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In early 2022, McKesson, Cardinal, and AmerisourceBergen (known as the Big 3) agreed to pay a combined $19.5B over 18 years to settle lawsuits filed by state and local governmental entities perpetuating their involvement in fueling the opioid epidemic.

The funds will positively impact thousands of communities across the United States affected by the excessive dispensing and usage of opioids. In addition, the Big 3 agreed to implement injunctive relief terms, including establishing a clearinghouse to consolidate data from all three distributors. This data will be available to all settling states and territories (46 of 49 eligible states, the District of Columbia, and all eligible territories who joined the settlement) for their anti-diversion efforts.

For drug suppliers, staying on the right side of the law isn’t just good practice –– it’s paramount.

In this blog, we’ll discuss the introduction of specialized roles within the wholesalers, such as the Chief Diversion Control Officer and the Controlled Substances Monitoring Program (CSMP) Committee. At a high level, these jobs will oversee critical functions, set metrics, and evaluate policy adherence. Within the blog, we’ll also unravel the intricacies of the CSMP and why compliance with laws and regulations surrounding controlled substances is crucial.

Understanding the CSMP: A Blueprint for Responsible Distribution

The Controlled Substances Monitoring Program (CSMP) is a new program reshaping how the big 3 wholesalers manage controlled substances. Other wholesalers are likely to follow suit and implement similar programs.

But what exactly is the CSMP? At its core, the CSMP is a structured framework designed to monitor, regulate, and ensure compliance in the distribution of controlled substances. It requires the creation of new specialized roles within the wholesaler, such as the Chief Diversion Control Office, which we discuss next.

Chief Diversion Control Officer: Pillar of Compliance

Imagine the Chief Diversion Control Officer (CDO) as the guardian of compliance. Appointed by each Distributor, this seasoned individual, well-versed in controlled substances laws and regulations, is pivotal in overseeing the entire CSMP.

Their role is crucial, as they’ll report directly to the senior executive responsible for pharmaceutical distribution or the most senior legal officer. They approve material revisions to the CSMP and provide quarterly reports to the CSMP Committee, ensuring transparency and accountability.

CSMP Committee: The Oversight 

The CSMP Committee, a gathering of senior executives in legal, compliance, distribution, and finance, provides necessary oversight. Regular meetings will evaluate critical aspects such as material modifications to the CSMP, diversion trends, policy adherence, and resource needs.

Their insights are crucial as they review and approve the specific metrics to identify red flags, ensuring a proactive stance in preventing potential diversion issues. This committee sets the tone for compliance, ensuring that the CSMP operates effectively and meets the highest standards.

Quarterly, the CSMP Committee submits written reports to the Chief Executive, Chief Financial, Chief Legal Officers, and the Board of Directors. These reports address the distributor’s adherence to policies and regulations, provide recommendations for resource allocation, and highlight any significant revisions to the CSMP. This oversight is meant to ensure a robust compliance framework.

CSMP Personnel: Vigilant Guardians

Program personnel, beyond the CDO and CSMP Committee, are responsible for the day-to-day execution of various CSMP functions. These include on-boarding and approval of new pharmacies for the sale of controlled substances, setting and adjusting pharmacy thresholds for controlled substances, and suspending or terminating pharmacies when necessary.

CSMP Personnel are central in submitting critical reports, including timely submission of suspicious orders and other relevant reports to settling states (or the Clearinghouse, when operational). These reports contribute to the overall monitoring and regulatory efforts to prevent diversion.

CSMP Training and Independence: Prepared and Unbiased

All new CSMP members must undergo comprehensive training sessions, equipping them with a deep understanding of the CSMP, their obligations, and their duties in maintaining adequate controls against the potential diversion of controlled substances. They will also receive annual training to act as a refresher and to stay abreast of the ever-evolving regulatory landscape.

CSMP personnel operate autonomously, detached from any influence that could compromise their objectivity. This separation is particularly crucial when making decisions that impact onboarding new pharmacies, adjusting thresholds, or addressing compliance concerns. The CSMP’s commitment to independence ensures that every decision is in the best interest of compliance and public safety.

While independence is critical, collaboration is equally vital. CSMP personnel and sales teams maintain a cooperative relationship, fostering open communication channels. Though CSMP personnel collaborate with sales teams, sales isn’t involved in decision-making. This collaboration becomes paramount when addressing compliance issues. As the eyes and ears on the ground, sales personnel promptly report any potential red flags to CSMP personnel, ensuring swift and effective resolution.

To fortify the integrity of CSMP decisions, the CSMP imposes specific compensation structures. Salespeople who earn commissions cannot tie their compensation solely to the sales of controlled substances. Salespeople who earn commissions cannot tie their compensation solely to the sales of controlled substances. This measure ensures that financial incentives do not compromise the independence of CSMP personnel, reinforcing a culture of compliance that stands on its own merits.

Conclusion: Charting a Course for Compliance Excellence

The CSMP and its personnel mark a paradigm shift in the pharmaceutical distribution landscape. It’s designed so that every aspect of the program ensures compliance, transparency, and accountability starting with the Chief Diversion Control Officers all the way to the meticulous oversight provided by the CSMP Committee and beyond. As pharmacies and stakeholders navigate this new era, no one can overstate the significance of the CSMP. It’s not just a program; it’s a commitment to a safer, more responsible future in controlled substance distribution.

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