Judicial Council of California Issues Opinion in Kenneth S. Bradley Vs. CVS Pharmacy Case

SACRAMENTO, California, May 29 (TNSsro) -- The Judicial Council of California issued the following opinion (No. B308040):

KENNETH S. BRADLEY et al., Plaintiffs and Appellants, v. CVS PHARMACY, INC., et al., Defendants and Respondents.

APPEAL from an order of the Superior Court of Los Angeles County. Mark V. Mooney, Judge. Affirmed with directions.

Fleming Law Firm and J. Patrick Fleming, Jr. for Plaintiffs and Appellants.

Spertus, Landes & Umhofer, James W. Spertus and Elizabeth A. Mitchell for Defendants and Respondents.

Kenneth S. Bradley and his medical corporation, Southern California Pain Consultants, Inc. (collectively, Bradley) appeal from an order denying Bradley's motion for a preliminary injunction against respondents CVS Pharmacy, Inc., Longs Drug Stores California LLC (Longs), Garfield Beach CVS, LLC (Garfield), and Autumn Miller (collectively, CVS)./1

Bradley is a doctor who specializes in pain management. In June 2020, CVS stopped filling Bradley's prescriptions for controlled substances for his patients, citing concerns about his prescribing patterns. Bradley sued CVS and then sought a preliminary injunction to require CVS to fill his prescriptions.

The trial court denied the injunction on several grounds, including the conclusion that Bradley should have first sought relief from the California State Board of Pharmacy (Board). The Board is charged with the responsibility of enforcing state rules governing pharmaceutical licensees. (See Bus. & Prof. Code, Sec. 4001, subd. (a).)/2

The trial court based this conclusion on the doctrine of exhaustion of administrative remedies. We affirm the trial court's ruling on an alternative but closely related ground. The trial court's decision to deny the preliminary injunction and to stay the action pending review by the Board is supported by the doctrine of primary jurisdiction.

The Board has primary jurisdiction to consider the particular statutory obligations underlying Bradley's injunction motion. Bradley's claim that CVS has an obligation to fill his prescriptions rests primarily on Business and Professions Code section 733, which provides in part that a "licentiate shall not obstruct a patient in obtaining a prescription drug or device that has been legally prescribed or ordered for that patient." (Id., Sec. 733, subd. (a).) The Board is empowered to issue fines and "orders of abatement" for violations of that section. (Id., Sec. 4314, subd. (a).) The Board is also charged with the responsibility to remedy unprofessional conduct by licensees. (Id., Sec. 4301.) Such conduct includes the "clearly excessive furnishing of controlled substances" in violation of a pharmacist's responsibility to ensure that prescriptions for controlled substances are issued only for a legitimate medical purpose. (Bus. & Prof. Code, Sec. 4301, subd. (d); Health & Saf. Code, Sec. 11153, subd. (a).)

Thus, the trial court correctly recognized that an order requiring CVS to honor particular prescriptions would involve judgments concerning the statutory obligations of pharmacists that the Board is both expected and equipped to resolve. The Board is also empowered to issue an abatement order, if warranted, that would perform the equivalent role of an injunction in providing the relief that Bradley seeks. The trial court therefore reasonably ruled that Bradley should first seek relief from the Board before pursuing his claims in court.

BACKGROUND

1. Bradley's Practice

Bradley is a licensed physician with 26 years of experience in his own practice and as an officer in the Army Reserve. He specializes in the "treatment and management of pain." His patients include persons who experience chronic pain from conditions such as cancer, surgeries, and degenerative disk disease.

Bradley's practice primarily serves patients from health maintenance organizations (HMO's). He has referral relationships with about 30 HMO's in the Los Angeles area. Most of Bradley's patients are minorities who receive medical insurance through Medicare or Medi-Cal.

Bradley's pain management treatment often includes prescriptions for controlled substances, including opiates such as oxycodone, hydrocodone, and morphine. Bradley is licensed to prescribe these medications. According to Bradley, most of his patients fill their prescriptions at their local CVS pharmacies.

2. CVS's Decision Not to Fill Bradley's Controlled Substance Prescriptions

In 2018 and 2019 CVS contacted Bradley to ask him about increases in his prescriptions for Norco (a hydrocodone). Bradley explained to CVS that Norco is a low potency opiate and therefore has a "lower potential for overdose while still controlling pain." CVS took no action after these communications.

In April 2020, Miller contacted Bradley and introduced herself as a pharmacist at a CVS pharmacy in Carson. According to Bradley, Miller told him that she would not fill Bradley's prescriptions unless he provided plans for his patients to "taper off their opiate medications." Bradley explained his office procedures and his practice of using "great caution when prescribing opiates." However, Bradley "refused to comply with Ms. Miller's demand that I create plans to reduce and ultimately eliminate the dosage levels of opiate medications that I had concluded are necessary for my patients." After that conversation, Miller adopted a policy of refusing to fill Bradley's controlled substance prescriptions in the pharmacy where she worked.

