a statutory policy is
to be carried out. Boards of pharmacy cannot make policy that differs from the policy expressed by the
legislature in the pharmacy practice act, but boards of pharmacy have significant influence in
determining how statutory policy is to be implemented through their familiarity with the “ins and outs”
of everyday pharmacy practice.

The judicial branch is comprised of the court system at both the federal and state level. Judges preside
over cases brought by one party against another party. Within a clearly outlined set of procedural rules,
controversies brought to the courts are addressed and adjudicated. If a party to a lawsuit is not satisfied
with the outcome at a lower court, then that party can appeal to a higher court and request complete
reversal or modification of the lower court’s ruling. Some issues brought before courts are original

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issues that have not previously been litigated. For example, a pharmacist malpractice case or a case
alleging employment discrimination in a pharmacy workplace. Other issues brought to court are
requests for review of an action taken by the legislative or executive branch, such as a statute that is
alleged to be unconstitutional or a regulation that is alleged to exceed the scope of the administrative
agency’s statutory authority.

The answers to most questions about pharmacy law can be found in statutes, regulations, and court
cases. The source of pharmacy law must be considered in determining what legal requirements are to
be met in pharmacy practice. Referring to one source, and ignoring other sources, raises the possibility
that something important has been missed.

Testing Tip: Consider all relevant legal principles in statutes, regulations, and court cases when
determining the legal requirements applicable to a pharmacy question.

1.2.1 The Extensive Role of the Administrative Agency

The federal administrative agencies most relevant to pharmacy practice are the Food and Drug
Administration (FDA), the Drug Enforcement Administration (DEA), and the Centers for Medicare and
Medicaid Services (CMS). The state administrative agencies most relevant to pharmacy practice are the
State Board of Pharmacy (or an equivalent state-level agency), and the State Department of Health.
These administrative agencies function in expansive ways that one might not necessarily expect, given
the traditional separation of powers represented by the legislative-executive-judicial framework of legal
authority. Administrative agencies have the authority to create laws through the promulgation of
regulations, they investigate potential violations of the law, they adjudicate controversies related to
alleged legal violations, and they implement punishment when they conclude that a law has been
broken.

The process through which administrative agencies actually make laws is often referred to as “notice
and comment rulemaking.” Pursuant to this process, the administrative agency publishes a notice of
proposed rulemaking that includes justification for the proposed rule and the language of the proposed
rule. Immediately following the notice, comments from any member of the public are welcome. The
comments are considered and the proposed rule may be modified by the agency based on the
information contained within the comments. A final regulation is eventually published, with an
implementation date. The purpose of this approach is to assure that all perspectives have been
considered prior to the implementation of a new regulation, and to give the regulated industry or
profession, as well as the public being served, an opportunity to make modifications as needed to
comply with the new regulation.

The enforcement activity of an administrative agency usually relies both on reports from periodic
inspections and on responses to complaints that may be directed by a citizen to the agency. There is
usually an element of education that precedes enforcement, when noncompliance with regulations
appears to be the result of a knowledge deficit rather than intentional resistance to a known legal
requirement. Some administrative agencies issue guidance documents or other informal advisory
directives to clarify what is required of regulated entities under laws enforced by the agency. There is a
general feeling among regulatory agencies that voluntary compliance by the regulated profession is the
most successful approach to regulation.

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Those who are alleged to have violated a law that an administrative agency is authorized to enforce may
be subject to a trial-like hearing that is conducted to determine the underlying facts of the case and to
apply appropriate laws to the facts. An administrative discipline case begins much the way a court case
begins, with the alleged violator being told what laws have allegedly been violated. A government
lawyer represents the administrative agency and the alleged violator must engage a private attorney if
legal representation is perceived to be necessary. The alleged violator may decide not to contest the
allegations and to pay whatever penalty the administrative agency determines is appropriate. There is
often an opportunity for negotiation of a penalty (similar to plea bargaining under criminal law), if the
alleged violator is willing to admit the violation in exchange for a lighter penalty. The alleged violator
may instead contest the allegations, which will usually result in a hearing before an administrative law
judge. The judge will listen to witnesses, examine documents, and make conclusions of law. The
administrative law judge will usually make findings of fact and issue a recommendation. The
administrative agency must accept the facts as the judge has determined them based on the evidence,
and must accept the law as applied to the facts by the judge, but the agency may either accept or reject
the recommendation.

The role of the administrative agency is multi-faceted. Administrative agencies function as lawmakers,
investigators, prosecutors, fact-finders, and disciplinarians. The determinations of an administrative
agency are reviewable by a court of law, which may reverse the agency if the requisite procedures have
not been followed, or if the agency has engaged in arbitrary and capricious actions.

