FDA informs doctors of rogue distributors, offers drug purchasing tips

To reduce the threat to patients posed by unapproved, counterfeit, or otherwise unsafe prescription drugs, the FDA has issued letters to doctors who may have obtained these drugs from a rogue distributor. In addition to warning about the rogue distributors, the letters also contain tips on how doctors can avoid purchasing drugs that: (1) are fake, contaminated, ineffective, or otherwise unsafe; (2) have not been approved as safe and effective by the FDA; (3) do not contain the appropriate amount of active ingredients; (4) contain harmful ingredients; (5) were not manufactured using quality manufacturing processes; or (6) were stored under improper conditions.

These letters are part of the FDA’s “Know Your Source” program, which works to inform doctors about how to protect their patients from unsafe drugs. Here is a list of the most recent letters:

  • On April 1, 2015, the FDA sent more than 300 letters to medical practices that may have purchased unapproved prescription drugs, or unapproved injectable devices, from a foreign supplier, Gallant Pharmaceutical International, Inc., also known as Gallant Medical International, Inc.
  • On July 11, 2013, the FDA sent approximately 250 letters to medical practices that purchased Botox® from “Online Botox Pharmacy,” “Onlinebotox.com,” and “Onlinebotox.” The medication’s outer carton was counterfeit, while the vial inside was labeled as a foreign version of Botox.
  • On May 13, 2013, the FDA sent more than 1,000 letters to medical practices that may have received prescription drugs from Pharmalogical, Inc., d/b/a Medical Device King, that contained a counterfeit version of Altuzan (bevacizumab) that had no active ingredient. Bevacizumab is approved in the U.S. as Avastin®, and sold by Genentech, Inc.

Many of the distributors of these unsafe drugs have had criminal actions brought against them.

Growing trend

Ilisa Bernstein, Pharm.D., J.D., Deputy Director of FDA’s Center for Drug Evaluation and Research’s Office of Compliance, says she has seen a “growing trend of health care professionals and medical practice administrators who purchase prescription drugs from rogue wholesale drug distributors outside of the legitimate supply chain.” Bernstein offers a number of tips for doctors:

  • If an offer sounds too good to be true—it probably is. Deep discounts may indicate that the products are stolen, counterfeit, or unapproved.
  • Doctors should ensure they are receiving FDA-approved prescription drugs.
  • Only purchase from state-licensed wholesale drug distributors.
  • Check to see if the packaging, labeling, warnings, and dosing recommendations differ in any way from the FDA-approved packaging, labeling, warnings, and dosing for the product.
  • If several patients report that they are experiencing a new side effect or lack of therapeutic effect from the same product, consider that the drug may be substandard or counterfeit.

New tracing, verification, and identification system

The FDA is also working with prescription drug manufacturers, wholesale distributors, repackagers, and dispensers to establish and implement a new system that allows product tracing, verification, and identification as drugs travel through the U.S. market. This effort is part of FDA’s implementation of the Drug Supply Chain Security Act (DSCSA)—Title II of the Drug Quality and Security Act signed into law on November 27, 2013. Under the DSCSA, doctors who dispense or administer prescription drugs are required to purchase their prescription drugs only from authorized trading partners licensed by or registered with the state or federal government.


Highlight on North Carolina: NC ramps up for ICD-10, provides fun coding facts

NCTracks, a new multi-payer Medicaid Management Information System for the North Carolina Department of Health and Human Services (NC-DHHS) has used a “RAMP UP to ICD-10” project to assist provider organizations with the transition from ICD–9 to the ICD-10 code sets.

ICD-10 Background

On January 16, 2009, HHS posted a Final rule that would replace ICD-9 (International Classification of Diseases, 9th Revision, Clinical Modification) code sets for all Health Insurance Portability and Accountability Act (HIPAA) covered entities with ICD–10–CM (10th Revision, Clinical Modification) for diagnosis coding, and ICD–10–PCS (10th Revision, Procedure Coding System) for inpatient hospital procedure coding, effective October 1, 2013.

