“I’ve practiced for decades in an impoverished region of Texas, where it’s difficult to recruit doctors. For none of this to be taken into consideration by the attorney general is a slap in the face.”
“Really painful” A court last December prohibited Elite Med, along with defendants S&B Mar- keting and Brian Bailey, Elite Med’s owner, from doing business in the state. The attorney general’s office charged the medical devices wholesaler with acquir- ing, stocking, and selling products not approved for sale in the United States. To view the attorney general’s tempo- rary restraining order against Elite Med, visit
www.oag.state.tx.us/newspubs/ releases/2011/010411elitemed_tro.pdf. A month earlier, the Harlingen physi- cian caught up in the Elite Med inves- tigation agreed to pay $86,000 in civil penalties to the state and refrain from using unapproved medical devices in the future. The attorney general’s law- suit against the physician sought more than $3 million for more than 100 al- leged violations.
Mr. Henderson says the attorney gen- eral’s office contends that a physician or distributor “need not have wrongful intent or have engaged in a ‘knowing’ violation of the statute. If you engage in the prohibited conduct, you may be prosecuted.”
The penalties under the DTPA are se-
vere. The attorney general may seek up to $20,000 per violation, plus an added penalty of up to $250,000 if the affected consumer is older than 65.
Physicians also can find themselves facing violations of the Texas Food, Drug, and Cosmetic Act. The civil penalty may not exceed $25,000 a day for each viola- tion under the act. In determining the penalty, the court considers:
• Any previous violations, • The seriousness of the violation, • Any hazard posed to the public health and safety, and
• Demonstrations of good faith by the person charged.
Mr. Henderson says physicians are vulnerable, particularly if they buy drugs
50 TEXAS MEDICINE August 2011
or devices from discount suppliers or on the Internet. “My short take on this issue is that doctors are at substantial risk for being prosecuted if they buy or use non-FDA- approved drugs or devices. … The safest way to avoid this situation is to buy from a reputable and established supplier or from the actual drug or device manu- facturer,” he said. (See “Verify Sources of Drugs and Medical Devices” opposite page.) Mr. Henderson adds doctors would be wise to examine the product upon re- ceipt. He says labeling in any language other than English is a red flag indicat- ing the product may be misbranded. In many instances, physicians attempt
to purchase drugs and medical devices in the most efficient way possible to pro- vide patients with affordable products, Mr. Henderson says. “This regulatory system warrants mod- ification, at least to the extent doctors should not be subject to these huge fines and the attendant anxiety if they are act- ing in good faith,” Mr. Henderson said.
“The physician settled the matter to bring closure and without admitting any wrongdoing. At all times, the physician fully cooperated with the state and vol- untarily quit doing business with Elite Med immediately upon learning the facts,” said his attorney, John McClen- don, of Austin.
The physician says other doctors in similar situations face the difficult po- sition of having to settle with the state agency or enduring the costly and time- consuming process of defending them- selves at trial.
“Defending myself in court would have cost hundreds of thousands of dol- lars and would have taken years. If the attorney general doesn’t like what you’re doing, you’re basically stuck having to pay the fine,” the doctor said. “As phy- sicians, we always thought our biggest concern was medical malpractice. Now we’re entering an age where as physi- cians we have to be more worried about the state regulatory agencies and the federal government taking some kind of action against us for any number of things we might do.”
The physician encourages doctors to call an experienced health care attorney if DSHS comes to inspect their offices or the attorney general contacts them. According to Mr. McClendon, the physician used synovial fluid purchased
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