Testing Tip: The openness of the process used by administrative agencies determines the legitimacy of
an agency action.

1.2.2 Court-Made Law

Litigation is a process through which existing laws are applied to the facts of a case, and new legal
requirements are established through judicial interpretation of the law as applied to the facts. Most
legal cases begin at the trial court level. Trial judges oversee a period of discovery during which
depositions are taken of witnesses and documents are produced by each litigant, to avoid unfair
surprises at trial. Television shows with surprise witnesses and newly-discovered facts are based on a
myth. In real life, there are very few surprises. The litigants and their attorneys have established a clear
mutual understanding of the alleged facts and the alleged legal violations prior to trial. All that remains
is for a jury to consider the significance and credibility of the facts as alleged, and to apply the law to
those facts under the judge’s supervision.

There are several opportunities during the evolution of a case for a judge to rule that the case need not
proceed. A motion to dismiss may be asserted early in the case if the lawsuit is clearly groundless. For
example the plaintiff may have mistakenly named the wrong defendant. Or, if the statute of limitations
has clearly expired. There is no point in continuing with a case that is certain to fail, and the judge can
put an immediate end to a pointless proceeding. After the period of discovery has finished, a motion for
summary judgment may be made. A judge may grant such a motion if the facts, as developed by the
discovery period, show that there is no basis for a lawsuit. For example, a patient may allege that the
warnings provided by a pharmacist were inadequate when a drug was dispensed to the patient, yet the
evidence may show that the patient was given ample information about the drug’s adverse effects. The
lawsuit will likely be dismissed. There is no need for a trial.

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After a jury verdict, either party may choose to appeal. Courts of appeal do not reconsider the facts.
They base their deliberations on the already established factual record from the trial court. Instead,
they consider whether the application of the law to fact was done consistent with prior legal
precedents, and/or in accord with applicable statutes and regulations. This is the point when legal
precedent is most often established by the appellate court, through interpretation of the law and the
application of the law to the proven facts.

Appellate courts can make law through interpretation and a published legal opinion. They can, for
example, define the pharmacist’s role in compounding, establish the parameters of required technician
supervision, determine the circumstances under which pharmacist have a duty to consult with a
prescriber regarding a potential problem with a prescription, or clarify any one of a number of other
pharmacist responsibilities that may be ambiguous within statutes and regulations. When they do this,
appellate courts write and publish legal opinions that explain the rationale underlying the result. In this
way, the courts actually create previously unrecognized legal requirements of general applicability, by
resolving real disputes between parties.

Some judges are more “activist” than others. This means that they are more likely to depart from prior
precedent than are the more cautious judges. Legal principles can be applied in different ways
depending on whether the facts of the case are compelling to the judge. Although the purpose of
litigation is to address an individual disagreement between litigants, the principles applied by a court
can have broad policy implications for many people who were not involved in the lawsuit.

Testing Tip: Look to legal cases for clarification of indefinite or confusing statutes and regulations.

1.2.3 Types of Pharmacy Law

A single act by a health professional who harms a patient through that act, may expose the health
professional to any of three types of legal consequences. There is potential exposure to all three types
of violations. Take for example an error by a pharmacist who labels a methotrexate prescription to be
taken once daily rather than once weekly as it was prescribed. Unfortunately, as a result of this error,
the patient dies from methotrexate toxicity. The pharmacist may be sued for civil liability by the
survivors of the patient, and also prosecuted for criminal liability by the local prosecutor, as well as
being subject to discipline by the state licensing agency for violation of pharmacy professional
standards. This is not considered double jeopardy, because civil liability law, criminal law, and
administrative law are three different types of law and each serves a distinct purpose.

The purpose of civil liability law is to provide corrective justice to a person, or to that person’s survivors,
for harm done to the person by a health professional whose conduct fell below the applicable standard
of care resulting in negligent professional practice. An inadvertent error may serve as the basis of civil
liability. There need be no proof of malice or intent to harm. The result of a civil liability verdict against
the health professional will be an award of money damages that roughly correspond to the magnitude
of the harm that was caused. Of course, money damages can’t replace a life or take away serious harm,
but they can serve as a substitute to compensate for a loss of life or for a loss of health. Civil liability
provides a mechanism for two independent citizens to resolve their dispute in a just and systematic
forum. To prevail in a civil liability case, the plaintiff must prove that the defendant health professional
owed a duty of care, breached the duty of care, and that the breach caused harm to the plaintiff. If any
of these elements is missing, then there will not be liability for professional malpractice.

