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Texas Sues Drug Manufacturer Blamed for West Coast Deaths

Apothecure Inc. sold injectable pain killer meant for treatment of gout

December 11, 2007

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Texas Attorney General Greg Abbott today joined an enforcement action against a Dallas-based drug manufacturer and pharmacist. The state charged Apothecure Inc. with formulating a highly potent injectable painkiller mixture that is associated with three deaths in Oregon and Washington.

Texas also took action against Spectra Pharm Inc., an Apothecure-owned retail store that advertises and sells over-the-counter drugs and dietary supplements. The states of Oregon and Texas are jointly prosecuting this enforcement effort.

"These defendants are charged with violating state and federal laws that protect patients from unlawful or dangerous pharmaceutical products," Attorney General Abbott said. "Texas pharmacies and drug manufacturers must comply with the law. We will continue working with authorities to protect the health and safety of all Texans."

The highly potent drug linked to the west coast deaths, Colchicine, is only recognized by the U.S. Food and Drug Administration (FDA) for the treatment of gout. However, according to court documents, Apothecure formulated Colchicine to treat neck and back pain.

Apothecure's formula far exceeded normal potency levels, yet it allegedly failed to safeguard patients by testing the mixture for potency strength, another violation.

The company sold the drug in Oregon, where the state's health officials found that its use resulted in three deaths -- two in Oregon and one in Washington. The victims were given dosages with a potency of 4 milligrams per milliliter, rather than the 0.5 milligrams per milliliter stated on the government-approved dosage labels.

In addition, Apothecure is charged with violating Oregon law by distributing drugs in that state without a state-issued pharmacy or drug manufacturing license.

According to the Abbott, Apothecure and its owner, Gary Osborn, manufacture and sell over-the-counter drugs and dietary supplements. However, the defendants also unlawfully manufacture drugs not approved by the FDA, and do so under the guise of "compounding" prescription drugs.

Licensed pharmacies in Texas can legally compound drugs by combining, mixing or altering ingredients to create a customized medication for an individual patient based on a physician's prescription. However, Texas law requires that customized compounded drugs be approved by the FDA.

According to court documents, the defendants claim that Apothecure is authorized to "compound" drugs. However, Apothecure's actual activities exceed the pharmacy's authorized scope of practice, crossing the line into prescription drug manufacturing. The attorney general charged Apothecure with violating state law by:

• manufacturing drugs that are not approved by the FDA, as required by federal law;

• selling prescription drugs to persons in several states and countries in which the defendant is not authorized to operate as a pharmacy and/or as a drug manufacturer;

• substandard manufacturing practices that result in adulterated or misbranded drugs; and

• selling prescription drugs to persons who cannot lawfully prescribe such drugs in Texas, a violation of Texas law.

In addition, the lawsuit alleges the defendants failed to use proper manufacturing practices, employed incorrect labels and made exaggerated claims about the benefits of its dietary supplements. Products marketed as cures or treatments for diseases or health conditions, including cancer, blood clots, blood pressure and diabetes, must be approved by the FDA and are not dietary supplements.

The Texas Department of State Health Services referred the matter for legal action to the Attorney General. The defendants are charged with violating the Texas Deceptive Trade Practices Act (DTPA), which can result in civil penalties of $20,000 per violation. In addition, the Attorney General accuses the defendants of violating the Texas Food, Drug and Cosmetic Act, which can carry penalties of up to $25,000 per day, per violation.

Apothecure is also the defendant in another state case for refusing to comply with an administrative subpoena issued by the Texas Board of Pharmacy. The subpoena sought Apothecure records related to drug audits and invoices for prescription drugs distributed in any other state where the company was not licensed. That case is still pending and these records still have not been produced.

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