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Combat Diversion, but Could Better Assess and Report Program Results' 
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United States Government Accountability Office: 
GAO: 

Report to Congressional Requesters: 

August 2011: 

Prescription Drug Control: 

DEA Has Enhanced Efforts to Combat Diversion, but Could Better Assess 
and Report Program Results: 

GAO-11-744: 

GAO Highlights: 

Highlights of GAO-11-744, a report to congressional requesters. 

Why GAO Did This Study: 

The Drug Enforcement Administration’s (DEA) Diversion Control Program 
is responsible for enforcing the Controlled Substances Act (CSA) and 
ensuring the availability of prescription drugs such as pain relievers 
and stimulants while preventing their diversion for abuse. The CSA 
requires entities handling controlled substances—-such as 
manufacturers, pharmacies, and physicians, among others--to register 
with DEA, which conducts regulatory investigations of registrants, as 
well as criminal investigations. GAO was asked (1) how DEA manages 
diversion investigation efforts, and (2) how DEA ensures policies and 
procedures are followed for investigations and the extent to which it 
determines the results of its efforts. GAO reviewed DEA policies and 
procedures, and interviewed DEA, state, and local officials at eleven 
locations which were selected on the basis of volume of cases handled, 
geographic diversity, and other considerations. These observations are 
not generalizable, but provided insights on DEA operations. 

What GAO Found: 

To respond to the increasing rate of criminal diversion of 
prescription drugs and a growing registrant population, DEA has 
expanded its resources and targeted its investigation strategies to 
collaborate with state and local entities and enhance the 
effectiveness of its diversion investigations. Specifically, the 
agency expanded its use of Tactical Diversion Squads (squads) of DEA 
personnel as well as other federal, state, and local partners 
investigating diversion schemes to maximize resources and improve 
efforts to investigate criminal diversion. DEA currently has 40 squads 
across the country and plans to establish more. According to squad 
participants and DEA officials GAO contacted, the squads have improved 
communication and coordination and simplified information sharing for 
investigations. Because of the growing registrant population and 
noncompliance by some with the CSA and implementing regulations, DEA 
renewed its focus on regulatory oversight of registrants to better 
ensure compliance. By using the squads to free up resources previously 
dedicated to both criminal and regulatory cases, DEA used those 
resources to increase regulatory investigations of the registrants. As 
a result, the number of regulatory investigations more than tripled 
between fiscal years 2009 and 2010. DEA also conducted outreach to 
specific registrant types to inform them of regulatory 
responsibilities and prepare them for regulatory investigations. 

DEA has taken steps to ensure that investigators follow policies and 
procedures for such investigations, but could better assess how its 
efforts are reducing the diversion of prescription drugs. To ensure 
that diversion investigators and special agents have the necessary 
skills to carry out their responsibilities and that DEA monitors the 
extent to which policies and procedures are followed during 
investigations, DEA has established internal controls related to 
guidance, training, and oversight of investigations. These controls 
include providing and updating guidance to investigators to follow 
during investigations, providing initial and on-going training to 
investigators, and monitoring the quality of investigations through a 
combination of direct supervisory reviews, self-inspections, and on-
site internal inspections by DEA’s Office of Inspections. Recent 
reports from on-site internal inspections of each of DEA’s field 
divisions did not identify any widespread or systematic issues related 
to the timeliness and overall quality of diversion investigations. 
Given DEA’s increased focus on investigations in response to growing 
prescription drug diversion, it is critical for DEA to determine the 
extent to which these additional efforts are reducing diversion. DEA 
has established performance measures for the Diversion Control 
Program, but these measures do not clearly demonstrate the effect the 
additional efforts are having on the diversion problem the program 
seeks to address. For example, for its overall performance measure of 
the diversion control program, DEA is tracking the development and 
implementation of an internal information technology project. By more 
closely linking performance measures to the goal of reducing 
diversion, DEA could better capture the results of the Diversion 
Control program to help inform decision makers in allocating resources. 

What GAO Recommends: 

GAO recommends DEA reassess the program’s performance measures to 
better link them to the goal of reducing diversion. DEA did not 
concur. GAO continues to believe the measures could be enhanced as 
discussed in this report. 

View [hyperlink, http://www.gao.gov/products/GAO-11-744]. For more 
information, contact Eileen Larence at (202) 512-8777 or 
larencee@gao.gov. 

[End of section] 

Contents: 

Letter: 

Background: 

DEA Has Expanded Its Resources and Targeted Its Investigation 
Strategies to Respond to Rising Criminal Diversion and Growing 
Registrant Population: 

DEA's Internal Controls Help to Ensure the Quality of Investigations, 
but DEA Could Enhance Efforts to Measure Program Results: 

Conclusions: 

Recommendation for Executive Action: 

Agency Comments and Our Evaluation: 

Appendix I: Comments from the Drug Enforcement Administration: 

Appendix II: GAO Contact and Staff Acknowledgments: 

Tables: 

Table 1: DEA Registrants, by Type, as of May 2011: 

Table 2: Performance Measures for DEA's Diversion Control Program: 

Figures: 

Figure 1: Location of the 40 Tactical Diversion Squads: 

Figure 2: Number of Regulatory Investigations Initiated by DEA 
Diversion Control, by Fiscal Year: 

Figure 3: Description of On-Site Internal Inspection Process: 

Abbreviations: 

ARCOS: Automated Reports and Consolidated Orders System: 

CSA: Controlled Substances Act: 

CPOT: Consolidated Priority Organization Target: 

DEA: Drug Enforcement Administration: 

DOJ: Department of Justice: 

DWP: Drug Addiction Treatment Act waived physician: 

FBI: Federal Bureau of Investigation: 

HHS: Department of Health and Human Services: 

IRS: Internal Revenue Service: 

OMB: Office of Management and Budget: 

ONDCP: Office of National Drug Control Policy: 

PTO: Priority Target Organization: 

RapTOR: Rapid Targeting Online Reports Tool: 

SIP: Self-Inspection Program: 

[End of section] 

United States Government Accountability Office: 
Washington, DC 20548: 

August 26, 2011: 

The Honorable Chaka Fattah: 
Ranking Member: 
Subcommittee on Commerce, Justice, Science and Related Agencies 
Committee on Appropriations: 
House of Representatives: 

The Honorable C.A. Dutch Ruppersberger: 
House of Representatives: 

