The concept of “know your customer” (KYC) is fundamental to successful prevention of diversion. And while it may seem simple in concept, there are aspects to this practice you may have never considered.
Officially, KYC regulations are in place for DEA registrants who manufacture, distribute, or handle controlled substances and listed chemicals – specifically:
Manufacturers that produce controlled substances or regulated chemicals.
Distributors who sell and ship controlled substances to buyers like pharmacies or clinics.
Importers and Exporters moving regulated substances across borders.
Businesses dealing with list I and II chemicals
Distributors are on the hot seat due to past DEA cases that cost them millions of dollars in fines and strict conditions for how they do business as a result of a lack of due diligence during the opioid crisis. So, if distributors are on the hot seat, pharmacies will feel the heat as well. Distributors are focusing more than ever before on the customers being served by the pharmacies who are purchasing controlled substancesand other drugs from them. For any pharmacy in operation today, KYC is essential not only for preventing drug diversion but, more importantly, as a way of protecting your business from being cut off by drug distributors.
Who are the practitioners for whom you are filling prescriptions?
Who are the patients obtaining those prescriptions.
Remember that the distributors have access to all types of datasets from multiple sources that allow them to research your activities, who you are serving, and who your customers are. The data available to the distributors lets them build profiles of the prescribers who are in your customer base, as well as the receiving the prescriptions. The distributors can use all of this data to determine your pharmacy’s level of risk for possible diversion or fraud, and then use it as a reason to cut off your pharmacy as a customer.
You should have a good idea of the prescribers who are in your area. Over time, you’ve seen their prescriptions come in – both the “good” ones and the “not-so-good” ones that make you pause before filling. You’ve talked to other pharmacists in your area and heard the rumors and gossip about certain prescribers.
Maybe there have been official warnings issued about certain prescribers, or perhaps you’ve heard about the state medical board or state veterinary boards acting against certain practitioners. Wherever you get your information about your prescribers, you should be building up your knowledge of them, their patient loads, and their prescribing patterns.
If you’re not sure if they are practicing legitimately, don’t ever forget that you’re within your rights to ask questions regarding their prescriptions. While the practitioner has the authority to issue the prescription for controlled substances, the authority to fill that prescription rests with the pharmacist. This is your corresponding responsibility. If you knowingly fill a questionable prescription or a fraudulent prescription, you can be held equally liable for this action as the practitioner.
What if you have a prescriber, for example, work works at a pain management practice and he or she prescribes large amounts of opioids? If you can explain and justify why you fill those prescriptions, then do so. Keep diagnostic notes, call logs and copies of the prescriptions. Whatever system you want to use, have evidence about those prescribers and those prescriptions in case a distributor has concerns.
But also, be on the lookout for deviations by these types of high-risk practitioners. For example, if you have a palliative care practitioner who typically works with 70- and 80-year-olds and he suddenly starts writing prescriptions for 20-year-olds, you may want to ask some questions—especially if there are other red flags such as cash payments, unusual fill patterns, early fills, and other classic signs of pharmaceutical diversion.
Just as you filled out a "Know Your Customer" (KYC) set of documentation when you opened your account with a distributor, you may want to keep similar types of documentation on the prescribers in your area and keep those files updated. You don’t need a long, detailed, multi-page file; it can simply be a series of organized notes that you keep, refer to, and update.
Train your staff to ask questions and how to spot the red flags of drug diversion. If they receive a prescription that seems suspicious, teach them to flag it so you can contact the prescriber to ask more questions.
Don’t delay a removal. You should be able to see over time which prescribers are too high risk. Similarly, you can spot the patients filling questionable prescriptions. In both cases, you need to remove them from your customer base immediately. Delaying for extended periods of time or making excuses for these people does nothing to benefit you. When distributors ask why you failed to remove these bad actors, the responsibility will rest solely on you. Your hesitation to act could lead your business being cut off.
Keep your emotions and profit drive in check. If you have suspicions and questions about a customer that you cannot resolve, you need to make a rational business decision to cut those customers off. Don't let your emotions and your desire to make a profit interfere with your good judgment. What will you say to your distributor (or even worse, a DEA investigator if they knock on your door) when they ask about your failure to act?
If you’re not sure how to analyze your customer base, or if you think there may be problems lurking among your prescribers and patients, help is a phone call away.
TITAN Group — the nationally-recognized DEA compliance consultancy skilled in pharmacy issues — and its partner, SageComply have a suite of tools that allow quick, deep, and accurate problem spotting. Using SageComply’s proprietary analysis systems, TITAN Group can quickly identify, document, and pinpoint your problem practitioners and patients. Titan will craft a strategy to remediate the problems they may be creating for you.
TITAN Group has worked with pharmacies across the country that have lost their distributor relationships in order to help them restore those vital accounts. TITAN has learned how these distributors think and what they’re looking for when they come to your pharmacy and begin asking questions. The most powerful step: be knowledgeable and be prepared.
Find out more about how to tap into TITAN's expertise and put powerful SageComply tools to work for you.