chevron-down Created with Sketch Beta.
January 02, 2018 Practice Points

Department of Justice Announces New Opioid Fraud and Abuse Detection Unit

The formation of this new program comes amid increasingly strenuous calls from all corners regarding the need to target opioid fraud and address prescription drug abuse.

By Wick Sollers and Dan Sale – January 2, 2018

In August 2017, Attorney General Jeff Sessions announced the formation of the Opioid Fraud and Abuse Detection Unit, a pilot program intended to investigate and prosecute those individuals and businesses contributing to the nation’s opioid epidemic.

The formation of this new program comes amid increasingly strenuous calls from all corners regarding the need to target opioid fraud and address prescription drug abuse. According to the latest data from the Centers for Disease Control and Prevention (CDC), more than 33,000 Americans died (or 91 every day) from an opioid-related overdose in 2015, and opioids are involved in over 60 percent of all overdose deaths. Moreover, the Department of Health and Human Services Office of the Inspector General (HHS-OIG) has reported that the Medicare Part D program paid almost $4.1 billion for 79.4 million opioid prescriptions in 2016, and has expressed concerns that many Medicare beneficiaries are at serious risk of opioid misuse or overdose because they either received an extreme amount of opioids or appeared to be “doctor shopping.”

The Opioid Fraud and Abuse Detection Unit will fund the work of 12 Assistant United States Attorneys who will work full time on cases against individuals and entities that Sessions described as “contributing to this prescription opioid epidemic.” The new unit will also employ a data-analytics team that will identify: physicians “writing opioid prescriptions at a rate that far exceeds their peers”; the average age of patients receiving opioid prescriptions; how many of a doctor’s patients have died within 60 days of an opioid prescription; pharmacies dispensing disproportionately large amounts of opioids; and regional “hot spots” for opioid abuse. In his speech announcing the new program, Sessions stated

With these new resources, we will be better positioned to identify, prosecute and convict some of the individuals contributing to these tens of thousands of deaths a year . . . The Department is determined to attack this opioid epidemic, and I believe these resources will make a difference. . . . If you are a doctor illegally prescribing opioids for profit or a pharmacist letting these pills walk out the door and onto our streets under false pretenses, we are coming after you. . . . We will reverse these devastating trends with every tool we have.

The formation of this new unit is the latest step in the government’s increased enforcement efforts related to the opioid epidemic. In July, the Department of Justice (DOJ) announced a $35 million settlement with Mallinckrodt LLC over alleged failures to report suspicious oxycodone orders. Similarly, in the final months of the Obama administration, the DOJ settled with McKesson Corp. for $150 million and with Cardinal Health Inc. for $44 million for failing to report suspicious opioid orders. In July 2017 the DOJ shut down AlphaBay, a “dark web” marketplace that allegedly facilitated sales of prescription narcotics and heroin.

Other federal agencies have also stepped up efforts to regulate and combat opioid fraud and abuse. In an unprecedented step, the Food and Drug Administration (FDA) in June 2017 requested that Endo Pharmaceuticals remove an abuse-prone opioid, Opana ER, from the market. The FDA has also considered mandatory physician training as a tool to reduce opioid abuse. HHS endorsed wider availability of overdose-reversal medications and the development of non-addictive painkillers, and HHS-OIG issued a report identifying 400 physicians whose opioid prescriptions were “far outside the norm and warrant further scrutiny.” Finally, a number of entities, including the states of Ohio, Missouri, Oklahoma, the Cherokee Nation, several counties in Tennessee, and cities, such as Everett, Washington, have filed lawsuits against opioid manufacturers alleging that the companies fraudulently marketed prescription pain medication by misleading physicians and patients regarding the risks and benefits of prescription opioids.

Given the increased legislative, regulatory, and law-enforcement focus on opioid abuse, manufacturers, prescribers, hospital systems, clinics, and other healthcare providers should be conscious of the increased scrutiny and take a proactive approach to compliance issues. Prescribers and dispensers should update their compliance programs to ensure that they are appropriately identifying and addressing potential avenues of abuse and diversion, including comprehensive controlled-substance training.

Because the DOJ’s Opioid Fraud and Abuse Detection Unit will be data-driven, institutional registrants should have internal procedures in place to monitor key metrics likely to trigger regulatory scrutiny. Institutional practitioners should monitor controlled-substance orders as well as prescribing or dispensing patterns to identify discrepancies or potentially problematic trends. A comprehensive controlled-substance compliance program should also include a review of billings for controlled substances submitted to government payers to ensure the prescribing or dispensing was appropriate and will not lead to claims for overbilling or potential False Claims Act liability.


Wick Sollers is a partner and Dan Sale is a senior associate with King & Spalding in Washington, D.C.

Copyright © 2018, American Bar Association. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or downloaded or stored in an electronic database or retrieval system without the express written consent of the American Bar Association. The views expressed in this article are those of the author(s) and do not necessarily reflect the positions or policies of the American Bar Association, the Section of Litigation, this committee, or the employer(s) of the author(s).