According to the Office of National Drug Control Policy (ONDCP), the 
abuse of controlled prescription drugs such as pain relievers, 
depressants, and stimulants is the nation's fastest-growing drug 
problem. Although such prescription drugs have legitimate medical 
uses, they also pose a potential for abuse and addiction and, thus, 
being diverted for nonmedical illicit uses. To prevent diversion, the 
Controlled Substances Act (CSA) was enacted in 1970 to regulate and 
facilitate the use of controlled substances, including certain drugs, 
for legitimate medical, scientific, research, and industrial purposes 
while preventing them from being diverted for illegal uses.[Footnote 
1] However, according to recent government data, the diversion of such 
drugs has risen in recent years as have the corresponding prevalence 
of addiction and the cost of lives lost. ONDCP has reported that 
prescription drugs now rank second for the most commonly abused 
category of drugs, behind only marijuana. In 2010, the Substance Abuse 
and Mental Health Services Administration reported that the proportion 
of all substance abuse treatment admissions aged 12 or older that 
reported any pain reliever abuse increased more than fourfold from 
1998 to 2008.[Footnote 2] In terms of the economic costs, a study by 
the University of Washington estimated the cost of the abuse of 
prescription pain relievers in 2006 to be $53.4 billion.[Footnote 3] 

Controlled substances can be diverted in many different ways, and new 
methods continue to evolve over time. Diversion can occur as a result 
of illegal or improper prescribing, prescription forgery, pharmacy 
thefts, or "doctor shopping" where an individual--who may or may not 
have legitimate medical needs--goes to several doctors to obtain a 
prescription from each doctor. Diversion can also occur through 
illegal sales of controlled substances, such as drugs sold by 
physicians, patients, or pharmacists, as well as individuals obtaining 
these substances without a valid prescription through Internet 
pharmacies or pain clinics.[Footnote 4] According to DEA, from fiscal 
years 2006 through 2009, rogue Internet pharmacies were a major source 
of this problem, where individuals could obtain controlled substances 
through Internet pharmacies without establishing a legitimate 
doctor/patient relationship. Following increased enforcement actions 
against rogue Internet pharmacies, another source emerged in the form 
of rogue pain clinics where prescriptions for controlled substances 
could similarly be obtained without a legitimate medical need. These 
pain clinics have proliferated in states such as Florida and Texas. 

Controlled substance diversion poses a unique challenge because of the 
need to balance prevention, education, and enforcement with the need 
for legitimate access. Within the Drug Enforcement Administration 
(DEA), the Office of Diversion Control is directly responsible for 
enforcing the provisions of the CSA as they pertain to ensuring the 
availability of substances such as prescription drugs and listed 
chemicals for legitimate uses while preventing their diversion. As 
part of the provisions to control access to such substances, the CSA 
requires businesses, entities, or individuals that import, export, 
manufacture, distribute, dispense, conduct research with respect to, 
or administer controlled substances to register with the DEA. One of 
the key activities of the Office of Diversion Control is to conduct 
investigations--regulatory investigations to monitor compliance of the 
registrants with the CSA and its implementing regulations, and 
criminal investigations into instances of potential criminal diversion. 

Because of the rising diversion and illicit use of controlled 
prescription drugs, you asked us to review DEA's management of its 
diversion control investigations to combat this problem.[Footnote 5] 
Specifically, this report answers the following questions: 

1. How does DEA manage its investigation efforts to address the 
growing and evolving nature of prescription drug diversion? 

2. How does DEA help ensure that policies and procedures are followed 
for diversion investigations and to what extent does it determine the 
results of its efforts on the diversion problem? 

3. To address the first objective, we reviewed DEA policies and 
procedures on how DEA carries out its investigative responsibilities, 
including program documents such as DEA's current strategic plan and 
budget justification submissions for fiscal years 2008 to 2012. 
[Footnote 6] We also analyzed DEA data for fiscal years 2007 to 2010 
on case volumes for investigations and data on number of personnel 
working on DEA's Tactical Diversion Squads (squads).[Footnote 7] We 
reviewed information from agency officials regarding the data and the 
systems and procedures used to maintain it. From this review we 
determined that the data were sufficiently reliable for the purposes 
of this report. We also interviewed DEA program officials involved in 
overseeing and managing diversion control investigations and program 
officials involved in diversion investigations at 5 of DEA's 21 field 
divisions. These included Seattle, Washington; Houston, Texas; Miami, 
Florida; Washington, D.C.; and Atlanta, Georgia. As part of these 
interviews, we obtained DEA program officials' perspectives on how 
they carry out diversion investigations and how they work with other 
federal, state, and local agencies, as well as registrants in carrying 
out investigatory activities. These field divisions were selected on 
the basis of a mix of criteria such as the range of the highest 
volumes of regulatory and criminal cases and civil penalties; 
geographic diversity; and other considerations. Within each field 
division, we also contacted and interviewed officials of state boards 
of pharmacy and medicine to obtain information on how DEA coordinates 
with their agencies. In order to better understand how DEA is using 
its squads to respond to criminal diversion, we interviewed DEA 
officials and officials from state and local agencies participating in 
the squads to obtain information on how criminal diversion 
investigations are carried out and how DEA coordinates those 
investigations. The 10 squads selected for these interviews were 
Baltimore, Maryland; Worcester, Massachusetts; Houston, Texas; Kansas 
City, Missouri; Miami, Florida; New Orleans, Louisiana; Oakland, 
California; Seattle, Washington; Tampa, Florida; and Washington, D.C., 
and were chosen based on a mix of criteria such as the range of the 
highest volume of cases handled, length of time in operation, and the 
participation of state and local agencies. Our results are not 
generalizable across all field divisions or squads but provide a broad 
overview and understanding of diversion investigations, as well as how 
DEA has managed these investigations and coordinates with other non-
DEA partners. We also interviewed officials with associations 
representing pharmacies and distributors, as well as pharmacies and 
distributors identified by these associations, to obtain regulated 
industry's perspective on how DEA carries out its regulatory 
responsibilities and interacts with this industry. The information we 
obtained from interviewing officials with these associations as well 
as officials with pharmacies and distributors that were identified by 
the associations, cannot be generalized across the entire population 
of pharmacy and distributor operators. However, the information 
gathered in these interviews provided us with perspectives from 
regulated industry on how DEA has implemented its diversion control 
efforts and how it interacts with industry in monitoring compliance 
with the CSA. 

