Pharmaceutical Diversion & Compliance Implementation

The diversion of pharmaceutical controlled substances from the drug supply chain and healthcare delivery system places the public at risk, strains government resources and places increased pressure on law enforcement and regulatory agencies to proactively identify and prevent the transfer of drugs from legitimate commerce into the illicit marketplace. Regulatory compliance plays an important role in ensuring that businesses have established a secure and accountable system of distribution and dispensing that should prevent diversion at all levels of the pharmaceutical supply chain. The accurate accounting of controlled substances and the preparation and maintenance of transaction data is the foundation of a secure distribution system.  Proactive review of transaction data in combination with customer due diligence by regulated entities can identify potential weaknesses and anomalies within the supply chain that can be addressed before large-scale diversion occurs.  If available, this same transaction data can be utilized by regulatory and law enforcement agencies to ensure compliance and assist in the inspection and investigation of regulated entities involved in the manufacture, distribution and dispensing of controlled substances. Controlled substance transaction data provides a complete picture to state regulators and law enforcement agencies about controlled substances entering their jurisdiction, ordering patterns and potential areas of concern. This massive amount of data can be harnessed and integrated with other data systems to provide an effective regulatory agency and law enforcement tool that could identify potential pharmaceutical controlled substance diversion. 

Pharmaceutical manufacturers, wholesalers and distributors are required by statute to make periodic reports to the Federal government concerning certain downstream controlled substance transactions.  The data is collected and housed in the Drug Enforcement Administration (DEA) Automation of Reports and Consolidated Orders System (ARCOS) and is utilized to identify purchase anomalies, trends and changes of controlled substance distribution patterns in the United States.  

Some states have the legal authorization to collect ARCOS-like transaction data from regulated entities that distribute within their respective jurisdictions.  However, the lack of a secure, big data IT system that has transaction specific analytics capabilities is either not available or not cost effective, so the data is either not utilized, or not analyzed in the most efficient or effective manner. 

The Solution

Qato anomaly detection solution provides a scaleable, big data system that can securely maintain data in a format that allows inspectors/investigators to search for data anomalies as well as providing manual search functions for specifically tailored data analytics requests. This system can be utilized, for example, by pharmacy board inspectors/investigators to identify suspicious transactions based on orders of unusual size, orders deviating substantially from a normal pattern, and orders of unusual frequency.  They can then schedule pharmacy inspections based on this information. Additionally, the use of downstream controlled substance transaction data can:

• Depending on the data fed into the system, it enables investigators to compare downstream transaction data with actual pharmacy output using prescription drug monitoring program (PDMP) data

• Provide regulators/investigators with a means to identify areas of the state that have concentrated distribution levels of a particular controlled substance to identify potential geographic areas of concern

• Help regulators/inspectors identify downstream customers who are purchasing small quantities from various distributors to avoid detection

• Provide inspectors with the ability to review controlled substance purchases before they inspect a particular pharmacy and verify that the purchase information provided to the inspectors matches the system information

• Provide regulators/investigators with data concerning controlled substance sales to physicians’ offices who often do not report to the PDMP

• Provide data that is not HIPAA restricted and contains no patient information.  States that do not allow law enforcement or regulator access to PDMP information will now have a tool that can assist in identifying diversion.