ABINGDON, Va. (WFXR) – In order to settle claims that Sovah Health violated the Controlled Substances Act (CSA) multiple times between 2017 and 2020, the hospital system has agreed to pay $4.36 million to the federal government.

According to the Department of Justice, this is not only the third-largest civil penalty ever obtained from a hospital system under the CSA, but the largest ever in the Fourth Circuit. 

The claims center around the failure of Sovah Health — a regional health care delivery system with hospital campuses in Danville and Martinsville — “to have effective controls in place to prevent the diversion of powerful painkilling prescription opioids,” the DOJ said in a statement on Wednesday, June 8.

From 2017 to 2019, the department says a Sovah Health pharmacy technician in Danville diverted more than 11,000 Schedule II controlled substances from the hospital system.

Then, from January 2020 to May 2020, a nurse at Sovah Health Danville reportedly tampered with fentanyl vials and hydromorphone injectables by replacing the taking the controlled substances for her own use and replacing them with saline.

The DOJ says the U.S. accused Sovah Health of failing to provide effective controls and procedures to guard against the diversion of controlled substances, filled orders for controlled substances without a system in place to disclose suspicious orders of controlled substances, and failed to maintain readily retrievable records of controlled substances.

“As opioid overdose deaths skyrocket, it is critical that health care companies are held accountable when they fail to effectively safeguard these powerful prescriptions within their facilities,” said U.S. Attorney Christopher R. Kavanaugh. “The oversight provided by this resolution will ensure future compliance involving these important but potentially deadly substances, and the United States Attorney’s Office for the Western District of Virginia will continue to vigorously pursue these cases with our federal and local partners in order to protect Virginia’s communities.”

The investigation into this matter was conducted by the Food and Drug Administration’s (FDA) Office of Criminal Investigations, the Drug Enforcement Administration’s (DEA) Roanoke Resident Office Diversion Group, and Virginia State Police.

“Today’s settlement sends a clear message to all registrants that it is essential to maintain effective controls to prevent the diversion of controlled substances,” DEA Washington Division Special Agent in Charge Jarod Forget said in Wednesday’s statement. “DEA is dedicated to combat the prescription drug abuse problem in Virginia and throughout the country and to hold all DEA registrants accountable.”

“The FDA oversees the U.S. drug supply to ensure that patients receive medicines that are safe and effective,” said Special Agent in Charge George A. Scavdis of the FDA Office of Criminal Investigations’ Metro Washington Field Office. “We will continue to protect the public health by holding accountable health care companies that fail to safeguard their prescription drug inventory and thereby compromise their patients’ health and comfort.”

“With opioid deaths and overdoses at record-breaking highs, especially across Southside Virginia, there must be zero tolerance of trusted health professionals engaging in drug diversion,” Col. Gary T. Settle, Virginia State Police superintendent, said. “For the safety and protection of Virginia’s communities, our Virginia State Police Drug Diversion special agents, in collaboration with our local and federal public safety partners, will continue to aggressively pursue investigations related to the illegal distribution of Fentanyl and other prescription drugs.”

According to officials, this agreement resolves Sovah Health’s potential civil and criminal liability based on the investigation.

In addition to the $4.36 million settlement, officials say Sovah Health agreed in the resolution to be subject to four years of increased compliance and oversight, during which time any failure to comply with its obligations may result in contempt of court findings that could lead to additional monetary sanctions and injunctive relief. 

The DOJ tells WFXR News that Sovah Health has committed to additional compliance measures including, but not limited to, having cameras at all Automated Dispensing Machines to capture the activity of placing/removing controlled substances; promptly reporting losses and diversion of controlled substances; taking and reporting disciplinary action taken against employees found to have been responsible for theft, diversion or loss of controlled substances; maintaining a mandatory random drug testing program for employees; and conducting a full physical inventory of all federally scheduled II-V controlled substances more frequently than required by law.