In May 2020, a CVS senior manager wrote Bradley a letter concerning CVS's review of Bradley's "prescription dispensing records." The letter stated that, "[b]ased on our data we have identified that your controlled substance prescribing may be outside the normal range in comparison with other prescribers in your specialty and geographic region." The letter requested an opportunity to speak with Bradley to "obtain a better understanding" of Bradley's controlled substance prescriptions.

After receiving the letter, Bradley spoke with CVS representatives. The representatives had questions about: (1) Bradley's prescriptions for Norco for a majority of his patients; (2) Bradley's prescriptions for Valium; and (3) a spike in Bradley's controlled substance prescriptions during March and April of 2020. Bradley explained that his prescription options were limited by HMO requirements; Norco is a low potency opiate; and Valium is a low potency drug that is helpful for sleep. He also explained that his prescriptions spiked for several months as a result of the Los Angeles Covid-19 stay at home order. Because he was the only person in his practice who was certified to "conduct e-prescribing," he had "temporarily carried the prescription load" for the other two prescribers in his office while the office was closed.

On June 17, 2020, CVS wrote to Bradley informing him that, effective June 25, 2020, "CVS/pharmacy stores will no longer be able to fill prescriptions that you write for controlled substances." The letter stated that, "[d]espite our attempts to resolve the concerns with your controlled substance prescribing patterns these concerns persist."

According to CVS, it took this step based upon its "prescription monitoring program." CVS created this program in 2012 and has implemented it nationwide. The program "uses algorithms to gather aggregate data on physician prescribing practices to identify physicians who demonstrate extreme patterns of prescribing certain highly regulated drugs." Those physicians "who are flagged for high-risk prescribing activity" are then interviewed and investigated.

CVS claimed that Bradley had been flagged by its program "multiple times" since 2015 and had also been the subject of complaints by individual CVS pharmacists. CVS explained that Bradley was the top prescriber for hydrocodone "[a]mong the ten CVS locations that most frequently serve Bradley's patients." CVS also cited the fact that, between March and May of 2020, "Bradley's prescriptions increased from approximately 10,000 tabs of hydrocodone per month to almost 50,000 tabs."

3. Proceedings in the Trial Court

Bradley filed his initial complaint on June 25, 2020, followed by an amended complaint (Complaint) on July 8, 2020. Bradley's Complaint alleges claims for (1) declaratory relief, (2) unfair competition under Business and Professions Code section 17200, (3) tortious interference with contract and prospective economic advantage, and (4) civil rights violations under the Unruh Civil Rights Act (Civ. Code, Sec. 51.)/3

After the trial court denied a request for a temporary restraining order, Bradley filed his motion for a preliminary injunction on July 20, 2020. CVS opposed the injunction and demurred to Bradley's Complaint. Both CVS's opposition and its demurrer argued that the trial court should defer to the Board under the doctrines of exhaustion of administrative remedies, equitable abstention, and primary jurisdiction.

Following a hearing on September 15, 2020, the trial court denied Bradley's motion for a preliminary injunction and sustained CVS's demurrer with leave to amend. The court concluded that Bradley's claims raised issues that "should be dealt with by the Pharmacy Board." The court explained that, "[w]hether we talk about it in terms of the demurrer or the injunction, there is an administrative body that is set up to deal with this."

The trial court also found that Bradley had failed to show that he would suffer irreparable injury in the absence of an injunction. The court concluded that Bradley's alleged loss of business was compensable through damages, and that, "[i]n terms of the patients, there are other pharmacies they can go to, other doctors they can go to, if that's the concern."

After Bradley amended his Complaint, CVS again demurred. The trial court again sustained CVS's demurrer and ordered the action stayed pending consideration by the Board.

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Footnotes:

1/ Longs and Garfield are subsidiaries of CVS Pharmacy, Inc. Miller is a pharmacist with CVS who allegedly was involved in the decision by CVS to stop honoring Bradley's prescriptions that is the subject of Bradley's complaint.

2/ Subsequent undesignated statutory references are to the Business and Professions Code.

3/ Bradley's claims for tortious interference are based on the theory that CVS's refusal to honor his prescriptions damaged his business relationships with HMO's. His Unruh Act claim is based on the theory that CVS's conduct was motivated by an intent to discriminate against Bradley's low-income minority patients in favor of wealthier customers who have more lucrative insurance plans.

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Full text of the opinion is available at https://www.courts.ca.gov/opinions/documents/B308040.PDF