On August 24, 2012, HHS posted a Final rule that extended the compliance date to October 1, 2014. Congress voted to extend the October 1, 2014 ICD-10 implementation date for one year, until October 1, 2015.

The new ICD-10 code set provides a significant increase in the specificity of the reporting, allowing more information to be conveyed in a code.  The number of diagnosis/procedure codes is greatly expanded from about 17,000 to over 150,000 codes. Examples of the enhancements made with ICD-10 include:

  • Reporting of laterality (right vs. left designations), reflecting the importance of which side of the body or limb (e.g., left arm, left kidney, left eye) is the subject of the evaluation.
  • Restructured reporting of obstetric diagnoses. In ICD-9-CM, the patient is classified by diagnosis in relation to the episode of care. In ICD-10-CM, the patient is classified by diagnosis in relation to the patient’s trimester of pregnancy.

CMS has a webpage dedicated to the ICD-10 rollout. NCTracks also has a webpage with answers to frequently asked questions regarding ICD-10.


To help organizations prepare for ICD-10 implementation, NCTracks offered a series of topics intended to assist North Carolina providers in navigating the activities that needed to be done. RAMP UP stands for: Research, Assessment, Mapping, Process Improvement and Training, Update System(s) with Vendors, and Perform Testing. A brief description of each topic follows:

  • Research. A successful transition to ICD- 10 requires significant research and planning, including effective communication to stakeholders.
  • Assessment. The starting point for ICD-10 transition is an assessment to understand the role and location of ICD-9 codes across all systems, processes, policies and reports. Providers must identify business areas affected by ICD-10 and determine the level of support needed for successful transition.
  • Mapping. The process of evaluating and documenting the relationship between ICD-9 and ICD-10 code sets is a major aspect of preparing for ICD-10. While the General Equivalence Maps (GEMS) developed by CMS are a great starting point, for mapping they do not cover all of the potential ICD-9 to ICD-10 relationships, so additional analysis may be necessary. NCTracks has created a helpful crosswalk connecting the old ICD-9 codes to the new ICD-10 codes.
  • Process improvement and training. The move from ICD-9 to ICD-10 will affect not only computer systems, but business processes as well. Successful implementation will require evaluation and update of all aspects of provider business operations to coincide with the technical changes. This will include training to ensure the staff acquires the necessary skills and knowledge on the processes, procedures, policies, and system updates affected by the ICD-10 transition.
  • Update system(s) with vendors. The activities in research, assessment, mapping, and process improvement lead up to updating of computer system(s) for ICD-10. Part of updating computer systems involves vendor coordination to synchronize changes to inbound and outbound external interfaces.
  • Perform testing. Thorough testing ensures that business functions will continue normally throughout the transition. A rigorous testing methodology, documented test plan, and accurate test data are integral to achieving results that meet expectations.

North Carolina Ready for ICD-10 Launch

On April 30, 2014, NCTracks reported that it has completed 10 months of internal testing activities and recently started external testing with providers, which will continue through August 2015. It selected providers representing a diversity of practices, specialties and facilities.

According to NCTracks, system integration testing started in June 2014, and by November 2014, improvements had been made so that 100 percent of claims passed. In December 2014, NC-DHHS staff began user acceptance testing with CSC, the fiscal agent that manages NCTracks. This testing ran through mid-April 2015 using various scenarios. CSC ran selected transactions for professional, dental and institutional claims, representing a minimum of 10,000 claims. CSC converted all submitted ICD-9 codes to an ICD-10 equivalent using a crosswalk table, then compared and validated the results from the test against previous production claims.

Fun Facts

NCTracks has also posted some “ICD-10 Fun Facts Sheets” highlighting the greater specificity and unusual nature of some of the diagnosis and procedure codes coming with ICD-10:

Using connectivity to expand telehealth to rural and remote areas

On April 21, 2015, the U.S. Senate Subcommittee on Communications, Technology, Innovation, and the Internet, heard from witnesses on the progress made by the private sector and government entities to expand the benefits of telehealth nationwide, particularly in rural areas. The hearing also explored the connectivity challenges facing many health-care providers and patients attempting to take advantage of innovative telehealth applications.