To address the second objective, we compared criteria in Standards for 
Internal Control in the Federal Government to (1) DEA's control 
activities related to human capital management and (2) DEA's 
monitoring mechanisms to identify what actions it has taken to ensure 
its employees are informed and follow required policies and 
procedures.[Footnote 8] We also reviewed DEA policies and procedures 
in its manuals for Diversion Investigators and Special Agents, as well 
as documents related to DEA training courses conducted for program 
personnel to determine DEA's efforts to ensure its employees have the 
required knowledge to conduct diversion investigations. We reviewed 
the most recent on-site internal inspection reports for each of DEA's 
21 field divisions, ranging from fiscal years 2005 to 2010 to 
determine what issues, if any, were identified with respect to 
diversion investigations.[Footnote 9] At headquarters, we interviewed 
DEA program officials in the Office of Training, Office of 
Inspections, and the Regulatory Section. Our purpose was to determine 
what actions they take to train employees on required policies and 
procedures and conduct reviews of employee work products. We also 
reviewed DEA's Strategic Plan Fiscal Years 2009-2014 to identify DEA's 
plans for ongoing monitoring efforts. To determine how DEA measures 
the results of its efforts against the diversion problem, we reviewed 
DEA's Strategic Plan Fiscal Years 2009-2014, as well as the 
corresponding performance measures DEA has designated for the 
diversion control program as reported in its budget justifications for 
fiscal years 2008 through 2012. We compared DEA's identified 
performance measures with best practices for performance measurement 
identified in our previous guidance and work regarding the 
implementation of the Government Performance and Results Act to 
determine the extent to which the measures could be used to 
demonstrate program results.[Footnote 10] We also interviewed DEA 
officials within the Office of Diversion Control and the Office of 
Resource Management to determine how they use these measures, and what 
plans, among other things, they had to evaluate the usefulness of the 
measures as indicators to track results towards the program's overall 
performance goal of reducing the diversion of licit drugs. 

We conducted this performance audit from May 2010 through August 2011 
in accordance with generally accepted government auditing standards. 
Those standards require that we plan and perform the audit to obtain 
sufficient, appropriate evidence to provide a reasonable basis for our 
findings and conclusions based on our audit objectives. We believe 
that the evidence obtained provides a reasonable basis for our 
findings and conclusions based on our audit objectives. 

Background: 

The CSA and DEA's Office of Diversion Control: 

The CSA places various plants, drugs, and chemicals such as narcotics, 
stimulants, depressants, hallucinogens, and anabolic steroids, into 
one of five schedules based on the substance's medical use or lack 
thereof, potential for abuse, and safety or potential for dependence. 
[Footnote 11] The act requires persons who handle controlled 
substances and/or listed chemicals (such as manufacturers, wholesale 
distributors, physicians who dispense controlled substances, 
hospitals, pharmacies, importers/exporters, and scientific 
researchers) to register with the DEA. This agency, by delegation from 
the U.S. Attorney General, is responsible for administering and 
enforcing the CSA and its implementing regulations. Through its Office 
of Diversion Control, DEA administers the Diversion Control Program 
whose mission is to prevent, detect, and investigate the diversion of 
controlled pharmaceuticals and listed chemicals into the illicit 
market, while ensuring an adequate and uninterrupted supply for 
legitimate needs. In addition to conducting investigations, the office 
conducts a variety of activities such as the establishment of 
production quotas, drafting and promulgating regulations for handling 
controlled substances, regulating handlers of controlled substances, 
and monitoring and tracking the production and distribution of certain 
controlled substances, among other things. To carry out this mission, 
the Office of Diversion Control is authorized approximately 1,300 full-
time equivalent positions and a budget of approximately $292 million. 
The program is funded through the Diversion Control Fee Account, which 
consists of registration fees paid by registrants. 

[Side bar: 
Schedules of controlled substances: 

Controlled substances are classified into five schedules on the basis 
of their currently accepted medical use and potential for abuse and 
dependence: 

* Schedule I substances have no currently accepted medical uses and 
have a high potential for abuse. Examples: heroin and marijuana. 

* Schedule II substances have currently accepted medical uses but also 
have high potential for abuse that may lead to severe psychological or 
physical dependence. Examples: oxycodone and (methylphenidate) Ritalin. 

* Schedule III substances have currently accepted medical uses and a 
potential for abuse which may lead to moderate or low physical 
dependence or high psychological dependence. Examples: anabolic 
steroids, codeine, and hydrocodone in combination with aspirin or 
acetaminophen. 

* Schedule IV substances have currently accepted medical uses and a 
low potential for abuse which may lead to limited physical or 
psychological dependence. Examples: anti-anxiety medications diazepam 
(Valium) and alprazolam (Xanax). 

* Schedule V substances have currently accepted medical uses and a low 
potential for abuse which may lead to limited physical or 
psychological dependence. Example: cough syrup preparations with 
codeine. 

All drugs but those in Schedule I are legally available with a 
prescription. 

Sources: 21 U.S.C. § 812; GAO. End of side bar] 

DEA Registers Entities Authorized to Handle Controlled Substances: 

As required by the CSA, businesses, individuals, or entities that 
import, export, manufacture, distribute, dispense, conduct research 
with respect to controlled substances and/or listed chemicals must 
register with the DEA. DEA has more than 1.3 million individuals and 
companies that are registered to handle controlled substances or 
regulated chemicals. These registrants include manufacturers, 
distributors, and importers/exporters of controlled substances or 
medications; pharmacies, hospitals, narcotic treatment programs, and 
clinics that dispense controlled medications; practitioners who 
prescribe and administer or dispense controlled medications; and 
researchers who use controlled substances or medications in their 
research or analyses (see table 1.) 

Table 1: DEA Registrants, by Type, as of May 2011: 

Registrant type: Practitioner; 
Number of registrant type: 1,103,159; 
Percent of total registrant population: 79.46%. 

Registrant type: Mid-Level Practitioner; 
Number of registrant type: 188,577; 
Percent of total registrant population: 13.58%. 

Registrant type: Retail Pharmacy; 
Number of registrant type: 66,829; 
Percent of total registrant population: 4.81%. 

Registrant type: Hospital/Clinic; 
Number of registrant type: 15,735; 
Percent of total registrant population: 1.13%. 

Registrant type: Researcher; 
Number of registrant type: 9,036; 
Percent of total registrant population: 0.65%. 

Registrant type: Analytical Labs; 
Number of registrant type: 1,483; 
Percent of total registrant population: 0.11%. 

Registrant type: Narcotic Treatment Program; 
Number of registrant type: 1,259; 
Percent of total registrant population: 0.09%. 

Registrant type: Distributor; 
Number of registrant type: 793; 
Percent of total registrant population: 0.06%. 

