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Pharmacy Distribution of Controlled Substances

Pharmacy Distribution of Controlled Substances

RELATED LINKS 

For additional resources to support pharmacy controlled substance distribution and losses compliance click HERE. 

 

FULL ARTICLE: 

Pharmacies may distribute controlled substances to other authorized registrants under specific conditions. These activities must be carefully managed to ensure compliance with federal and state laws, maintain accurate records, and prevent diversion. 

 
The Five Percent Rule 

Pharmacies registered to dispense controlled substances may distribute limited quantities without registering as a distributor, provided they comply with the Five Percent Rule: 

  • The receiving entity (pharmacy or prescriber) must be properly registered under the Controlled Substances Act (CSA).  
  • The total number of controlled substance dosage units distributed must not exceed 5% of the total number of dosage units dispensed by the pharmacy in a calendar year.  
  • Distribution of Schedule II controlled substances requires a DEA Form 222.  

If a pharmacy exceeds or anticipates exceeding this 5% threshold, it must register with the DEA as a distributor. 

 
 

Common Distribution Scenarios 

Controlled substance distribution may occur in the following situations: 

  • Pharmacy-to-pharmacy transfers  
  • Pharmacy-to-prescriber transfers for the purpose of general dispensing to patients  

All such distributions must comply with federal and state regulations. 

 
 

Documentation and Recordkeeping Requirements 

Accurate documentation is critical for all controlled substance distributions. Pharmacies must generate and maintain a detailed invoice or record for each transaction. 

Each distribution record must include: 

Supplier and Purchaser Information 

  • Name (as listed on DEA registration)  
  • Address (as listed on DEA registration)  
  • DEA registration number  

Controlled Substance Details 

  • Drug name  
  • Dosage form (e.g., 10 mg tablet)  
  • National Drug Code (NDC)  
  • Number of dosage units (e.g., 100-count bottle)  
  • Number of containers distributed  

Additional requirements: 

  • Schedule II distributions require a completed DEA Form 222  
  • All invoices and DEA Form 222 records must be maintained in a readily retrievable manner for at least 2 years  

 
 

Suspicious Orders Monitoring 

Pharmacies must remain vigilant in identifying suspicious orders, including unusual quantities or patterns of distribution. 

  • Any suspicious order must be reported through the Suspicious Orders Reporting System (SORS)  
  • For Schedule II distributions, DEA Form 222 records must be submitted to the DEA by the end of the month in which the transaction occurred  

 
 

Monitoring Compliance with the Five Percent Rule 

Ongoing tracking is essential to ensure compliance: 

  • Maintain a monthly running total of:  
    • Controlled substance units distributed  
    • Controlled substance units dispensed  
  • Use the following formula to calculate compliance:  

 
Percent Distributed=(Units Distributed / Total Units Dispensed)×100 
  

  • If the percentage approaches 5%, the pharmacy must:  
    • Immediately stop distributing controlled substances OR  
    • Register with the DEA as a distributor  

 
 

Best Practices 

  • Regularly audit distribution records for accuracy and completeness  
  • Maintain organized, readily retrievable documentation  
  • Monitor distribution trends monthly  
  • Train staff on identifying and reporting suspicious orders  
  • Ensure compliance with both federal and state-specific requirements  

Maintaining strict controls over controlled substance distribution helps protect the integrity of the supply chain and reduces the risk of diversion. 

 

Disclaimer: These tools and templates are intended for general informational purposes and are provided by Montana Family Pharmacies as a service to pharmacies. While we try to keep the information timely and accurate, we make no guarantees. These tools and templates are not a substitute for legal, regulatory, or professional advice. 

Policies and procedure, templates, checklists, and other tools should be customized to fit the specific needs and regulatory requirements of your pharmacy. 

Montana Family Pharmacies disclaims any liability for any damages, losses, or other consequences arising from the use or reliance on the tools or policy templates.