Notice2022-01112
Daniel R. Nevarre, M.D.; Decision and Order
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Published
January 21, 2022
Issuing agencies
Justice DepartmentDrug Enforcement Administration
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<title>Federal Register, Volume 87 Issue 14 (Friday, January 21, 2022)</title>
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[Federal Register Volume 87, Number 14 (Friday, January 21, 2022)]
[Notices]
[Pages 3340-3343]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-01112]
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DEPARTMENT OF JUSTICE
Drug Enforcement Administration
Daniel R. Nevarre, M.D.; Decision and Order
On June 7, 2021, a former Assistant Administrator, Diversion
Control Division, Drug Enforcement Administration (hereinafter, DEA or
Government), issued an Order to Show Cause to Daniel R. Nevarre, M.D.,
(hereinafter, Applicant), of South Jordan, Utah. Order to Show Cause
(hereinafter, OSC), at 1. The OSC proposed the denial of Applicant's
application No. H21079595C for a DEA Certificate of Registration,
because the United States Department of Health and Human Services,
Office of Inspector General (hereinafter, HHS/OIG) mandatorily excluded
Applicant from participation in Medicare, Medicaid, and all Federal
health care programs for a minimum period of 10 years pursuant to 42
U.S.C. 1320a-7(a); and such exclusion ``warrants denial of
[Applicant's] application for DEA registration pursuant to 21 U.S.C.
824(a)(5).'' Id. at 2. The OSC also alleged that Applicant's
application ``contains material false statements'' and thus forms an
independent ground for denial. Id. at 2 (citing 21 U.S.C. 824(a)(1)).
The OSC alleged that on May 25, 2018, Applicant ``pled guilty to
one count of medical assistance fraud in violation of 62 P.S. Sec.
1407(a)(1), and to one count of insurance fraud, in violation of 18
Pa.C.S. Sec. 4117(a)(2).'' Id. at 1-2 (citing Commonwealth of Pa. v.
Daniel Raymond Nevarre, No. CP-11-CR-0000717-2018 (Pa. Ct. Comm. Pl.
May 25, 2018)). The OSC further alleged that, based on such conviction,
HHS/OIG ``mandatorily excluded [Applicant] from participation in
Medicare, Medicaid, and all Federal health care programs'' for a
minimum period of 10 years pursuant to 42 U.S.C. 1320a-7(a), effective
November 20, 2018. Id. The OSC therefore proposed denial of Applicant's
application based on 21 U.S.C. 824(a)(5).
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The OSC also proposed denial of Applicant's application based on 21
U.S.C. 824(a)(1), because Applicant responded ``no'' to Liability
Question 1 on his DEA application, which asks whether Applicant has
ever been excluded from participation in a medicare program. Id. The
OSC therefore proposed denial of Applicant's application because his
``failure to disclose [his] exclusion from Medicare constitutes
material falsification of [his] application for a DEA [registration].''
Id.
The Show Cause Order notified Applicant of the right to request a
hearing on the allegations or to submit a written statement, while
waiving the right to a hearing, the procedures for electing each
option, and the consequences for failing to elect either option. Id. at
2-3 (citing 21 CFR 1301.43). The OSC also notified Applicant of the
opportunity to submit a corrective action plan. OSC, at 3 (citing 21
U.S.C. 824(c)(2)(C)).
Adequacy of Service
In a signed and sworn Declaration, a Diversion Investigator
(hereinafter, DI 2) assigned to the Pittsburg District Office,
Philadelphia Field Division, stated that, on June 21, 2021, after
receiving a request from the Salt Lake City District Office to assist
with service of the OSC, he and a Narcotics Agent from the Pennsylvania
Office of the Attorney General traveled to Applicant's residential
address in Johnstown, Pennsylvania, where he ``personally served [the
Applicant] with a copy of the [OSC].'' Request for Final Agency Action,
dated November 9, 2021 (hereinafter, RFAA), Exhibit (hereinafter,
RFAAX) 3 (DI 2 Declaration), at 1-2.
The Government forwarded its RFAA, along with the evidentiary
record, to this office on November 9, 2021. In its RFAA, the Government
represents that ``neither [Applicant] nor any attorney representing
[Applicant] has requested a hearing'' or filed a written statement.
RFAA, at 2; see also RFAAX 3, at 2 & RFAAX 1, at 4. The Government
requests ``Final Agency Action denying the Application on the grounds
that [Applicant] materially falsified his Application and has been
excluded from participation in Medicare, Medicaid, and all Federal
health care programs pursuant to 42 U.S.C. 1320a-7(a).'' Id.