Globally, the number of patients using telehealth services is predicted to grow from 350,000 in 2013 to 7 million by 2018. Last Congress, the Senate passed a resolution (S. Res. 588) recognizing that access to hospitals and health-care providers for patients in rural areas is “essential to the survival and success of communities in the United States.” The resolution further stated that Congress must address the unique health-care needs of rural areas, in order to ensure that those communities continue to thrive.


The subcommittee heard testimony from four witness: (1) Dr. Kristi Henderson, Chief Telehealth and Innovation Officer, University of Mississippi Medical Center; (2) Jonathan D. Linkous, Chief Executive Officer, American Telemedicine Association; (3) Dr. M. Chris Gibbons, Distinguished Scholar in Residence, Connect2Health Task Force, Federal Communications Commission; and (4) Todd Rytting, Chief Technology Officer, Panasonic Corporation of North America.


Henderson’s testimony focused on the use of telehealth in Mississippi, which leads the nation in prevalence of multiple chronic diseases and has the lowest number of doctors per capita of any state in the nation. According to Henderson, the greatest challenge is winning federal level reimbursement parity that will make telehealth attractive in the marketplace and securing the reliable, high quality connectivity.

She urged the subcommittee to focus on three issues: (1) the need for continued support of the Universal Service Fund, which, through its Rural Health Care Support Mechanism, allows rural health care providers to pay rates for telecommunications services similar to those of their urban counterparts, making telehealth services affordable; (2) broader application of the Federal Communication Commission’s (FCC) E-rate program, which connects the nation’s schools and libraries to broadband; and (3) the need for a more inclusive Health Care Connect Fund, which would allow large hospitals to receive a more robust reward for serving as a consortium lead for a network of smaller rural hospitals and clinics.


Linkous gave examples of telehealth growth. He testified that, in 2015, over 125,000 patients who suffer stroke symptoms will be diagnosed by a neurologist in an emergency room using a tele-stroke network; tele-ICU will be used for 11 percent of the nation’s intensive care beds to help oversee almost 500,000 critically ill patients; and about one million patients with an implantable pacemaker or suffering from an arrhythmia will be remotely monitored.

Despite this growth, Linkous testified that certain reforms are necessary to achieve the full benefits of telehealth. These reforms include: (1) providing the infrastructure to physically enable telehealth services; (2) making sure that benefit coverage will financially enable telehealth networks; and (3) the need for Congress to direct or facilitate the development of new telehealth networks.


Gibbons described activities of the FCC’s Connect2Health Task Force. According to Gibbons, the Task Force is a senior-level, multi-disciplinary effort to move the needle on broadband and advanced health care technologies by thinking across various FCC silos, with the Task Force serving as an umbrella for the FCC’s health-related activities.

Gibbon’s assured the subcommittee that: (1) telehealth and other broadband-enabled health solutions are playing (and likely will continue to play) a significant role in helping to achieve the national objective of a healthier America; (2) the FCC is actively engaged in efforts to ensure that telehealth and other broadband-enabled health technologies are accessible in rural and remote areas, on tribal lands, and in other underserved sectors of the country; and (3) tangible progress on rural telehealth is within reach if broadband is done right and done now in rural areas, outreach and education is provided, better tools to measure progress are provided, solutions are tailored to the locality, and collaboration with public-private stakeholders occurs.


Rytting testified that Panasonic is committed to the effort to transform America’s healthcare system through the power of information technology supported by robust broadband connectivity. Panasonic believes, according to Rytting, “that a fully-connected and interoperable health information and communications technology (ICT) ecosystem will provide the foundation to improve the coordination and quality of care, better health outcomes, and reduced overall costs.”

Because a key component of this ICT ecosystem is the utilization of telehealth and remote patient monitoring services, “Panasonic…urge[s] that national policy…reflect the dynamic and transformative nature of advanced ICT solutions, and not inhibit the innovation that holds the promise to continually improve the care delivery system even as it can contain costs.”

