‘This is organized crime’: Pharmacy board blasted for alleged corruption, retaliation at public hearing
The Alabama State Board of Pharmacy (ABOP) was subjected to a nearly two-hour grilling by lawmakers on Thursday after a recent report that found multiple “significant problems” with the board’s operations and perceived retaliatory practices against licensees.
The Alabama Examiners of Public Accounts report was compiled before Thursday’s Sunset Committee meeting. At this meeting, lawmakers scrutinize licensing boards that require legislative approval for their continued existence.
At Thursday’s meeting, multiple lawmakers, advocates and lawyers noted that the report did not paint a flattering picture of ABOP.
Initially, ABOP executive secretary Donna Yeatman addressed the committee, giving what seemed like a preemptive exculpation of the board’s reputation, offering a commendatory description of the board and its practices, especially through the COVID-19 pandemic.
“The board takes seriously its responsibility to ensure the safety of Alabama patients,” Yeatman said. “We are confident that every citizen in Alabama can rely on this board, as every action this board takes, every rule they write or amend, and every disciplinary action is driven by the board’s mandate to protect the citizens of Alabama.”
The report from the state examiners found several instances of “significant issues” with ABOP, including how it reported income, over-fining, levying non-specified fees, charging non-licensed entities, meeting minutes that are inconsistent with board actions, violations of Alabama’s Open Meetings Act, failure to file oaths of office with the secretary of state’s office, failing to deposit receipts promptly, violating the state’s open-bidding rules, inaccurate invoicing, overpaying vendors over the contracted amount and unlawfully procuring supplies and services.
Yeatman briefly addressed the issues in her prelude, agreeing with the examiners’ findings on some of the more minor issues and disagreeing with the examiners on more significant ones.
Regarding the anonymous pharmacists, Yeatman stated that since the questionnaire respondents were only a small portion of the state’s pharmacists, she believed “the overwhelming majority” were happy with the board and its actions.
Several members of the public also spoke. Some praised the board and its mission and policies, while others slammed ABOP with charges ranging from fleecing taxpayers to excessive and punitive fines meant to line board members’ pockets.
Jamie Moncus, a Birmingham attorney, represented a pharmacist named Billy East, and according to Moncus, East, a pharmacy employee, had his license unlawfully stripped by ABOP for a DEA statute that applied to the pharmacy, not an individual pharmacist. Moncus claimed he attempted to appeal the decision before Yeatman and two board attorneys, which was met only with laughter.
“I soon found out they were never interested in applying the law,” Moncus said. “They were never interested in the truth at all. They were all about grudges.”
Moncus also accused the board of charging witnesses intended to exculpate East to prevent them from testifying. He said the attorney general had to intervene and drop the charges to restore East’s license. East sued the board, and that lawsuit can be found below.
Attorney Joseph Kreps, who boasted of representing people before the board for nearly 20 years, gave the most impassioned and fierce condemnation of ABOP, accusing it of lining its pockets through punitive and arbitrary fees and fines levied against pharmacists.
“The pharmacy board’s funds are hidden from view,” Kreps said. “in 2023, licensing fees collected by this agency hit $4.4 million, with nearly $4 million of that spent on administrative salaries and benefits alone. These board members are paid. They are making a fortune being on this board. It’s wrong. They pocketed a combined $325,000 in salary and per diem payments, and travel expenses were more than $210,000. They extort $1 million annually from these licensees through unlawful fines and junk fees. Late fees surged almost 1,500% from 2013 to 2022.”
He continued, “They don’t care anything about the licensees. The only thing they care about is collecting money and funneling it into their own pockets.”
In one instance in the examiners’ report, a company failed to report an ownership change in an allowable timeframe. The Board offered the company two options: Option one was for the company to sign a consent agreement, which is a reportable offense, and pay a fine of $2,000 per permit for a total of $4,000. Option two was for the company to sign a deferral agreement, which is a non-reportable offense, and pay an administrative cost of $5,000 per permit for a total of $10,000.
“That is extortion,” Kreps said. The other issue I would say is — these board members are prosecuting and collecting illegal fines and illegal fees, junk fees, and they’re funneling that money to themselves.”
“This is not the regulation of a profession. This is organized crime, in my opinion, and it’s extortion. And it’s all in black and white,” he continued.
Lawmakers on the committee asked Yeatman extensive questions regarding the examiners’ report, seeking clarification on the serious issues found. Their questions were answered. However, multiple lawmakers expressed serious concerns about the report and ABOP’s actions while acknowledging the importance of the board’s regulatory role.
“This is one of the worst reports, and I haven’t been on the Sunset Committee very long, but it’s one of the worst reports, if not the worst one I’ve seen,” said State Sen. Sam Givhan (R-Huntsville). “I would recommend that the board start working post haste to remedy these issues.”
State Rep. Kerry Underwood (R-Tuscumbia) said the optics of the board’s actions give the appearance of “pay-to-play.”
“I know that this is the Sunset Committee, but there is a lack of sunlight in your program, in your department and in your board,” said State Rep. Matt Simpson (R-Daphne.). “I’m not saying you’re sweeping things under the rug. There is an appearance of; if you were sweeping things under the rug, there is nothing that we would be able to see these things.”
State Sen. Keith Kelley (R-Anniston) emphatically stated that if this report had come against a less significant board, it would have been “lights out,” meaning the legislature would likely vote not to renew that agency.
“Whenever I look at this, to say I’m concerned is an extreme understatement,” Kelley stated.
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