Based on the DI's Declaration, the Government's written
representations, and my review of the record, I find that the
Government accomplished service of the OSC on Applicant on June 21,
2021. I also find that more than thirty days have now passed since the
Government accomplished service of the OSC. Further, based on the
Government's written representations, I find that neither Applicant,
nor anyone purporting to represent the Applicant, requested a hearing,
submitted a written statement while waiving Applicant's right to a
hearing, or submitted a corrective action plan. Accordingly, I find
that Applicant has waived the right to a hearing and the right to
submit a written statement and corrective action plan. 21 CFR
1301.43(d) and 21 U.S.C. 824(c)(2)(C). I, therefore, issue this
Decision and Order based on the record submitted by the Government,
which constitutes the entire record before me. 21 CFR 1301.43(e).
A. Findings of Fact
1. Applicant's DEA Application and Former Registrations
On February 1, 2021, DEA received an application from Applicant for
a DEA Certificate of Registration as a practitioner in Schedules IIN
\1\ through V with a proposed registered address of 881 Baxter Drive,
Suite 100, South Jordan, Utah 84095. RFAAX 1 (DI 1 Declaration)
(Appendix, hereinafter, App.) 1 (Applicant's Application). Applicant's
application was assigned Control No. H21079595C. RFAAX 1, at 1.
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\1\ Applicant only applied for schedule II non-narcotic (IIN).
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DI 1 submitted a Declaration, dated September 13, 2021, which
stated that Applicant had previously surrendered for cause DEA
Certificates of Registration numbered FN7029487 and BN5130290 on
September 5, 2018, and October 15, 2018, respectively, after losing his
state authority to practice medicine in Pennsylvania. RFAAX 1 (DI 1
Declaration) at 2. DI 1 further stated that Applicant's third previous
DEA Certificate of Registration numbered FN5716420 in New York expired
on October 31, 2018. Id. at 2-3.
2. Applicant's Exclusion (21 U.S.C. 824(a)(5))
The Government's uncontroverted evidence demonstrates that
Applicant pled guilty to false information/claims and insurance fraud
on or about May 25, 2018, in the Court of County Pleas in Cambria
County, Pennsylvania. RFAAX 1, at App. C (Applicant's Guilty plea). In
a letter from the HHS/OIG, dated October 31, 2018, HHS excluded
Applicant from Medicare, Medicaid, and all federal health care programs
under 42 U.S.C. 1320a-7(a) for a minimum period 10 years based on
Applicant's conviction. RFAAX 1, App. E (hereinafter, HHS Exclusion),
at 1. The HHS Exclusion stated that the exclusion would become
effective twenty days from the date of the letter. Id. at 1.
Accordingly, I find clear, unequivocal, and convincing record
evidence that HHS excluded Applicant from Medicare, Medicaid, and all
federal health care programs under 42 U.S.C. 1320a-7(a) for a minimum
of 10 years, effective November 20, 2018.
3. Material Falsification of Applicant's Application (21 U.S.C.
824(a)(1))
I find clear, unequivocal, and convincing record evidence that
Applicant answered ``N'' to the first Liability question on the
registration renewal application that was received by DEA on or about
February 1, 2021. RFAAX 1, App. 1, at 2. I find clear, unequivocal, and
convincing record evidence that the text of the first Liability
question on the registration renewal application that Applicant
submitted on or about February 1, 2021, asked whether Applicant had
``ever been . . . excluded or directed to be excluded from
participation in a medicare or state health care program, or is any
such action pending.'' \2\ Id. Accordingly, I find clear, unequivocal,
and convincing record evidence that Applicant's ``N'' response to the
first Liability question on his application that he submitted on or
about February 1, 2021, was false, because the record evidence clearly
establishes that on October 31, 2018, Applicant was excluded from
Medicare, Medicaid and all federal healthcare programs by HHS. See
RFAAX 1, App. E.
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\2\ Although Applicant submitted evidence in his application
related to his conviction and the circumstances of his surrender for
cause of his previous DEA registrations, he did not include any
discernable information on the HHS/OIG exclusion. RFAAX 1, App. 1
(Application).
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B. Discussion
In its OSC, the Government relied upon grounds Congress provided to
support revocation/suspension, not denial of an application. Prior
Agency decisions have addressed whether it is appropriate to consider a
provision of 21 U.S.C. 824(a) when determining whether or not to grant
a practitioner registration application. For over forty-five years,
Agency decisions have concluded that it is. Robert Wayne Locklear,
M.D., 86 FR 33,738 33,744-45 (2021) (collecting cases); see also,
William Ralph Kincaid, M.D., 86 FR 40,636, 40,641 (2021). A provision
of section 824 may be the basis for the denial of a practitioner
registration application and allegations related to section 823 remain
relevant to the adjudication of a practitioner
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registration application when a provision of section 824 is involved.
