Case 4:06-cv-02034

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IN THE UNITED STATES DmTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DNISION
)
UNITED STATES OF AMERICA,
)
Plaintiff,
)
)
v.
)
)
Articles of drug consisting of bulk
)
repacked chemical pharmaceutical
)
)
components of various lot numbers
)
***
ENROFLOXACIN
)
)
Civil Action No. H-06-2034
***
POLIDOCANOL [ORPOLYOXYLLAURYL
Admiralty
)
ETHER NF (9)]
)
)
***
)
DOMPERIDONE BP
)
***
)
INSULIN USP BEEF (POWDER):
)
Defendants
)

CONSENT DECREE OF CONDEMNATION AND DESTRUCTION
WHEREAS, on June 14, 2006, the United States of America ("Plaintiff''), by and
tbmugh the United States Attorney for the Southern District of Texas, filed a verified
Complaint ("Complaint') in this Court against the above-captioned articles ("Articles");
WHEREAS, the United States Marshal for this District seized the Articles
pursuant to a Warrant of Arrest in Rem issued by this Court;
WHEREAS, on July 12, 2006, Professional Compounding Centers of America,
L.P. ("PCCA" or "Claimant") intervened and filed a statement of interest in all of the
Articles, and on July 31, 2006, filed an Answer;

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WHEREAS, on January 2, 2007, this Court granted the patties' joint motion "to
stay this case pending the final outcome of Medical Center Pharmacy, et al., v. Gonzales,

et c,rl. (Fifth Circuit Court of Appeals No. 06-51583);"
WHEREAS, on July 31, 2008, this Court granted the patties' joint motion to
reinstate the case, extend the stay, and administratively reclose the case to clarify that the
stay extended through the period for filing petitions for certiorari with the United States
Supreme Court in Medical Center Pharmacy;
WHEREAS, on February 27, 2009, the time period for filing a petition for
certiorari for the Fifth Circuit Court of Appeals decision in Medical Center Pharmacy
expired without any petitions being filed;
WHEREAS, Claimant affirms that it is the sole owner of the Articles, that no
other person has an interest in the Aiiicles, and that it will indemnify and hold Plaintiff
harmless should any party or pa1ties hereafter file or seek to file a statement of interest, or

to intervene in this action and obtain or defend any part of the Articles subject to this
De1;;ree;
WHEREAS, Claimant, without admitting or denying the allegations in the
Complaint, now consents to the entry of this Consent Decree without contest and before
any testimony has been taken; and
WHEREAS, Plaintiff consents to the entry of this Consent Decree, and the Court
being fully advised of the basis thereof, it is now ORDERED, ADJUDGED, AND
DECREED as follows:
1.

This Court has jurisdiction over this action pursuant to 28 U.S.C. § 1345

and 21 U.S.C. § 334.

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2.

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The Atiicles are drugs that have remained under seizure since June 14,

2006. The Complaint alleges that the Articles are misbranded drugs within the meaning
of the Federal Food, Drug, and Cosmetic Act ("the Act"). The expiration dates for the
Axticles have passed.
3.

The Articles are hereby condemned pursuant to 21 U.S.C. § 334, and

forfeited to Plaintiff.
4.

Pursuant to 21 U.S.C. § 334(e), Claimant shall pay to the United States all

comt costs and fees, storage, and other proper expenses to date, and such additional
expenses as may hereinafter be incurred and taxed.
5.

Within fifteen (15) days of the entry of this Consent Decree, Claimant

slrnll: (a) pay in full the court costs, storage, and other proper expenses of this proceeding
incurred to date, as set fo1ih in paragraph 4 of this Decree; and (b) execute and file with
the: Clerk of this Court a good and sufficient penal bond in the amount of fifty-five
thousand dollars ($55,000.00). Claimant shall satisfy the requirement of posting a penal
bond by depositing fifty-five thousand dollars ($55,000.00) into the registry of this Comt.
The funds shall be deposited in accordance with Rule 67 of the Federal Rules of Civil
Procedure, and applicable statutes and local rules. The Clerk of Court shall deposit the
funds in an interest bearing account and shall deduct from the account any fee authorized
by the Judicial Conference of the United States.
6.

After paying the costs pursuant to paragraph 4 and depositing the funds

into the registry of this Court pursuant to paragraph 5, Claimant shall give written notice
to FDA at the Dallas District Office, U.S. Food and Drug Administration, 4040 North
Central Expressway, Dallas, Texas 75204, that Claimant, at its own expense, is prepared

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to destroy the Aiticles, pursuant to 21 U.S.C. § 334, under the supervision of a duly
authorized representative(s) of the United States Department of Health and Human
Services ("FDA representative''). Claimant's notice: shall specify the proposed time,
pllace, and method of destruction of the Articles.
7.

Claimant shall not commence attempting to destroy the Articles until

Claimant has received written authorization from an FDA representative to commence
the destruction. All A.liicles shall be destroyed at Claimant's expense under the
supervision of an FDA representative. Claimant shall pay to the United States all costs
incurred in supervising the destruction of the Articles, at the rates specified in paragraph
13 of this Decree.
8.

Following receipt of notice from FDA that Claimant has paid the costs

pursuant to paragraphs 4 and 5, deposited the funds into the registry of this Court
pursuant to paragraph 5, and submitted notice to FDA pursuant to paragraph 6, and that
FDA has issued the written authorization pursuant to paragraph 7, the United States

Marshal for this District shall release the Articles from his custody to the custody of
Claimant for the sole purpose of destroying the Articles.
9.

