Ex-pharmacy employees' appeal in meningitis case raises industry practice issue

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A sign for pharmaceutical compounding company New England Compounding Center, in Framingham, Massachusetts October 8, 2012. REUTERS/Jessica Rinaldi

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(Reuters) - Federal appellate judges on Wednesday questioned whether they potentially would be declaring illegal the ability of pharmacies to prepare compounded drugs in advance for hospitals if they upheld the convictions of two ex-employees of the facility behind 2012's deadly fungal meningitis outbreak.

Judges on the 1st U.S. Circuit Court of Appeals in Boston raised those concerns as two ex-employees of New England Compounding Center appealed their convictions for filling prescriptions for fake patients like "Harry Potter" and "Tony Tiger."

Kathy Chin and Michelle Thomas were convicted in 2019 in the fourth trial to result from the indictment in 2014 of 14 owners and former employees of the now-defunct company, which produced mold-tainted steroids that caused the fungal meningitis outbreak.

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Prosecutors said the contaminated drugs the Framingham, Massachusetts-based facility produced were shipped to hospitals and clinics nationally and sickened 793 people who were injected with them. More than 100 of them have died.

Chin and Thomas were not charged over the contaminated drugs but were charged helping it dispense drugs in bulk without valid prescriptions.

State-regulated compounding pharmacies like the New England facility are supposed to produce customized drugs pursuant to patient-specific prescriptions to address individual needs.

Prosecutors said that the compounding center, to get around the prescription requirement and ship drugs in bulk, processed orders from hospital customers nationally based on prescriptions that had fake patient names.

Lawyers for Chin and Thomas argued that while they were licensed pharmacists, they were not legally dispensing drugs at the compounding center, where they worked in the shipping department checking drug orders destined for hospitals.

Joan Griffin, Chin's lawyer, argued their jobs were limited to reviewing a check list before approving orders to be shipped to the center's customers and that no evidence was presented at trial showing they actually saw the forms with the fake names.

"That trial made it clear that their jobs did not include that responsibility," she said.

U.S. Circuit Judge Sandra Lynch responded that based on documents and testimony that prosecutors presented at trial, "the jury seems to have had an adequate basis in the evidence for the conclusion that it reached."

But she and U.S. Circuit Judge David Barron raised concerns about whether by sustaining their convictions for misbranding drugs under the federal Food, Drug and Cosmetic Act they would be declaring unlawful a broader industry practice.

"There's no such thing as anticipatory compounding without a valid prescription," Barron said.

Lynch, noting that hospital emergency rooms need to stock drugs in anticipation of patients coming in, questioned whether a ruling for the government would bar pharmacists from preparing drugs for patients whose names would only become known later.

"Under your theory of case, is it a misdemeanor?" she asked Assistant U.S. Attorney Randall Kromm. "I think your answer would have to be yes."

Kromm said he was "hesitant" to answer and asked for time to allow the U.S. Justice Department to consult with the Food and Drug Administration before responding in a later court filing.

The case was the latest concerning the outbreak to reach the 1st Circuit.

Jurors in two trials in 2017 convicted New England Compounding Center cofounder Barry Cadden and supervisory pharmacist Glenn Chin, Kathy Chin's husband, of racketeering and fraud but cleared them of second-degree murder over the deaths of 25 patients.

The 1st Circuit last year ordered Cadden and Chin re-sentenced after they received prison terms of nine and eight years, respectively.

Thomas and Chin were sentenced to one and two years of probation, respectively.

The case is U.S. v. Chin, 1st U.S. Circuit Court of Appeals, No. 20-1050.

For U.S.: Assistant U.S. Attorney Randall Kromm

For Kathy Chin: Joan Griffin

For Thomas: Michael Bourbeau of Bourbeau & Bonilla

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