United States Drug Enforcement Administration

SACRAMENTO, Calif. — Stericycle Inc., an international waste management company headquartered in Lake Forest, Illinois, has agreed to pay more than $56 million to resolve parallel criminal and civil investigations into its improper handling of controlled substances between 2015 and 2020, U.S. Attorney Eric Grant and Drug Enforcement Administration Special Agent in Charge Bob P. Beris announced.

Stericycle collected, transported, and disposed of pharmaceutical waste for hospitals, clinics, pharmacies, and other health care providers across the United States and abroad. 

“Stericycle has accepted responsibility for handling controlled substances in a manner that was insecure, unsafe, and unlawful,” said U.S. Attorney Grant. “Despite being warned by the DEA that it needed to correct its deficient handling procedures, the company operated an insecure transportation network, relied on multiple unregistered facilities, and failed to notify the DEA of diversions and significant losses as required by law. Today’s resolution demonstrates the Justice Department’s continuing commitment to ensuring that all registrants safely and securely handle controlled substances so that dangerous drugs are not diverted into the community.”

“DEA will hold organizations accountable who violate the Controlled Substances Act and improperly handle controlled substances. Stericycle’s actions were far more troubling than a simple reporting error,” said Bob P. Beris, Special Agent in Charge of the Drug Enforcement Administration, San Francisco Field Division. “These drugs did not merely go unaccounted for, employees and others stole them, used them, or diverted them into the community. Such conduct endangers public safety, fuels addiction, and undermines the integrity of our regulatory system. The DEA remains committed to ensuring that every registrant fulfills their obligations to protect the public from exactly these kinds of risks.”

“Controlled substance regulations are designed to keep dangerous and addictive medications out of the wrong hands. Stericycle ignored those responsibilities, resulting in expired medications being stolen and sold illegally on the street,” said FBI Sacramento Special Agent in Charge Sid Patel. “The FBI and our law enforcement partners will continue pursuing those who endanger the public through negligence or criminal conduct.”

Criminal charges filed today allege that Stericycle conspired to defraud the United States by failing to report thefts and significant losses of controlled substances to the DEA. On four separate occasions, the company offered justifications for failing to file required Form 106s that were unsupported by federal regulations. As part of a one‑year deferred prosecution agreement (DPA) with the Department of Justice, Stericycle will pay a $19.08 million criminal penalty.

Separately, Stericycle has agreed to pay $37.81 million to resolve civil liability for repeated violations of the CSA.

Because of the risk that prescription drugs can be diverted or misused, the handling of controlled substances is tightly regulated under the Controlled Substances Act (CSA).

According to court documents, Stericycle was registered with the DEA as a “reverse distributor,” allowing it to receive unwanted, unusable, or expired controlled substances from hospitals, pharmacies, and other registrants. As a reverse distributor, Stericycle was subject to strict recordkeeping, reporting obligations, security requirements, and regular DEA inspections of its registered facilities, including the duty to promptly notify the local DEA Field Division Office in writing of any theft or significant loss.

As admitted by the company, Stericycle circumvented these requirements by using temporary storage facilities that were not registered with the DEA and thus not subject to regular inspection. Security was inadequate at many locations, including at the company’s former facility in Rancho Cordova. In some instances, controlled substances were stored in unlocked trailers within fenced yards. Though some facilities had security cameras, several cameras were non‑operational.

Stericycle conspired to defraud the DEA by avoiding the filing of reports that would have alerted the agency to thefts and significant losses of controlled substances in its care. Multiple Stericycle managers and executives were aware that the company lacked a reliable system for tracking packages across its transportation network or auditing packages received in Indianapolis, creating opportunities for diversion.

Under the DPA, Stericycle has agreed to continue cooperating in any ongoing or future criminal investigations related to this conduct. The company also agreed to enhance its compliance program, including measures for independent oversight, training, internal investigations of reported misconduct, and compliance reporting to the Department of Justice for the remainder of the agreement’s term. The resolutions do not include the criminal release of any individuals.

The government reached this resolution based on several factors, including the nature and seriousness of Stericycle’s conduct, its knowing and willful decisions not to report thefts or significant losses, its use of unregistered facilities to store controlled substances, and the company’s divestiture of the business component at issue in April 2020 to a non‑affiliated company that brought the business segment into compliance. The remaining business was acquired by another company in November 2024. Stericycle also enhanced its compliance program and committed to continuing improvements to meet the minimum requirements set forth in the DPA. The company received credit for accepting responsibility for its criminal conduct.

The Drug Enforcement Administration and the Federal Bureau of Investigation conducted the investigation. Assistant U.S. Attorneys Michael D. Anderson and Adrian T. Kinsella are prosecuting the case, and Assistant U.S. Attorney David E. Thiess assisted with the civil settlement.