Rytting suggested that: (1) Congress and federal agencies should ensure that their approaches utilize a technology-neutral approach, so as not to “lock in” a limited set of solutions that, while deemed adequate for today, may impede innovations; (2) well-intentioned overregulation can act as a disincentive to investment and innovation in the healthcare space, potentially short-changing or harming patients; (3) there is an ongoing need for cross-agency coordinated inquiries into opportunities for wireless broadband allocations that can be utilized by healthcare applications; (4) in the Universal Service Fund context, the FCC’s policies should constantly be re-examined for ways to foster innovation; and (5) the solutions needed for a fully connected healthcare system must be able to utilize both licensed as well as unlicensed spectrum, and be permitted to operate with appropriate sharing arrangements.

Report highlights 2014 quality improvement achievements, 5-year goals

CMS’ 2014 Quality Improvement Organization (QIO) Program report describes its new program structure, highlights its recent statistical achievements, offers examples of its successes, and outlines its five-year goals for the QIO program.

Program structure

According to the report, the new structure of the QIO program follows a functional model with two types of QIOs: (1) Quality Innovation Network-QIOs (QIN-QIOs); and (2) Beneficiary and Family Centered Care-QIOs (BFCC-QIOs). This dual function structure separates the regulatory complaint review process from quality improvement work. For example, 14 regional QIN-QIOs work with providers, community partners, and beneficiaries on initiatives to improve patient safety, reduce harm, engage patients and families, improve clinical care, and reduce health care disparities. Two BFCC-QIOs manage all beneficiary complaints and appeals across the nation.


According to CMS, recent achievements from the program include:

  • nearly $1 billion in cost savings from combined QIO programs;
  • recruitment of 1,826 professionals potentially impacting 4.1 million beneficiaries;
  • 53 percent reduction in central line-associated blood infections;
  • 20 percent improvement in controlling blood sugar levels among participants screened;
  • 5,021 nursing homes participating in a national collaborative;
  • 6,250 beneficiaries in 981 nursing homes now restraint-free;
  • 3,374 bed sores prevented or healed in 787 nursing homes; and
  • 44,640 potential adverse drug events prevented.

Examples of success

CMS offered examples of its successes in the areas of better health, better care, lower cost, hospital engagement, using data from the Centers for Disease Control and Prevention (CDC) for prevention, and the Million Hearts® initiative.

  • Better health. CMS highlighted the following better health efforts: (1) using faith-based organizations to promote heart health; (2) maximizing electronic health record system benefits for physicians and patients; (3) the Everyone with Diabetes Counts program going national; and (4) partnering with local colleges to train bilingual diabetes educators.
  • Better care. Highlights of better care initiatives included: (1) collaboration with hospitals to reduce health care-associated infections (HAIs); (2) creating a replicable model for sustainable quality improvement; (3) enabling peer-to-peer learning and sharing for nursing home staff; (4) using new processes to prevent adverse drug events; and (5) tools for improving discharge communications and fewer drug errors.
  • Lower costs. Initiatives to lower costs included: (1) implementation of agreed-upon quality measures; (2) the use of value-based payment and quality reporting models; and (3) helping providers in multiple care settings to navigate quality reporting requirements.
  • Hospital engagement. CMS highlighted the cooperation of the Washington State Hospital Association and Qualis Health Quality Innovation Network, the QIN-QIO for Idaho and Washington, which are jointly tackling common health concerns, including reducing hospital readmissions and HAIs.
  • CMS highlighted a 2014 CDC pilot program with seven QIOs to reduce catheter-associated urinary tract infections.
  • Million Hearts campaign. CMS reported that QIN-QIOs are adding a community level connection to the Million Hearts initiative to prevent one million heart attacks and strokes by 2017.

Five-year goals

The QIN-QIO five-year goals focus on the patient and a commitment to achieving better care, better health, and lower costs. They include:

  • improving cardiac health and care disparities;
  • increasing diabetes awareness and education;
  • improving prevention through meaningful use of health information technology;
  • reducing HAIs;
  • improving nursing home resident care and safety;
  • reducing antipsychotic drug use in long-term care facilities; and
  • using a community approach to fully support coordination of care and the reduction of preventable hospital admissions and readmissions.