News Release
August 7, 2006

Hospital Pays US $750,000 For Regulatory Violations Of The
Comprehensive Drug Abuse Prevention And Control Act

AUG 07 -- (HOUSTON, TX.) St. Joseph Regional Health Center, which serves the Brazos Valley area, has entered into a Stipulated Agreement to pay the United States $750,000 to resolve numerous alleged regulatory violations of the Comprehensive Drug Abuse Prevention and Control Act, United States Attorney Don DeGabrielle announced today. St. Joseph Regional Health Center is based in Bryan, Texas.

A series of calls expressing concern that St. Joseph Regional Health Center (hereinafter “St. Joseph) was failing to comply with regulations pertaining to the monitoring and maintenance of controlled substances brought the hospital to the attention and under the scrutiny of the Drug Enforcement Administration, Houston Field Division, Diversion Control Program investigators in February 2002. Exercising its administrative authority to review pharmaceutical records pertaining to the dispensing of controlled substances, investigators of the DEA Diversion Control Program, executed an Administrative Inspection Warrant at St. Joseph, seized records and conducted an audit of controlled substances for the time period beginning in May 2000 through March 12, 2003. The audit confirmed St. Joseph’s failure to keep adequate records as required by law, and the case was referred to the U.S. Attorney’s Office for civil prosecution.

While not admitting liability, St. Joseph Regional Health Center today paid $750,000 to the United States per the terms of the agreement. The United States, in turn, has agreed not to file a civil complaint which would have alleged that during the period of January 1999 through December 31, 2002, St Joseph had failed to make, keep or furnish records and reports of what controlled substances the pharmacy received and dispensed; that controlled substances were prescribed for non-legitimate medical purposes; and lastly, that the hospital shipped Schedule II controlled substances to an offsite location without the requisite DEA form, all in violation of the regulations promulgated under the Comprehensive Drug Abuse Prevention and Control Act of 1970 (hereinafter “The Act”). Additionally, St. Joseph acknowledges it is aware of the provisions of the Act and agrees to full compliance with the Act and its regulations henceforth.

The United States was represented by Assistant United States Attorney Jill O. Venezia of the Civil Division.

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