Opposition hits PetMed Express from all sides; board to rule

Tampa, Fla.-As the PetMed Express scripting saga winds down with state healath officials, the online drug retailer faces new opponents, and this time, they're the federal and civil kind.

On April 16, PetMed Express went before the Florida Board of Pharmacyarmed with a deal backed by health department prosecutors regarding 36 countsof alleged illegal prescription drugs sales. The charges stem from veterinariancomplaints, all of which contend the company sells prescription medicationsto customers without proper authorization.

The deal doesn't force the company to admit or deny charges, but paynearly $36,000 in investigative costs and $40,000 in administrative fines- just $10,000 more than PetMed Express settled to in 1999 when prosecutedon nearly identical charges. Shadowed by a year of probation and 200 hoursof community service, the company also must promise not to illegally dispensedrugs in the future.

The Board of Pharmacy will judge the deal's equity following scheduledtestimony from company Chief Executive Officer Menderes Akdag. Its approvalwould negate all related complaints against PetMed Express filed beforethe April hearing, including those not addressed in the health department'sstipulation.

Health department prosecutors and Pharmacy Board Executive Director Dr.John Taylor declined to comment before the hearing. The board is expectedto regard this case as PetMed Express' second alleged offense.

On a new front

In the meantime, going head-to-head with Florida officials could be theleast of Akdag's worries. On charges the company sold foreign-labeled versionsof flea and tick control products in the United States, the EnvironmentalProtection Agency (EPA) recently fined PetMed Express $100,000, which thecompany must pay by year's end.

The fine, based on a number of alleged violations, came as part of asettlement between the agency and PetMed Express, EPA attorney Alan Dionsays. Under the agreement, the company isn't forced to admit the charges,but Dion claims EPA officials had evidence to show a number of shipmentsof misbranded products were made from Australia, a country using metricmeasurements.

Drug sales marketed with foreign labels violate the Federal Insecticide,Fungicide and Rodenticide Act (FIFRA).

"I think they were getting the products cheaper in Australia,"Dion says. "You can draw your own conclusion from there."

When contacted by DVM Newsmagazine, Akdag refused to discuss the case except to say the EPA settlement was a "business decision" and the company "would like to move past the allegations."

Civil litigation

In March, pharmaceutical manufacturer Novartis Animal Health, Inc., filed an action against PetMed Express in U.S. District Court, accusing the retailer of numerous violations, including trademark infringement and false advertising.

Also named as defendants are Internet pharmacies Savemax Inc. and Drs.Fosters and Smith, Inc. Savemax operates from the same Pompano Beach facilityas PetMed Express.

The charges are similar to the EPA's, accusing PetMed Express and othersof selling Novartis products with foreign labels to U.S. customers. EricPomerantz, vice president of general counsel, says he's not sure how theonline retailers acquire Novartis drugs since the company won't supply them.The company received tips from customers regarding the illegal sales.

"When they sell mislabeled products in the United States, they'rebreaking the law; these drugs don't have the right directions for use orpoison control numbers," Pomerantz says. "Clearly, we don't supplyto PetMed Express, so it's likely that veterinarians buy from us and turnaround to resell it to them."

Akdag refused to address this case.

FDA looms

But before Novartis sued, it first filed a complaint with the U.S. Foodand Drug Administration (FDA), which oversees pharmaceuticals as the EPAregulates flea control products.

That was almost seven months ago. Pomerantz says he hasn't heard back.

"The problem with the FDA is they don't tell you if they're goingto do anything," he says. "That's why we filed the lawsuit. Numberone, we want (the companies) to stop doing this."

As expected, FDA spokeswoman Linda Grassie couldn't confirm or deny anyongoing investigations, but advises to keep watch.

At the same time, Akdag says he's tired of finding his company in thecrosshairs of regulators.

"There's got to be light at the end of this tunnel," he says."These things happened in the past, and I can say now that we're in100 percent compliance. We unconditionally guarantee the medications wesell." M