See Robert Wayne Locklear, M.D., 86 FR at 33,744-45.
Accordingly, when considering an application for a registration, I
will consider any actionable allegations related to the grounds for
denial of an application under 823 and will also consider any
allegations that the applicant meets one or more of the five grounds
for revocation or suspension of a registration under section 824. Id.
See also Dinorah Drug Store, Inc., 61 FR 15,972, 15,973-74 (1996).
1. 21 U.S.C. 823(f): The Five Public Interest Factors
Pursuant to section 303(f) of the Controlled Substances Act
(hereinafter, the CSA), ``[t]he Attorney General shall register
practitioners . . . to dispense . . . controlled substances . . . if
the applicant is authorized to dispense . . . controlled substances
under the laws of the State in which he practices.'' 21 U.S.C. 823(f).
Section 303(f) further provides that an application for a
practitioner's registration may be denied upon a determination that
``the issuance of such registration . . . would be inconsistent with
the public interest.'' Id.
In this case, there is no indication that Applicant does not hold a
valid state medical license or is not authorized to dispense controlled
substances in the State of Utah, where he has applied for a
registration.
Because the Government has not alleged that Applicant's
registration is inconsistent with the public interest under section
823, and although I have considered 823, I will not analyze Applicant's
application under the public interest factors. Therefore, in accordance
with prior agency decisions, I will move to assess whether the
Government has proven by substantial evidence that a ground for
revocation exists under 21 U.S.C. 824(a). Supra B.
2. 21 U.S.C. 824(a)(5): Mandatory Exclusion From Federal Health Care
Programs Pursuant to 42 U.S.C. 1320a-7(a)
Under Section 824(a) of the CSA, a registration ``may be suspended
or revoked'' upon a finding of one or more of five grounds. 21 U.S.C.
824. The ground in 21 U.S.C. 824(a)(5) requires that the registrant
``has been excluded (or directed to be excluded) from participation in
a program pursuant to section 1320a-7(a) of Title 42.'' Id. Here, the
undisputed record evidence demonstrates that HHS mandatorily excluded
Applicant from federal health care programs. RFAAX 6. Accordingly, I
will sustain the Government's allegation that Applicant has been
excluded from participation in a program pursuant to section 1320a-7(a)
of Title 42 and find that the Government has established that a ground
for revocation exists pursuant to 21 U.S.C. 824(a)(5).\3\ Although the
language of 21 U.S.C. 824(a)(5) discusses suspension and revocation of
a registration, for the reasons discussed above, it may also serve as
the basis for the denial of a DEA registration application. See Dinorah
Drug Store, Inc., 61 FR at 15,973 (interpreting 21 U.S.C. 824(a)(5) to
serve as a basis for the denial of an application for registration
because it ``makes little sense . . . to grant the application for
registration, only to possibly turn around and propose to revoke or
suspend that registration based on the registrant's exclusion from a
Medicare program''). Applicant's exclusion from participation in a
program under 42 U.S.C. 1320a-7(a), therefore, serves as an independent
basis for denying his application for DEA registration.
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\3\ It is noted that this Agency has concluded repeatedly that
the underlying crime requiring exclusion from federal health care
programs under Section 1320a-7(a) of Title 42 does not require a
nexus to controlled substances in order to be used as a ground for
revocation or suspension of a registration or denial of an
application. Narciso Reyes, M.D., 83 FR 61,678, 61,681 (2018); KK
Pharmacy, 64 FR at 49,510 (collecting cases); Melvin N. Seglin,
M.D., 63 Red. Reg. 70,431, 70,433 (1998); Stanley Dubin, D.D.S., 61
FR 60,727, 60,728 (1996). In this case, the HHS ALJ applied
aggravating factors to extend Applicant's exclusion period due to
circumstances such as, the amount of restitution ($288,900) and the
length of the criminal activity, which continued over a period of
approximately seven years. RFAAX 1, App. E, at 3. Applicant's
extensive unlawful activity over the course of seven years and his
falsification on his application demonstrate a serious lack of
honesty such that I cannot entrust him with a controlled substances
registration.
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3. 21 U.S.C. 824(a)(1): Material Falsification
As already discussed, I find clear, unequivocal, and convincing
evidence that Applicant submitted a registration application containing
a false answer to the first Liability question. Supra section A.3.