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Criminal law metes out punishment to those whose conduct intentionally caused harm to another
person or to those who acted with such malice aforethought that harm to another person was inevitable
even if it was not intended. Conduct of this type is a crime against the state, and the victim is not only
the person who was harmed (or could have been harmed) but also the public who have a right to live in
a society where people do not cause intentional harm to others. In the hypothetical example of the
pharmacist who mislabeled the methotrexate prescription, criminal liability would require evidence that
the pharmacist acted with intent to harm the patient, or that the pharmacist exhibited malicious
indifference to the consequences of her or his actions or inactions. For example, if the evidence were to
show that the pharmacist intentionally refused to supervise pharmacy technicians, allowing them to
check themselves rather than requiring a pharmacist final check of prescriptions, then the facts could
support criminal liability. Fines and/or incarceration are the penalties that can be assessed when a
crime has occurred.

Administrative law can be both punitive and corrective. A licensing agency has the authority to respond
to the actions of a health professional whose practices pose a threat to the public health.
Administrative agencies have traditionally imposed backward-looking penalties in reaction to a violation.
Agencies have increasingly become more proactive through the imposition of forward-looking remedial
measures. A health professional who has consistently failed inspections, and/or who has consistently
exercised poor practice judgment, resulting in numerous complaints to the agency, may very well be
assessed a financial penalty and perhaps a license suspension or revocation. Yet many health care
licensing agencies have now adopted a systems approach to quality improvement, and they are more
likely to require the implementation of systems assessment programs in the future to prevent harm to
the public from dangerous health care practices. A licensee who refuses to implement such programs
may be subject to punishment, while a licensee who willingly makes necessary practice changes in the
public interest will not be punished, even if both have committed the same violation.

Testing Tip: A pharmacist whose actions cause harm to a patient may be exposed to civil liability and
criminal liability and administrative liability.

1.3 State versus Federal Regulatory Authority

We all understand that every state is a part of the United States of America. What is less obvious is that
sometimes federal and state laws conflict, and pharmacists may face a choice of which law to follow.
The complex relationship between federal and state laws is based on the concept of “federalism” as
developed in the United States Constitution by its framers who reasoned that the best result for the
people being governed would be shared responsibility between the national government and the state
governments. While the term “federalism” might be interpreted as referring to consolidated
governmental power within a central federal authority, the irony of the term is that it actually refers to
dual governance, through a mutual relationship between national and the state governments.

Under the Constitution, the federal government is given what is referred to as “express powers.” These
include the right to regulate foreign commerce, and to regulate interstate commerce. This part of the
Constitution is generally referred to as the “Commerce Clause.” The concept of “interstate commerce”
has broadened over the years, to the point that it now includes virtually all forms of commerce. Under
the Constitution’s “Necessary and Proper” clause, the federal government is allowed to regulate in any
way it needs to execute its express powers. The states are constitutionally granted what is known as
“reserved powers,” which includes the power to protect the health and welfare of their citizens.

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Testing Tip: The concept of interstate commerce is very broad, and all activities that are in interstate
commerce are subject to federal regulation.

1.3.1 Regulation of Drug Products and Regulation of Professional Practices

Pharmacy has often time been referred to as “the most highly regulated health profession.” This
reference is accurate. Pharmacists are subject to laws of many different kinds. Pharmacists must
adhere to federal regulations related to the safety and efficacy of the drug product. These matters are
regulated by the FDA, which shares authority with the DEA for the regulation of those drugs that have a
potential for abuse. State licensing agency laws related to the structure and processes of a pharmacy
practice site must be followed by pharmacists, and the same is true of laws related to the capabilities
and activities of personnel authorized to practice as pharmacists and as pharmacy technicians. The
board of pharmacy established and enforces these regulations. Lastly, pharmacists must adhere
regulations related to the costs of pharmaceuticals paid for by various government programs. CMS is
the regulatory agency involved with this area of regulation. It seems like everyone wants a piece of
pharmacy regulation, because the products, the places, and the persons of pharmacy, are all subject to
regulation.

