Alabama Lawmakers Demand Urgent Reforms from State Pharmacy Board After Troubling Audit Report

Alabama Lawmakers Push State Pharmacy Board to Fix Problems After Concerning Audit

Alabama lawmakers have told the State Board of Pharmacy to quickly address serious problems found in a recent audit by the Examiners of Public Accounts. The Legislature’s Sunset Committee, which reviews the activities of state boards, held a public hearing on Thursday to discuss the report, which covered the Board of Pharmacy’s operations from October 2019 to September 2023.

The audit found 14 major issues with the board, including collecting fines in ways that are not allowed by law, incorrectly reporting the amount of fines collected, and not following the state’s open meetings law. Senator Keith Kelley, R-Anniston, expressed deep concern, calling the findings “extremely, extremely, extremely troubling.” Another lawmaker, Senator Sam Givhan, R-Huntsville, said it was one of the worst reports he had seen and urged the board to act quickly to fix the problems.

Donna Yeatman, the executive secretary of the board and a pharmacist, said that the board is already making changes in response to the audit.

During the hearing, five people, including two attorneys who have represented pharmacists before the board, criticized the board’s actions. However, several others, including two pharmacists, spoke in support of the board.

The State Board of Pharmacy has five members, all of whom are pharmacists. Three members are appointed by the governor, and two are elected by pharmacists. The board, along with its 24 staff members, is responsible for licensing and regulating pharmacists and the pharmacy industry in Alabama.

The most concerning issues in the audit were related to how the board collects fines and reports its revenue. The audit found that the board was entering deferral agreements with licensees accused of violations. These agreements allowed the board to collect administrative costs that were sometimes double the normal fines. If the costs were paid without further violations, the charges would be dismissed and not recorded on the licensee’s record.

Representative Matt Simpson, R-Daphne, who is also a prosecutor, criticized these deferral agreements, saying they gave the impression that wrongdoing by licensees could be hidden. The audit also found that the board collected fines and penalties in excess of what the law allows.

The audit revealed that from 2020 to 2022, the board reported fines and penalties totaling between $575,000 and $681,000. However, in 2023, this amount dropped sharply to $195,000, a 71% decrease, while "miscellaneous income" increased by 594%. This shift in how revenue was reported created an inaccurate picture of the board’s collections.

Attorney Joseph Kreps from Birmingham accused the board of trying to hide the true amount it was collecting in fees. He said the board refused to provide information on deferral agreements when he requested it through public records.

Yeatman explained that the change in revenue reporting was due to a new attorney who categorized the money differently. She acknowledged that the board should have been clearer in how it reported these funds.

Another issue in the audit was the board collecting fines from entities not yet licensed in Alabama. State law only allows the board to issue charges to active licensees. Representative Kerry Underwood, R-Tuscumbia, questioned Yeatman about this practice, saying it created a bad appearance of a “pay-to-play” system.

Yeatman defended the board's actions, saying they were meant to protect the public by ensuring that entities were qualified to operate in Alabama.

The audit also found that the board failed to properly document its actions in many cases. The minutes from 53 out of 60 meetings did not reflect official decisions, and the board often went into closed sessions without recording the purpose, as required by law.

Despite these issues, several people praised the board for its proactive efforts, especially during the COVID-19 pandemic. Pharmacist James Jones from Prattville said he had confidence in the board’s integrity and believed they were driven by a strong moral compass to do what’s right.

Representative Simpson emphasized the need for the board to operate more transparently, especially given its important role in addressing major health issues like mental illness and the opioid crisis. Yeatman agreed and said the board would make necessary changes and follow up with the Public Examiners.