West Virginia Record

Wednesday, October 23, 2019

Rite Aid agrees to pay $4 million in settlement

By Kyla Asbury | Jan 24, 2018

CHARLESTON – Rite Aid Corporation has agreed to pay $4 million in a settlement after a criminal investigation into its improper sale of pseudoephedrine occurred.

The U.S. Attorney’s Office issued a press release stating that the money paid out by Rite Aid would stay in West Virginia.

“This settlement sends a strong message to businesses that we will not tolerate putting sales over safety,” said U.S. Attorney Michael Stuart. “Most significantly, every dollar paid out by Rite Aid is going to stay right here in West Virginia, and not go into the black hole of Washington.”

Stuart said the funding will provide increased resources for two critical areas — compensating crime victims and drug treatment.

“Rest assured that my office will keep fighting to ensure that anyone responsible for the drug scourge in our state is held responsible, from the suppliers to the pharmacies to the street dealers poisoning our communities,” Stuart said.

Rite Aid’s improper sales happened between January 2009 and October 2012 in the southern district of West Virginia.

The $4 million dollar pay back is about 80 percent of Rite Aid's gross sales of pesudoephedrine in West Virginia during that time period.

“Regulation of drugs such as pseudoephedrine is critical to improving West Virginia’s substance abuse epidemic,” said Bill J. Crouch, Cabinet Secretary of the West Virginia Department of Health and Human Resources. “This funding will support DHHR’s ongoing efforts to strengthen substance abuse treatment programs and ultimately improve the health and well-being of impacted residents across the state.”

DEA’s Assistant Special Agent in Charge David W. Gourley said that even though the opioid crisis has been in the forefront, they will not neglect any investigations of other dangerous drugs which are readily available in the state of West Virginia.

“Methamphetamine use is on the rise,” Gourley said. “This is a reminder to pharmacies out there not to turn a blind eye to their responsibilities under the Controlled Substances Act.”

Per the settlement, Rite Aid must pay $2.6 million to the West Virginia Crime Victims Compensation Fund, which is more than double the total federal grants the Fund receives in an entire year, and is just shy of the total amount of money the Fund paid to crime victims in all of 2016 and 2017 combined.

Aaron Allred of the West Virginia Legislature said they are grateful to the U.S. Attorney’s Office for including the West Virginia Crime Victims Compensation Fund as a recipient of the settlement.

“These funds will allow us to assist even more West Virginians as they try to rebuild their lives after being innocent victims of crime,” Allred said. “These funds will be used to pay medical bills, provide medical devices, pay for burial and funeral services, lost wages, counseling and other economic losses sustained by victims of crime in our state.”

The settlement further requires Rite Aid to pay $1.4 million to the West Virginia Department of Health and Human Resources.

As a condition of his agreement to this settlement, Stuart required the agreement of DHHR to use the funding for substance abuse treatment to help fight addiction.

“I want to strongly commend the DEA, assisted by the FBI, and the tremendous work of our team and the leadership of AUSAs Steve Loew and Greg McVey, who handled this complex case for the U.S. Attorney’s Office,” Stuart said. “Job well done.”

During the investigation, Rite Aid has taken remedial actions to comply with federal law and to help ensure that pseudoephedrine is sold only to people who have a legitimate need for it.

The agreement requires Rite Aid to continue those remedial steps and to take additional action.

Rite Aid will now train its employees on how to identify people who may be purchasing pseudoephedrine to manufacture methamphetamine, and it will further train and instruct its employees to deny such sales.

Rite Aid will also continue requiring stores in West Virginia to store pseudoephedrine products out of the view of customers to make it easier and safer for store employees to deny suspicious sales, and Rite Aid will require pharmacists to counsel all customers seeking to purchase pseudoephedrine.

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U.S. Attorney's Office for the District of Southern West Virginia