As a general rule of law, the federal government, through its federal agencies, has primary authority to
regulate a drug product and payment for that product under federally sponsored programs, while state
governments, through their boards of pharmacy, have primary authority to regulate the places where
the profession of pharmacy is practiced and the persons who practice the profession of pharmacy in
those places. There is significant overlap between the regulation of the drug product and the regulation
of pharmacy practice. Since pharmacists are the people who order the drug product from a distributor,
receive the drug product when it is delivered, and distribute the drug product to patients for their
therapeutic use, it is pharmacists who must assure adherence to regulations covering the drug product.
Nobody else is as close to the drug and the patient as the pharmacist. The pharmacist serves as the last
link in a long chain of drug production and distribution. The pharmacist is ideally placed to discover
whether a drug product is adulterated or misbranded or is otherwise in violation of federal law.
Pharmacists are positioned as a safety net to promote safe and effective drug therapy, consistent with
federal drug laws.

States generally do not regulated the product itself. Rather, they regulate the specific practices of
pharmacists who dispense the drug product and who monitor the use of the drug product. State
regulations are designed to assure that safe and effective drug products are used safely and effectively,
assuring that physicians have not ordered drugs that interact with each other, and that patients have
been appropriately educated about how a drug is to be used to maximize therapeutic benefits and
minimize adverse effects. The use of the drug product is generally regulated under state law, and not
the development, formulation, or manufacture of the drug product, which is within the authority of
federal regulators. Pharmacists cannot assume that following state laws governing pharmacy practice is
sufficient. It is also required that pharmacists know and obey federal laws related to the drug product.

Federal and state regulators often work together. A potential violation of state law may come to the
attention of federal regulators, and they will refer this potential violation to their colleagues with the
state government. State regulators reciprocate the favor with federal authorities. In some states, the
board of pharmacy is authorized to impose discipline on pharmacists or pharmacies for violation of both
state and federal law. It is unlikely, given the close working relationship between state and federal

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regulators, that misconduct by a pharmacist will be overlooked simply because the regulator who
identifies the misconduct lacks specific jurisdiction over the matter.

Testing Tip: Pharmacists must adhere to both state regulation of professional practice and federal
regulation of the drug product.

1.3.2 Federal Conditions of Participation

Many of the medications that pharmacists dispense are paid for under federally funded program such as
Medicare, Medicaid, or Tricare. These federal programs are technically voluntary for pharmacies. There
is no requirement that a pharmacy participate in any of these programs. But a pharmacy that opts to
participate must follow the rules of the program, which are generally referred to as “conditions of
participation.” Regulatory matters that are generally covered under state law, such as generic
substitution and patient education, may be addressed in the conditions of participation established by a
federally funded program. If this is the case, then the pharmacist who opts to participate in a federally
funded program must follow the rules of the program as well as state laws. Of course, pharmacies are
always able to opt out of a federal program if they wish, although this approach may result in significant
lost revenue. Patients who object to rules established by conditions of participation are free to self-pay
for their medication and avoid the rules, though this option is rarely exercised.

Some federal programs are administered by third-party programs such as insurance companies. The
pharmaceutical component of these third-party programs is often run by a prescription benefit
management company (PBM). The rules established by PBMs may differ from rules established under
state laws. A PBM may limit pharmacy technician functions to a greater degree than is done under state
law. Or, a PBM may require that refills be handled in a way that is not required under state law.
Pharmacists must assure themselves that the practices they adopt in filling prescriptions covered by a
PBM are consistent with state laws. If a pharmacist chooses to follow a state law, and not follow a
provision contractually established by a PBM that is managing a federal program, the pharmacist’s
decision may result in the filing of a false claim, which exposes the pharmacist to punishment under
federal law.

Testing Tip: Opting to participate in a federally funded prescription drug program subjects a pharmacy
to regulatory liability for failure to comply with the federal program’s conditions of participation.

1.3.3 Federal Supremacy

According to what is known as the “preemption doctrine,” federal law always takes priority over state
law when there is a direct conflict between state law and federal law, making it impossible to comply
with one law without breaking the other law. It is rare for such a direct conflict to arise. A direct conflict
exists only when a pharmacist has no choice but to violate either federal or state law, because both legal
authorities require action that the other forbids.

One example of federal preemption can arise in state lawsuits that are filed against a generic
pharmaceutical manufacturer whose drug package insert allegedly fails to warn of an adverse effect that
a patient contends should have been warned of. This is the type of product liability lawsuit that relies
on state law, because it is based on the law of torts. Most courts have recognized that a generic
manufacturer is required by federal law to include in its package insert the exact same information as is
contained within the package insert for the reference listed brand-name drug. It would violate federal

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law for the generic manufacturer to include additional information. A state lawsuit may not require that
a generic manufacturer violate federal law. If a state court were to conclude that a generic
manufacturer should be held liable for failing to include a warning that is missing from the brand-name
drug package insert, then that state court ruling would violate the preemption doctrine. Federal law is
supreme.

