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BOSTON (Reuters) - The pharmacy tied to a deadly U.S. meningitis outbreak fended off discipline from health regulators in 2006 that could have fatally damaged the company's reputation and put it out of business, records released on Monday revealed.
The Massachusetts-based New England Compounding Center (NECC) faced three years of probation and a public reprimand amid allegations that the pharmacy violated accepted standards for compounding methylprednisolone acetate, the same steroid that is linked to the current fungal meningitis outbreak. Twenty-three people have died and nearly 300 have been infected after receiving the steroid treatment made by NECC.
The proposed discipline, outlined in a 2004 letter from the Massachusetts Board of Registration in Pharmacy, is detailed in documents obtained by Reuters through a Freedom of Information Act request.
NECC's attorney, Paul Cirel, recognized the impact of a public reprimand and pleaded with regulators at the time not to resolve the complaint with a disciplinary sanction, records show.
"The collateral consequences to many, if not all of NECC's 42 other licenses, would be potentially fatal to the business," Cirel said in a November 11, 2004, letter to the pharmacy board, referring to the company's licenses in other states. "Such a catastrophe is clearly not the intended result of the proposed reprimand, nor is it warranted in this case."
A footnote at the bottom of Cirel's letter reads, "Once disclosed, the reprimand surely will result in inquiries/investigations in those other jurisdictions. Regardless of the derivative actions taken, the attendant legal and administrative costs will be devastating."
Two years later when the case was finally resolved, NECC escaped discipline. The initial proposal for punishment was three years of probation and a public reprimand, records show.
The 2006 settlement was a "nondisciplinary agreement" with the pharmacy board and the U.S. Food and Drug Administration, records show. But it did require NECC to improve its standards and hire an outside firm to evaluate its facility and procedures.
"New England Compounding Center worked cooperatively with the Massachusetts Board of Registration in Pharmacy to resolve to the Board's satisfaction any issues brought to the company's attention," NECC said in a statement on Monday.
Meanwhile, the Massachusetts Executive Office of Health and Human Services said Monday evening that it is investigating the 2006 settlement.
"As part of our active investigation into NECC, we are looking at the events surrounding the signing of the consent agreement," Alec Loftus, a spokesman for the department said. "This consent agreement was signed under the previous administration and it is troubling to say the least."
Reporting by Tim McLaughlin and Toni Clarke; Editing by Lisa Shumaker