Registrant type: Manufacturer; 
Number of registrant type: 526; 
Percent of total registrant population: 0.04%. 

Registrant type: Teaching Institute; 
Number of registrant type: 348; 
Percent of total registrant population: 0.03%. 

Registrant type: Exporter; 
Number of registrant type: 228; 
Percent of total registrant population: 0.02%. 

Registrant type: Importer; 
Number of registrant type: 206; 
Percent of total registrant population: 0.01%. 

Registrant type: Reverse Distributor[A]; 
Number of registrant type: 59; 
Percent of total registrant population: less than 0.01%. 

Registrant type: Total; 
Number of registrant type: 1,388,238; 
Percent of total registrant population: 100.00%. 

Source: DEA. 

Notes: 

[A] A reverse distributor is a registrant who receives controlled 
substances acquired from another DEA registrant for the purpose of 
returning unwanted, unusable, or outdated controlled substances to the 
manufacturer or the manufacturer's agent, or processes such substances 
or arranges for processing such substances for disposal. 

[End of table] 

In order to maintain their registration, DEA registrants must comply 
with a variety of regulatory requirements imposed by the CSA and its 
implementing regulations. Examples of these regulatory requirements 
include: 

* Recordkeeping: A registrant must keep accurate records and maintain 
detailed inventories of controlled substances in compliance with 
applicable federal and state laws. For example, the registrant must 
maintain accurate records of each substance manufactured, received, 
sold, delivered, or otherwise disposed of by the registrant. 

* Reporting: Manufacturers and distributors must report acquisition or 
distribution transactions of certain controlled substances, such as 
Schedule I and II drugs and Schedule III narcotics, to DEA through the 
Automated Reports and Consolidated Orders System (ARCOS). ARCOS is an 
automated reporting system to monitor the flow of controlled 
substances from their point of manufacture to the point of sale or 
distribution at the dispensing/retail level such as hospitals, retail 
pharmacies, practitioners, midlevel practitioners, and teaching 
institutions. Manufacturing transactions of Schedule I and II 
controlled substances, as well as Schedule III and IV narcotics, among 
others are also covered by the ARCOS reporting requirements. 

* Dispensing of controlled substances: The CSA provides special 
requirements for licensed practitioners and pharmacists who dispense 
controlled substances in Schedules II-V to patients. For example, a 
prescription for a controlled substance must be "issued for a 
legitimate medical purpose by an individual practitioner acting in the 
usual course of his professional practice." Accordingly, practitioners 
also have a responsibility to ensure that the controlled substance is 
properly prescribed and dispensed while a corresponding responsibility 
exists with the pharmacist filling the prescription. 

* Security of controlled substances: For the purposes of ensuring the 
secure storage and distribution of controlled substances, all 
registrants must "provide effective controls and procedures to guard 
against theft and diversion of controlled substances." Among other 
things, DEA regulations also detail specific security requirements for 
the different types of applicants and registrants. For example, 
nonpractitioners (i.e., manufacturers, distributors, and narcotic 
treatment programs) are required to store Schedule I and II substances 
in electronically monitored safes, steel cabinets, or vaults that meet 
or exceed certain specifications. Licensed practitioners must store 
controlled substances in a "securely locked, substantially constructed 
cabinet" and must notify DEA of the theft or significant loss of any 
controlled substances. 

DEA investigations to monitor and enforce CSA compliance: 

To achieve its mission, DEA monitors and enforces compliance with the 
CSA through three types of investigations--regulatory, complaint, and 
criminal: 

* Regulatory Investigations: DEA conducts scheduled investigations or 
inspections (depending on the registrants, the frequency of the 
scheduled investigations can range from every 3 years to every 5 
years) of wholesale registrants who include manufacturers, 
distributors, importer/exporters, and narcotic treatment programs as 
well as other registrants such as researchers, analytical labs, and 
teaching institutions, among others. Retail level registrants such as 
pharmacies and physicians--with the exception of physicians permitted 
to treat narcotic dependence--do not receive regulatory investigations 
by the DEA. These registrants are regularly investigated by the states 
in which they conduct business. According to DEA officials, they focus 
their efforts related to regulatory investigations on the wholesale 
registrants because such registrants are the sources of supply to 
criminal schemes such as rogue pharmacies and pill mills. To conduct 
these investigations, DEA Diversion Investigators arrive at the 
registrant unannounced and inspect and verify the registrant's 
records, take a physical inventory of the registrant's controlled 
substances, and inspect any other items necessary to verify the 
registrant's compliance with the CSA and its implementing regulations. 
If deficiencies are found during the investigation, DEA may work with 
the registrant to correct the deficiencies. DEA may also take 
administrative, civil, or criminal action against the registrant 
depending on the type, severity, and frequency of the deficiencies 
found. 

* Complaint Investigations: Complaint investigations are 
investigations that are started on the basis of information or a tip 
provided to DEA or state regulators, or other information DEA has 
regarding purchases or losses of controlled substances. The origin of 
the information could be from any number of sources, such as a state 
or local official or citizen that saw something suspicious, employees 
of a registrant, the identification of unusual purchasing trends by a 
registrant such as a pharmacy tracked by DEA through its ARCOS, or a 
report of a loss of controlled substances by a registrant. Diversion 
Investigators conduct preliminary investigative work to determine 
whether the information is valid and warrants a full investigation. 
Depending on the outcome of the preliminary complaint investigation, 
DEA determines whether the investigation will be handled as a 
regulatory noncompliance issue, a criminal case, or a dismissal. 

* Criminal Investigations: DEA also conducts investigations into 
criminal activities involving diversion of controlled substances. 
Criminal diversion may involve DEA registrants such as pharmacies and 
practitioners and nonregistrants such as pharmacy burglars or doctor 
shoppers, among others. 

[Side bar: Penalties for diversion of controlled substances: 

DEA can initiate a variety of actions for violations of the CSA or its 
implementing regulations. The type(s) of action taken is typically 
driven by the severity of the offense(s) and whether or not a 
registrant was the subject of any previous actions. The following is a 
partial listing of potential actions DEA can take against a registrant 
or diverter: 

* Administrative actions are handled primarily by DEA and can include 
(1) a letter of admonition to advise the registrant of any violations; 
(2) an order to show cause which initiates revocation or suspension of 
a DEA registration; and (3) an immediate suspension order against the 
registrant if there is a finding of imminent threat to public health 
or safety. 

* Civil penalties are typically coordinated with an Assistant United 
States Attorney or in some instances the local district attorney. 
Civil violations are typically recordkeeping violations involving 
controlled substances or listed chemicals. Penalties for civil actions 
generally include monetary fines. 