Applicant's false submission implicated Applicant's ``exclu[sion] . . .
from participation in a program pursuant to section 1320a-7(a) of Title
42.'' 21 U.S.C. 824(a)(5). As a result, Applicant's false response to
the first Liability question directly implicated my analysis related to
the CSA's statutory grounds for revocation of a controlled substances
registration, which as explained in supra B.1 and B.2, the agency has
consistently interpreted to be equally relevant to its assessment of an
application for a controlled substances registration. See Robert Wayne
Locklear, M.D., 86 FR at 33,744-45 (collecting cases). Therefore,
Applicant's false submission affected my decision by depriving me of
legally relevant facts when I evaluated Applicant's registration
application. RFAAX 2, at 1; see also Frank Joseph Stirlacci, M.D., 85
FR 45,229, 45,235 (2020). Accordingly, I find, based on the CSA, agency
decisions, and the analysis underlying multiple Supreme Court decisions
explaining ``materiality,'' that the falsity Applicant submitted was
material. Frank Joseph Stirlacci, M.D., 85 FR at 45,235.
I find that there is clear, convincing, and unequivocal evidence in
the record supporting denial of Applicant's application based on his
having ``materially falsified any application filed pursuant to or
required by this subchapter or subchapter II.'' 21 U.S.C. 824(a)(1).\4\
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\4\ See supra B.1 finding that a ground for revocation can serve
as a basis for denial of an application.
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4. Summary of Government's Prima Facie Case
Where, in section 824(a)(5) cases, the applicant offers no
mitigating evidence upon which the Administrator can analyze the facts,
the agency has consistently held that revocation/suspension/denial is
warranted. See, e.g., Sassan Bassiri, D.D.S., 82 FR 32,200, 32,201
(2017); Richard Hauser, M.D., 83 FR 26,308, 26,310 (2018) (revocation
was sought under Section 824(a)(5) and the registrant's certificate of
registration was revoked ``based on the unchallenged basis for his
mandatory exclusion''). Additionally, in this case, there is evidence
on the record that Applicant materially falsified his application. When
the basis for revocation/suspension/denial is clear and the registrant/
applicant has had notice and the opportunity to present evidence,
whether in a hearing or a written statement in accordance with 21 CFR
1301.43, but has chosen not to present any such evidence that could
inform the Administrator's decision, it is reasonable that the
Administrator should revoke or suspend, or deny. See KK Pharmacy, 64 FR
49,507, 49,510 (1999); Orlando Ortega-Ortiz, M.D. 70 FR 15,122 (2005);
Lazaro Guerra, 68 FR 15,266 (2003) (basis for revocation was both
(a)(3) and (a)(5)).
Accordingly, I find that there is clear, convincing, and
unequivocal evidence in the record supporting denial of Applicant's
application based on his exclusion from federal health care programs.
21 U.S.C. 824(a)(5). I further
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find that there is clear, convincing, and unequivocal evidence in the
record supporting denial of Applicant's application based on his
material falsification of his application. 21 U.S.C. 824(a)(1).
C. Sanction
Here, there is no dispute in the record that Applicant is
mandatorily excluded pursuant to Section 1320a-7(a) of Title 42, and,
further that Applicant materially falsified his application for a
controlled substance registration, and therefore, that grounds for the
denial of Applicant's application exist. Where, as here, the Government
has met its prima facie burden of showing that grounds for denial
exist, the burden shifts to the Applicant to show why he can be
entrusted with a registration. Garrett Howard Smith, M.D., 83 FR
18,882, 18,910 (2018) (collecting cases).
In this case, Applicant failed to respond to the Government's Order
to Show Cause and did not avail himself of the opportunity to refute
the Government's case. See RFAA, at 2. Therefore, Applicant has not
provided any remorse or assurances that he would implement remedial
measures to ensure such conduct is not repeated. Such silence weighs
against the Applicant's registration. Zvi H. Perper, M.D., 77 FR at
64,142, citing Medicine Shoppe, 73 FR at 387; see also Samuel S.
Jackson, 72 FR at 23,853. Further, due to the lack of a statement or
testimony from Applicant, it is unclear whether Applicant can be
entrusted with a DEA registration; and therefore, I find that sanction
is appropriate to protect the public from a recurrence of Applicant's
unlawful actions in the context of his CSA registration. See Leo R.
Miller, M.D., 53 FR 21,931, 21,932 (1988).
Consequently, I find that the factors weigh in favor of sanction
and I shall order the sanctions the Government requested, as contained
in the Order below.
Order
Pursuant to 28 CFR 0.100(b) and the authority vested in me by 21
U.S.C. 823(f) and 21 U.S.C. 824(a), I hereby deny the pending
application for a Certificate of Registration, Control Number
H21079595C, submitted by Daniel R. Nevarre, M.D., as well as any other
pending application of Daniel R. Nevarre, M.D. for additional
registration in Utah. This Order is effective [insert Date Thirty Days
From the Date of Publication in the Federal Register].
Anne Milgram,
Administrator.
[FR Doc. 2022-01112 Filed 1-20-22; 8:45 am]
BILLING CODE 4410-09-P
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