Claimant shall not destroy or dispose: of, permit another person to destroy

or dispose of, or cause another person to destroy or dispose of the Articles or any part of
the Articles in a manner contrary to the provisions of the Act, or other laws of the United
States, or of any State or Territory (as defined in the Act) in which they are disposed of.
10.

Claimant shall at all times, until the A1iicles have been destroyed, retain

the Articles intact for examination or inspection by an FDA representative, and shall

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maintain the records or other proof necessary to establish the identity of the Articles to
the satisfaction of the FDA representative.
11.

Within sixty (60) days of entry of this Decree, provided that an FDA

representative is able to be present on the destruction date provided by Claimant pursuant
tc Paragraph 6, Claimant shall complete the destrudon of the Articles under the
supervision of FDA. Within fifteen (15) days of Claimant's completion of the
d1~struction

of the Articles, FDA will send Claimant an invoice for the costs of

supervising such destruction, and Claimant shall pay those costs within ten (10) days of
re:ceiving FDA's invoice.
12.

The United States Attorney for this District, upon being advised by an

FDA representative that the A.Iticles have been dest::·oyed in compliance with this Decree
and the law and that Claimant has paid all costs as of that date, will transmit such
information to the Clerk of this Couii, whereupon the funds deposited in the registry of
this Comt shall be returned upon the Comt's order.
13.

Claimant shall reimburse the United States for the costs of supervising

Clnimant's compliance with the terms of this Decre·e, including all inspections,
examinations, reviews, evaluations, and analyses conducted pursuant to this Decree, at
the standard rates prevailing at the time the activities are accomplished. As of the date
this Decree is signed by the parties, these rates are: $85 .49 per hour and fraction thereof
p er representative for inspection work; $102.49 per hour and fraction thereof per
1

representative for analytical work; $0.585 per mile for travel expenses; the government
rate or equivalent for travel by air; and the published government per diem rate or the
equivalent for the areas in which the inspections am performed per day, per represent-

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tative, for subsistence expenses where necessary. In the event that the standard rates
generally applicable to FDA supervision, inspection, review, examination, or analysis are
modified, these rates shall be increased or decreased. without further order of the Comi.
14.

If Claimant fails to abide by and perform all of the terms and conditions of

this Decree, then the funds deposited in the registry of this Court pursuant to paragraph 5
of this Decree shall, on motion of Plaintiff in this proceeding, be forfeited in its entirety
to Plaintiff and judgment entered in favor of Plaintiff. If Claimant breaches any te1m or
condition of this Decree, then Claimant, at its own expenses, shall immediately retum the
Aiticles to the United States Marshal for this District or otherwise dispose of them
pursuant to an order of this Comt. In the event that return of the Articles becomes
necessary pursuant to this paragraph, Claimant shall be responsible for all costs of storage
and disposition that are incurred by Plaintiff.
15.

With regard to the Articles that are the subject of the seizure, Claimant

sha.ll abide by the decisions of FDA, which shall be final. All decisions shall be vested in
the discretion of FDA. When contested by Defendants, FDA decisions shall be reviewed
by the Couit under the arbitrary and capricious standard, 5 U.S.C. § 706(2)(A). Review
slrn1ll be based exclusively on the written record before FDA at the time the decision was
made, and no discovery shall be taken by either patty.

16.

This Court retains jurisdiction to issi:e such further decrees and orders as

may be necessary to the proper disposition of this proceeding.
SO ORDERED:

Dated this 21. IL:iay

of~~ 2009. -1'-4 >It®----~
LEE H. ROSENTHAL
-------UNITED STATES DISTRICT JUDGE

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V.fo hereby consent to the entry of the foregoing:

FOR CLAIMANT:

FOR PLAINTIFF:

By:/yS~~
L. D YID SPARKS

~reffH.g United

TIM: JOHNSON
States

Pr(:sident and Chief Executive Officer
o:r1 behalf of Professional Compounding
Centers of America, L.P.

4.~y:

B~~~
r:
OROUGH

TE
State Bar No. 7716000
Southem District of Texas Bar No. 18670
Hance, Scarborough, Wright,
Woodward & Weisbart
111 Congress Avenue, Suite 500
Austin, Texas 78701
(512) 479-8888

OP cq(iN);EL:

j ~

---+---1--------':::0......--

( JOSE VELA, JR.
Assistant United tates Attorney
Federal l.D. No. 5492
Texas State Bar, o. 24040072
P.O. Box 61129
Houston, Texas 77208
(713) 567-94J.)0
OF COUNSEL:
DAVID S. CADE
Acting General Counsel

.

~a,Q d. r~

By:
HYMAN, PHELPS & MCNAMARA, P.C.
700 Thhteenth Street, N.W., Suite 1200
Washington, D.C. 20005
(202) 737-7542

MICHAEL M. LANDA
Acting Associate General Counsel
Food and Drug Division
BRIC M. BLUMBERG
Deputy Chief Counsel, Litigation

JEFFREY N. GIBBS
D.C. Bar No. 385294
Pro Hae Vice

KAREN E. SCHIFTER
Associate Chief Counsel, Litigation
Dept. of Health & Human Services
Office of the General Counsel
5600 Fishers Lane
Rockville, Maryland 20857
(301) 827-1152

DOUGLAS B. FARQUHAR
D.C. Bar No. 386573
Pro Hae Vice
:F1AUL L. FERRARI
D.C. Bar No. 455213
Pro Hae Vice

ATTORNEYS FOR PROFESSIONAL
COMPOUNDING CENTERS OF AMERICA

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