* Criminal prosecutions are coordinated with an Assistant United 
States Attorney or local district attorney. Criminal violations 
include offenses such as the illegal distribution of controlled 
substances and other related offenses such as health care fraud, tax 
evasion, and money laundering. Criminal penalties generally include 
incarceration and fines. 

Source: DEA. End of side bar] 

Within its 21 field divisions, DEA utilizes a variety of personnel to 
carry out these investigative responsibilities: 

* Diversion Investigators conduct investigations of regulatory, civil, 
and criminal issues pertaining to DEA registrants. The investigators 
do not have law enforcement authority and cannot perform law 
enforcement functions such as making arrests and conducting 
surveillance. 

* Special Agents conduct diversion investigations and assist Diversion 
Investigators by performing law enforcement functions such as serving 
search warrants and making arrests. 

* Diversion Program Managers oversee diversion control activities in 
their field division. 

* Special Agents-in-Charge manage the activities of the DEA field 
division including diversion control activities. 

* Assistant Special Agents-in-Charge assist the Special Agents-in- 
Charge in managing activities of the field division including 
diversion control activities. 

DEA Has Expanded Its Resources and Targeted Its Investigation 
Strategies to Respond to Rising Criminal Diversion and Growing 
Registrant Population: 

To respond to the increasing rate of criminal diversion and a growing 
registrant population, DEA has expanded its resources and targeted 
investigation strategies in ways to collaborate with state and local 
entities and enhance the effectiveness of its Diversion Control 
Program. Specifically, DEA has expanded its use of Tactical Diversion 
Squads, which work with DEA's state, local, and other federal 
partners, to maximize resources and improve efforts to investigate, 
disrupt, and dismantle individuals or organizations involved in 
diversion schemes related to controlled substances and listed 
chemicals. DEA has also renewed its focus on regulatory oversight of 
the more than 1.3 million DEA registrants to ensure registrants comply 
with the CSA and implementing regulations. DEA accomplished this by 
increasing the frequency of scheduled investigations of DEA 
registrants that are registered to handle controlled prescription 
drugs. 

Tactical Diversion Squad Expansion Provides Additional Resources and 
Facilitates Coordination and Information Sharing for Criminal 
Investigations: 

To help respond to the ever-changing methods of criminal diversion 
such as rogue pain clinics and rogue Internet pharmacy schemes, in 
October 2008 the DEA acting Administrator authorized the expansion of 
squads devoted to addressing criminal diversion of controlled 
substances and listed chemicals across the United States. DEA has 
historically utilized these squads, called Tactical Diversion Squads 
(squads), as a collaborative mechanism to address the criminal 
diversion of controlled substances. The squads are teams of DEA 
diversion personnel (such as Special Agents and Diversion 
Investigators), as well as state and local law enforcement personnel 
(task force officers) whose mission is to detect, investigate, and 
refer for prosecution, violators of federal and state statutes 
pertaining to diversion. They also develop investigative leads from 
information and intelligence obtained from participating agencies, 
undercover operations, and the use of informants. This multiagency 
effort helps coordinate the investigative activities of the 
participating agencies. According to DEA, the squads also allow DEA to 
provide manpower for diversion investigations at reduced costs to DEA 
because task force officer positions are less expensive than Special 
Agents or Diversion Investigators. For example, DEA compensates state 
and local Tactical Diversion Squad task force officers for overtime, 
use of a vehicle, equipment, and diversion training, while the parent 
agencies are responsible for their task force officers' salary and 
benefits. 

This expansion resulted in a significant increase in the number of 
Special Agents and task force officers for criminal diversion 
investigations. At the time the expansion was authorized, DEA had 5 
squads in operation which, according to DEA officials, were authorized 
5 Special Agents, 12 Diversion Investigators, and 27 task force 
officers. With existing positions and funding previously authorized 
and agreements with state and local law enforcement partners in place, 
DEA has since established 35 additional squads across the United 
States (see figure 1) increasing the total number of Special Agents, 
Diversion Investigators, and task force officers working on all the 
squads to a total of 141, 54, and 301, respectively.[Footnote 12] With 
the increase in squads, DEA has been able to perform more criminal 
investigations each year. For example, DEA was able to increase the 
number of criminal investigations initiated from 1,571 in fiscal year 
2009 to 1,904 in fiscal year 2010, an increase of 21 percent. 
According to the Executive Assistant to the Deputy Assistant 
Administrator for Diversion Control, they plan to add 16 more squads 
between fiscal years 2011 and 2013 and eventually have at least 63 
squads across the country, depending on the need for the squads and 
availability of resources. With the further expansion of these squads, 
DEA officials stated that they expect to continue to be able to 
conduct more criminal diversion investigations each year. To staff 
these additional squads, DEA requested an additional 60 Special Agent, 
37 Diversion Investigator, and 64 task force officer positions for 
fiscal year 2011, and an additional 50 Special Agent, 16 Diversion 
Investigator, and 64 task force officer positions for fiscal year 
2012. Because the Diversion Control program is funded through its fee 
account, DEA officials noted that such increases in personnel are 
contingent on the revision of the schedule of fees charged 
registrants, which is currently underway.[Footnote 13] They anticipate 
beginning to collect fees under the revised fee schedule in fiscal 
year 2012. DEA's current annual registrant fees range from $184 to 
$2,293.[Footnote 14] The last time DEA revised its fees was in 2006. 

[Side bar: 
Coordination with state partners: Prescription Drug Monitoring 
Programs: 

State Prescription Drug Monitoring Programs (PDMPs) provide data and 
analysis to state law enforcement and regulatory agencies to assist in 
identifying activities potentially related to the illegal prescribing, 
dispensing, and procuring of controlled substances. The PDMP can be 
designed to identify possible abusers or diverters by tracking the 
volume and frequency of prescriptions. As of June 2011, 35 states have 
operational PDMPs that have the capability to receive and distribute 
controlled substance prescription information to authorized users. As 
the PDMP is a state program, DEA does not have a role in its 
implementation or operation. However, DEA can access PDMP data for use 
in squad investigations. In 2002, we reported that states with PDMPs 
experienced considerable reductions in the time and effort required to 
investigate drug diversion cases (see GAO-02-634). 

