Overview of Suspicious Order Monitoring
The Controlled Substance Act (CSA), as noted below, requires manufacturers and distributors of controlled substances (sometimes referred to as Registrants) to maintain effective controls against diversion of controlled substances outside of legitimate medical, scientific, and industrial channels. Purdue takes seriously its commitments under these regulations and believes that a robust program of controlled substance ordering analysis, knowing your customer, and knowing your customer’s customer, due diligence, data analysis, and downstream customer reviews will assist in preventing diversion.
21 CFR 1301.74(b)
The registrant shall design and operate a system to disclose to the registrant suspicious orders of controlled substances. The registrant shall inform the Field Division Office of the Administration in his area of suspicious orders when discovered by the registrant. Suspicious orders include orders of unusual size, orders deviating substantially from a normal pattern, and orders of unusual frequency.
Purdue Pharma L.P. Suspicious Order Monitoring Program
Purdue Pharma L.P. and its subsidiaries (the Company) operate a Suspicious Order Monitoring (SOM) program that is ever evolving and continuously improving. The program is designed to comply with the CSA and the Drug Enforcement Administration (DEA) guidelines.
Relying on tools provided by an industry-leading third-party vendor, the Company’s dedicated SOM team analyzes customer orders for controlled substances manufactured by the Company. Vendor tools provide insight into customer orders based on a refined and targeted algorithm that is adjusted regularly. Deployment of this algorithm against all data in the Company’s possession regarding customer orders for controlled substances allows for a determination of orders that may be of unusual size, pattern, or frequency. When identified, such orders are pended (held) for further investigation. Pended orders are analyzed by the SOM team to determine if an order should be cleared and fulfilled or rejected. Based on guidelines made under our Voluntary Injunction, all orders that pend are considered “suspicious orders” and thus are reported to the DEA. If, after analysis, there is sufficient cause to allow release of an order, it may be fulfilled. If not, the order is flagged to the DEA as a rejected order.
Know Your Customer
The DEA expects drug manufacturers and wholesalers to “know your customer.” For a pharmaceutical manufacturer, a customer is typically a wholesaler/distributor (a Customer).
How the Company complies with the guideline to know our Customers: The SOM Team is in regular communication with all of our Customers. As part of our communications, annual due diligence questionnaires are required from all Customers that purchase controlled substances. In addition, we require Customers to submit copies of their licenses and provide an overview of their SOM system or controlled substance due diligence program. Finally, we conduct periodic Customer site visits. We conduct in-person site visits with all Customers on a 3-year rotational basis but, consistent with DEA guidance, will consider virtual site visits if COVID prevents in-person interactions. Site visits are a great opportunity for us to get to know our Customers in their environment.
Know Your Customer’s Customer
The DEA’s guidance states that pharmaceutical manufacturers need to go beyond “know your customer” requirements and use available data within the Company to “know your customer’s customer.” These suggestions were created to assist pharmaceutical companies in preventing drug diversion.
The SOM team complies with these requirements by working with our direct Customers, as well as others, to learn about their customers (e.g., retail pharmacies, hospitals, and other healthcare facilities). Customers who purchase directly from our Customers are known as Downstream Customers. The SOM team works with our Customers to gain a better understanding of the Downstream Customer’s purchasing history by analyzing several data sets provided by our Customers.
The SOM team utilizes a proprietary third-party, vendor-based system to assist with the analysis of these data, relying on statistical analyses to provide further insight into Downstream Customer activity. If an outlier is identified, a due diligence review process is completed on the Downstream Customer. This may include DEA registration verification, review of disciplinary history, and many other factors. Such Downstream Customer outliers are reported to both the respective Customer as well as to the DEA. The analysis of the data sets, outlier identification, and due diligence review provides insight into the Downstream Customer environment and furthers our compliance with DEA’s “know your customer’s customer” guidance.
Reporting to DEA
As required by the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act (the SUPPORT Act), reports are made weekly to DEA’s Suspicious Orders Report System (SORS). Reports include all orders that system pended for further analysis in the full prior calendar week. Orders that have pended and cannot be resolved are then rejected and reported to DEA. In addition, all Downstream Customer outliers are reported to the wholesaler/distributor and to the DEA via an online portal.