Strict Liability for Pharmacists in California

If you’re a supervising pharmacist in California, you should take note of a recent appellate decision that upheld the pharmacy board’s right to revoke your license because of a subordinate’s intentional misconduct, even if you didn’t know about it.

The pharmacist in the case, who was the pharmacist-in-charge at a retail pharmacy, nearly lost his license because a technician secretly ordered and stole one million dollars’ worth of a dangerous drug over a two-year period. Up until then, the pharmacist had no history of discipline in his thirty years of holding a pharmacy license.

How did it happen? The technician would order large amounts of Norco, which is a compound of acetaminophen and hydrocodone, and have them delivered to the pharmacy on a day she was scheduled to work. When the orders came in, she would hide them in the store room, destroy the packing invoice, and take the drugs to her car (in her purse) whenever the on-duty pharmacist took a break.

The pharmacist-in-charge didn’t catch on to this because he never unpacked any drug deliveries, checked them against invoices, or stocked them; he delegated those tasks to others. And although he would sign off on the deliveries, the supplier’s delivery log only listed the number of containers being delivered, not their contents.

Ultimately, the pharmacist was the one who discovered the theft when he found a bottle of Norco in the store room. Since the pharmacy didn’t sell Norco, he notified management, and the ensuing investigation led to the technician’s arrest.

Even so, the pharmacy board filed an administrative action against him for six violations of the California Business and Professions Code and the Code of Regulations:

1. Failing to maintain a complete and accurate record of all controlled substances sold, received, or otherwise disposed of. See Bus. & Prof. Code §§ 4005, 4081, 4105, & 4301(j), (0); Code Regs. tit. 16, § 1718.
2. Failing to maintain records of acquisition and disposition for three years. Bus. & Prof. Code §§ 4081(a), 4105, & 4301(j), (o).
3. Allowing a technician to sign for dangerous-drug deliveries. Id. §§ 4059.5 & 4301(o).
4. Failing to properly supervise a technician. Id. §§ 4115(h) & 4301(o).
5. Failing to secure and maintain the facility and its spaces, fixtures, and equipment from theft. Bus. & Prof. Code §§ 4005 & 4301(o); Code Regs. tit. 16, § 1714(b).
6. Failing to provide effective controls to prevent the theft. Bus. & Prof. Code §§ 4005 & 4301(o); Code Regs. tit. 16, § 1714(d).

After the administrative hearing, the judge found the pharmacist liable for all but the fifth violation and proposed that he be punished by public censure.

But the board rejected that proposal, which was in its power to do, and found him liable for all six violations. As punishment, it revoked his license but stayed the revocation and placed him on probation for three years, with specific conditions.

In the board’s view, the pharmacist could’ve done more. He could’ve conducted random checks of the orders that he signed for. He could’ve required the pharmacy to close when the on-duty pharmacist took a break. He could’ve audited the pharmacy’s telephonic ordering system, which the technician used to place orders from her home, and restricted access to the passcode she used to do it. Were it not for these lapses, the board concluded, the theft could’ve been discovered sooner.

The pharmacist offered expert testimony that the custom, practice, and standard of care in the community didn’t require a pharmacist to monitor every menial task, but the board rejected that testimony and concluded that a supervising pharmacist’s legal duties included checking his staff’s work, actively monitoring inventories, and randomly auditing deliveries. And the board interpreted section 4081 to hold a pharmacist-in-charge liable for such violations regardless of whether he was aware of them.

The pharmacist asked the board to reconsider its decision, and when that was denied, he petitioned the trial court to challenge it by what’s called a writ of administrative mandamus. See Civ. Proc. Code § 1094.5.

The trial court denied his petition, so he appealed his case to the court of appeal, but he lost again. The appellate court agreed with him that he had a fundamental right to maintain his pharmacy license. See Hoang v. Cal. Bd. of Pharmacy (2014) 230 Cal. App. 4th 448, 455. But the court agreed with the board that, as a pharmacist-in-charge, he was responsible for the pharmacy’s compliance and for maintaining an inventory of dangerous drugs, whether he knew about them or not. Cf. § 4081(c) (precluding criminal liability for the acts of others without actual knowledge of wrongdoing). The court reasoned that this rule would better protect the public and align with a rule of strict liability under other licensing statutes. See Margarito v. State Athletic Comm’n (2010) 189 Cal. App. 4th 159, 168-69 (collecting cases).

In the end, the court even agreed that the technician’s prolonged, extensive theft was substantial evidence in itself that the pharmacist had failed to properly supervise things.

Sounds like strict liability to me.