Sources: GAO; DEA. End of side bar] 

Figure 1: Location of the 40 Tactical Diversion Squads: 

[Refer to PDF for image: U.S. map] 

The following locations are depicted on the map: 

Albany, New York; 
Albuquerque, New Mexico; 
Atlanta, New York; 
Austin, Texas; 
Baltimore, Maryland; 
Beaumont, Texas; 
Boston, Massachusetts; 
Chicago; Illinois; 
Cleveland, Ohio; 
Dallas, Texas; 
Denver, Colorado; 
Detroit, Michigan; 
El Paso, Texas; 
Houston, Texas; 
Jackson, Mississippi; 
Kansas City, Missouri; 
Las Vegas, Nevada; 
Lexington, Kentucky; 
Los Angeles, California; 
Miami, Florida; 
New Orleans, Louiisiana; 
New York City, New York; 
Newark, New Jersey;
Oakland, California; 
Philadelphia, Pennsylvania; 
Phoenix, Arizona; 
Pittsburgh, Pennsylvania; 
Ponce, Puerto Rico; 
Portland, Oregon; 
Sacramento, California; 
St. Louis, Missouri; 
Salt Lake City, Utah; 
San Diego, California; 
San Juan, Puerto Rico; 
Seattle, Washington; 
Tampa, Florida; 
Tucson, Arizona; 
Washington, D.C. 
Worcester, Massachusetts. 

Source: GAO analysis of DEA data; Copyright © Corel Corp. All rights 
reserved (map). 

[End of figure] 

Coordinating with state and local law enforcement has been beneficial 
to the squads in investigating diversion. According to squad 
participants in 6 of the 10 squads we contacted, state and local law 
enforcement's participation is critical because they are familiar with 
the local communities they patrol and are able to bring information 
from their communities to the investigations.[Footnote 15] At the same 
time, participating in the squad has enabled local law enforcement 
agencies to carry out more complex investigations into diversion 
within their localities. For example, although some local law 
enforcement agencies had conducted investigations of lower level 
diverters such as doctor shoppers prior to the establishment of 
squads, they did not have the resources on their own to carry out the 
longer, more complex investigations required for targeting higher 
level diverters such as physicians and their clinics. DEA officials 
noted that state and local agencies also lack the administrative 
authorities DEA has to take action against a DEA registrant when 
necessary. The squad provided a means for state and local law 
enforcement to collectively pool their resources with DEA to 
investigate higher level diverters. 

[Side bar: 
Example of diversion of controlled substances—-Illegal pain clinics: 

States such as Florida have experienced significant diversion problems 
through illegal pain clinics. According to DEA officials, Florida 
physicians order the majority of oxycodone compared to the rest of the 
country. In 2010, Florida dispensing physicians ordered over 41 
million dosage units of oxycodone, while the rest of the country 
ordered a total of 4 million dosage units. Some of these physicians 
are reported to have links to illegal pain clinics where they either 
dispensed or wrote prescriptions that were not for legitimate medical 
purposes. Individuals from other states would come to Florida to visit 
the clinics to obtain controlled substances for abuse or resale. 
Florida recently enacted legislation to address these clinics. 
Similarly, Texas and Louisiana have experienced problems with illegal 
pain clinics and also enacted legislation to address this problem. 
Among other things, the legislation for these states requires pain 
clinics to be owned and operated by licensed physicians with no 
previous medical board action, and to register with state regulators. 

[Photograph: The picture shows a line up of individuals detained after 
a law enforcement raid of a Florida pain clinic.] 

Sources: DEA, Federation of State Medical Boards, and National Drug 
Intelligence Center (data); Edward Linsmier/St. Petersburg Times 
(image). End of side bar] 

Based on feedback from squad participants and DEA officials we 
interviewed, coordination and information sharing within the squads 
were reported as excellent and an improvement over presquad times. 
According to DEA and local officials we interviewed, the establishment 
of the squads has been a means to improve communication, coordination, 
and simplify information sharing as the squads have become the 
clearinghouse for diversion-related investigative information. As a 
result, information is now shared more rapidly and broadly between law 
enforcement agencies, according to these officials we interviewed. 
These squads have also become an important deconfliction mechanism for 
law enforcement agencies regarding the diversion cases they are 
working or information they receive from other sources. For example, 
one local law enforcement official with a task force officer on a 
squad stated that all leads his department receives for potential 
diversion investigations are first referred to the squad to determine 
whether there are any links to ongoing squad investigations or if the 
lead would be an appropriate target for it to take on as a new 
investigation. 

Federal agencies such as the Federal Bureau of Investigation (FBI), 
the U.S. Department of Health and Human Services (HHS), and the 
Internal Revenue Service (IRS) may also be involved in the squads' 
criminal investigations depending on the case and if their expertise 
is needed. For example, FBI agents will generally join a squad's 
investigation if fraud is involved; HHS investigators may become 
involved in investigations related to health care fraud; and IRS 
agents may assist in investigations involving tax evasion and money 
laundering. In March 2011, for example, the DEA in conjunction with 
the FBI and HHS, among other agencies, concluded an investigation into 
a Detroit physician for unlawfully distributing controlled substances, 
including the Schedule II controlled substance OxyContin (oxycodone), 
and fraudulently billing Medicare. According to DEA, a conviction of 
this offense carries a maximum of 20 years in prison, a fine of $1 
million, or both. In another example, according to DEA squad 
officials, DEA, FBI, and IRS, among others, conducted a joint criminal 
investigation into a Texas business owner's rogue Internet pharmacy 
scheme. The investigation resulted in a guilty plea to several 
offenses including unlawfully distributing controlled substances, 
money laundering, and fraudulently billing healthcare providers, among 
other offenses. According to DEA officials, joint investigations with 
other federal agencies are very helpful for the squad in advancing the 
investigation because the other federal agencies bring specific 
subject matter expertise in areas that DEA staff do not have. 

[Side bar: 
Tactical Diversion Squad investigation: Operation Pill Nation: 

To deal with criminal diversion, DEA through its Tactical Diversion 
Squads worked with federal, state, and local law enforcement partners 
to conduct criminal investigations. As an example of collaborative 
actions to address criminal diversion, the Miami Tactical Diversion 
Squad and its law enforcement partners are conducting an investigative 
effort called Operation Pill Nation. This operation involved the 
mobilization of 11 squads from across the United States to coordinate 
with the Miami Tactical Diversion Squad in investigating illegal pain 
clinics. As of April 2011, DEA reported that the investigation 
resulted in the closure of 38 clinics, the arrest of 32 individuals 
including 12 physicians, the seizure of more than $16.4 million in 
assets, and the surrender of 83 DEA registrations. 

Two photographs: Exotic cars seized during Operation Pill Nation.] 