As a practical matter, the best practice in pharmacy is to follow whichever law, federal or state, is
stricter. For example, federal law allows emergency dispensing of a Schedule II prescription subject to
some conditions, but a state may refuse to allow that practice. In this circumstance, a pharmacist can
adhere to the stricter state requirement without violating federal law. No other choice need be made.
The pharmacist can comply with both federal and state laws. The limits of federal supremacy are
currently being challenged by states that have authorized certain conduct that is forbidden by federal
law. This includes the distribution of medical marijuana, the re-importation of pharmaceutical products
for resale, and extemporaneous compounding of medications for physician office use.

Testing Tip: When state and federal laws conflict, comply with the stricter of the two laws.

1.4 Case Studies in the Foundations of Pharmacy Law

Legal principles are more easily understood within the context of actual lawsuits that have been
resolved in court. What follows are summaries of real legal cases, including the outcomes of the cases.
The facts and rationale have been simplified for educational purposes.

1.4.1 The Patient’s Best Interests

A pharmacist left his pharmacy with no pharmacist on duty. A pharmacy technician remained on duty to
tell patients that the pharmacy department was closed due to there being no pharmacist present. A
patient came to the pharmacy and insisted that she needed a prescription filled. The technician called
the pharmacist who instructed the technician to fill the prescription “for the benefit of the patient.” The
board of pharmacy disciplined the pharmacist for violating the law. The pharmacist argued that he was
doing what was best for the patient and that he should not be punished for this benevolent action. In
reviewing this board disciplinary action, the court determined that the best interest of the patient would
have been for the pharmacist to follow the law. When a law is subject to interpretation, doing what is
best for the patient makes good sense. When a legal requirement is clear, however, violating the law is
not in the patient’s interest.

1.4.2 Specificity in Regulations

A pharmacy developed a procedure for central filling of prescriptions, in which the pharmacy would
transmit orders to the central fill facility and the facility would deliver the processed prescriptions the
next day. The pharmacy’s pharmacist-in-charge reviewed the statute that authorized the central fill
process and she based the pharmacy’s policy on the information within the statute. Unfortunately, the
pharmacist-in-charge did not refer to the administrative regulations promulgated by the board of
pharmacy, and the procedure adopted by the pharmacy failed to comply with those requirements. The
board of pharmacy disciplined the pharmacy for lack of compliance with the regulations.

1.4.3 Following Administrative Procedures

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A pharmacist was charged by the board of pharmacy with recordkeeping violations. An administrative
hearing officer concluded that the recordkeeping violations had occurred, and the hearing officer
recommended a one-year license probation. The board of pharmacy met to consider the
recommendation and several members of the board voiced concerns about what might have happened
(dispensing errors, fraudulent controlled substance prescriptions) that could not be ruled out due to the
absence of accurate records. The pharmacist’s license was suspended based on this speculation. The
court reversed the board of pharmacy’s action. Administrative discipline must be based on fact, and not
on rumor and innuendo.

1.4.4 Triple Jeopardy

A pharmacist was found to have intentionally diluted chemotherapy drugs to increase his profits.
Cancer patients received sub-therapeutic medications due to this malfeasance. Pharmacy records
showed that far more chemotherapy had been dispensed for patient care than had been received from
the manufacturer, thus proving the illegal dilution. The pharmacist was criminally convicted and
imprisoned. His pharmacy license was revoked. He was successfully sued for malpractice.

1.4.5 Rx Only

A pharmacist received a stock bottle of medication from a wholesaler within the pharmacist’s state. The
label on the stock bottle bore the federal legend, “RxOnly.” The pharmacist dispensed a refill of the
medication pursuant to a prescription from a physician within the state, although the prescription did
not allow for refills. Federal regulators contended that federal law had been violated because the
pharmacist’s actions were in interstate commerce. The court applied a broad interpretation of
interstate commerce, ruling that the pharmacist had violated federal law by dispensing a prescription-
only medication without authority of a licensed prescriber. It is established law that intrastate
dispensing activities are considered to be within interstate commerce.

1.4.6 Choice of Law

The FDA approved a new opioid medication as a Schedule II controlled substance. A state disagreed
with this approval and classified the medication as Schedule I, meaning that it was unavailable for
patient care in that state. The court applied the federal preemption rationale and disallowed the state’s
classification of the product as Schedule I. The court said that a state has authority to restrict the
conditions of use for an FDA-approved medication, but cannot forbid the use of the medication, as this
would amount to outright disapproval of the drug. New drug approval is within the regulatory auspices
of the federal government and not the state.

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