Source: DEA. End of side bar] 

DEA Has Significantly Increased the Number of Regulatory 
Investigations to Help Ensure Growing Registrant Population Complies 
with CSA: 

In addition to the expansion of the squads in October 2008, the DEA 
acting Administrator also called for an enhanced focus on DEA's 
regulatory oversight aimed at ensuring that the more than 1.3 million 
DEA registrants comply with the CSA and its implementing regulations. 
According to DEA, the overall registrant population tends to grow at a 
rate of 2 to 2.5 percent annually; however, registrants such as Drug 
Addiction Treatment Act[Footnote 16] waived physicians (DWPs) have 
grown faster. For example, from fiscal year 2002 to fiscal year 2010 
the number of DEA registered DWPs increased from 1,451 to 19,211, an 
increase of about 1,300 percent. DWPs are physicians who dispense or 
prescribe Federal Food and Drug Administration approved buprenorphine 
products for treatment of narcotic addiction/dependence on an 
outpatient basis. In an effort to help meet the demand for this 
specialty, the Drug Addiction Treatment Act of 2000 waived the 
requirement for qualified physicians to obtain a separate DEA 
registration as a Narcotic Treatment Program in order to provide 
medication-assisted chemical substance therapy.[Footnote 17] With the 
enactment of the act, the Substance Abuse and Mental Health Services 
Administration within HHS aggressively pursued training for interested 
physicians to help meet this demand. As a result, there was a 
significant increase in the number of physicians who registered with 
DEA as DWPs. In response to this growing registrant population, DEA 
increased the frequency of scheduled investigations of DWPs as part of 
the enhanced regulatory oversight called for by the acting 
Administrator. For example, in October 2008, DEA decided to move 
towards conducting regulatory investigations of all DWPs every 5 years 
to monitor for compliance. Previously DEA was conducting regulatory 
investigations of only one DWP in each of its 21 Field Divisions 
annually, a rate that, given the growth of that registrant type, would 
have taken decades for DEA to investigate all registered DWPs, 
according to the Executive Assistant to the Deputy Assistant 
Administrator for the Diversion Control Program. According to DEA's 
Chief of the Regulatory Section, the decision to increase the rate for 
conducting regulatory investigations of DWPs was also due, in part, to 
some DWPs not complying with regulatory requirements relating to 
recordkeeping and the loss of controlled substances used to treat 
patients. 

DEA also increased the frequency of regulatory investigations for 
other registrant types as well, such as registrants involved in the 
manufacture and distribution of drugs (from once every 5 years to once 
every 3 years), and chemicals (from once every 3 years to once every 2 
years).[Footnote 18] For some registrant types that had not previously 
been subject to regulatory investigation, such as researchers, 
analytical labs, and teaching institutions, DEA required that 
regulatory investigations be conducted once every 5 years. According 
to DEA's Chief of the Regulatory Section, the increase in the 
frequency of regulatory investigations for some registrant types was 
also due to the registrants' noncompliance with the CSA and DEA's 
implementing regulations. For example, some distributors did not 
report suspicious orders for controlled substances to DEA, as required 
by regulation.[Footnote 19] Reflecting the changes in requirements for 
regulatory investigations, DEA more than tripled the number of 
regulatory investigations from 1,173 in fiscal year 2009 to 3,731 in 
fiscal year 2010 (see figure 2 below). 

Figure 2: Number of Regulatory Investigations Initiated by DEA 
Diversion Control, by Fiscal Year: 

[Refer to PDF for image: line graph] 

Fiscal year: 2007; 
Number of investigations: 1,158. 

Fiscal year: 2008; 
Number of investigations: 1,161. 

Fiscal year: 2009; 
Number of investigations: 1,173. 

Fiscal year: 2010; 
Number of investigations: 3,731. 

Source: GAO analysis of DEA data. 

[End of figure] 

According to the Executive Assistant to the Deputy Assistant 
Administrator for Diversion Control, DEA was able to increase its 
regulatory investigations primarily by using the squads to free up 
Diversion Investigator resources that had previously been working both 
criminal and regulatory cases and DEA plans to hire additional 
diversion staff in the future to conduct investigations. To keep up 
with the level of regulatory investigations to be completed in the 
future, DEA plans to hire additional staff. For example, for fiscal 
year 2011 DEA requested 60 Diversion Investigator positions and for 
fiscal year 2012 requested an additional 50 Diversion Investigator 
positions, pending completion of the revision of the schedule of fees 
charged registrants, which must provide the funding necessary to fill 
those positions.[Footnote 20] According to DEA officials, of the 60 
Diversion Investigator positions requested for fiscal year 2011, 23 
were requested to support regulatory activities while 37 were to 
support the squads; for fiscal year 2012, of the 50 Diversion 
Investigator positions requested, 34 were for regulatory activities 
and 16 for support of the squads. 

In addition to conducting regulatory investigations, DEA has also 
actively engaged registrants and their industry associations to help 
the registrants understand current trends in diversion and the 
regulatory obligations they must demonstrate that they have fulfilled 
during regulatory investigations. For example, DEA periodically hosts 
conferences for the chemical and pharmaceutical industries to share 
information on current trends, issues, federal laws, and regulations, 
and to discuss practices to prevent diversion. Industry associations 
reported that DEA also attends industry-sponsored conferences and 
shares useful information and guidance. In addition, regulated 
industry reported that DEA provides information to registrants on 
DEA's Web site as well as through policy letters and correspondence. 
According to DEA officials, they also speak at conferences such as the 
National Association of Boards of Pharmacy, the American Society of 
Interventional Pain Physicians, pharmacy schools, and other industry 
venues. 

Furthermore, DEA has conducted other targeted outreach efforts to 
specific registrant types to inform them of specific regulatory 
responsibilities or help them prepare for regulatory investigations: 

* In 2005 DEA established an initiative to better inform wholesale 
distributors of controlled substances of their responsibilities under 
the CSA to report suspicious orders from pharmacies that are possibly 
filling invalid prescriptions. As part of this initiative, DEA created 
a presentation explaining the laws, regulations, and DEA policies. The 
presentation provided examples of Internet pharmacies and rogue pain 
clinics as well as their purchase patterns and methods of operation. 
The presentation was designed to emphasize the need for wholesalers to 
utilize due diligence, and when appropriate, stop supplying retail 
outlets with controlled substances where diversion is occurring. From 
August 2005 through March 2011, DEA reported briefing 74 corporations 
concerning illegal Internet pharmacy operations and rogue pain 
clinics. Since the launch of the program, DEA reports that 
distributors have voluntarily stopped selling or restricted sales of 
controlled substances to approximately 1,390 customers believed to be 
placing suspicious orders for such substances. 

* During 2009 and 2010, DEA's Office of Diversion Control officials 
met with a number of DWPs and industry associations that represent 
DWPs to inform them about the regulatory investigation process and 
regulatory requirements. They discussed recordkeeping and the security 
of controlled substances, among other items, that DWPs must meet to 
comply with the CSA and its implementing regulations. 

DEA's Internal Controls Help to Ensure the Quality of Investigations, 
but DEA Could Enhance Efforts to Measure Program Results: 

DEA helps to ensure the quality of its diversion control 
investigations through the use of internal controls, but could enhance 
its efforts to measure the results of its Diversion Control Program. 
To ensure that Diversion Investigators and Special Agents have the 
necessary skills to carry out their responsibilities and that DEA 
monitors the results of its employee guidance and training, DEA has 
established internal control activities, which are consistent with 
Standards for Internal Control in the Federal Government. DEA has 
established performance measures to assess and report on its progress 
toward meeting its performance goal of reducing the diversion of licit 
drugs, but could reassess the measures to identify ways to better 
capture and report on the results of DEA's investigations. 

DEA's Efforts to Ensure Its Staff Have the Necessary Guidance, 
Training, and Oversight Are Consistent with Internal Control Standards: 

Diversion investigations are the primary means DEA uses to monitor 
registrant compliance with the CSA and to identify diversion 
activities. As such, it is important that the employees responsible 
for conducting investigations--Diversion Investigators and Special 
Agents--have the necessary skills to carry out their responsibilities 
and that DEA management monitors the results of its investigative 
efforts. To accomplish this, DEA has established internal control 
activities related to guidance, training, and monitoring. Given DEA's 
increased focus on regulatory and criminal investigations in response 
to growing and evolving diversion, these internal controls help to 
provide reasonable assurance that investigators and agents have the 
necessary skill levels to meet existing program requirements for 
diversion investigations and changing organizational priorities as new 
trends in diversion emerge. 

DEA guidance and training provide investigators tools needed for 
investigations: 

DEA has established internal control activities related to guidance 
and training such as program policy and procedures manuals and 
diversion investigation courses. These efforts are consistent with 
Standards for Internal Control in the Federal Government, which state 
that agency management should help to ensure it has a workforce that 
has the required skills that match those necessary to achieve 
organizational goals. Specifically, DEA provides guidance in the form 
of manuals to its Diversion Investigators and Special Agents on the 
policies and procedures they are to follow in conducting diversion 
investigations. DEA officials told us that they use this guidance for 
conducting diversion investigations and reviewing employee work 
products. The Diversion Investigator Manual describes and explains the 
policies and procedures for Diversion Investigators in carrying out 
their regulatory and investigative responsibilities, the processes for 
conducting diversion investigations, and the procedures for developing 
investigative reports. The Special Agent Manual describes and explains 
the responsibilities of Special Agents in diversion investigations. 
[Footnote 21] 

In order to familiarize employees with the process for conducting 
diversion investigations and related policies and procedures, DEA 
requires basic training for new employees and offers advanced and 
supplemental training courses to existing personnel within the 
Diversion Control Program to help them maintain the knowledge and 
skills necessary to conduct diversion investigations. Specifically, 
DEA's Office of Training provides a 12-week basic course to newly 
hired Diversion Investigator personnel, which includes techniques for 
diversion investigations among other relevant subjects, to help ensure 
that they have the required skills for performing investigator 
responsibilities.[Footnote 22] The training is provided through a 
combination of in-classroom lessons and practical application; direct 
observation; and instructor-to-trainee feedback. Course trainees must 
maintain an 80 percent average on exams and simulated on-site 
investigations in order to pass the course and be certified as a 
Diversion Investigator. After the completion of basic training, the 
investigators enter into duty under a 1-year probationary period with 
a midpoint review provided after 6 months of duty. In addition, 
according to DEA officials we spoke with, group supervisors may go on-
site with newly hired employees to help ensure that they are familiar 
with the requirements of investigations. 

DEA also requires its Diversion Investigators to complete an advanced 
(or in-service refresher) training course every 2 years to help ensure 
their investigative skills and knowledge remain current. The advanced 
training course is a 1-week course that focuses on current legal 
issues in diversion, recent updates to DEA program policies and 
technology, investigative techniques, and any other new initiatives or 
programs that DEA has incorporated as part of the diversion control 
program within the previous 2 years. Officials in DEA's Office of 
Training told us that the topics that are covered during the advanced 
training course are identified through a biannual survey of Diversion 
Investigators and group supervisors to find out what issues they are 
facing in their work or what additional guidance is needed. DEA's 
efforts to help ensure Diversion Investigators maintain their 
investigative skills and are informed of new program initiatives and 
program policy changes are consistent with federal internal controls 
standards which state that training should be aimed at developing and 
retaining employee skill levels to meet changing organizational needs. 

Beyond the required basic and advanced training courses, Diversion 
Investigators and supervisors may take additional courses in other 
relevant subject matter areas as time, resources, and needs permit. 
For example, officials in DEA's Office of Training told us that they 
offer specialized courses on specific issues related to diversion 
control investigations such as interviewing techniques, chemical 
investigations, techniques for financial investigations, and asset 
forfeiture, among others. Furthermore, the Diversion Control Program's 
field divisions may occasionally sponsor supplemental training for 
personnel that they determine would be beneficial. Typically, such 
training is shorter in duration and narrowly focused on topics such as 
report writing, interviewing techniques, or legal or investigative 
issues specific to that division. 

Group supervisors of Diversion Investigators also receive supervisory 
training to help ensure that they have the requisite knowledge to 
perform their supervisory responsibilities, including those 
responsibilities related to reviewing the work of Diversion 
Investigators. Specifically, when first promoted, supervisors attend a 
supervisory institute to learn their new roles and responsibilities as 
supervisors as well as receive training in management and leadership 
techniques. Group supervisors also have electronic access to 
PowerPoint presentations, handouts, and administrative manuals to help 
guide them in carrying out these responsibilities once they return to 
duty. As with the Diversion Investigators, supervisors also receive a 
1-week advanced supervisor refresher course every 2 years. 

Special Agents assigned to the Diversion Control Program are also 
provided training related to conducting criminal diversion 
investigations. The training for Special Agents includes a 1-week 
course to provide them with an in-depth understanding of criminal 
diversion investigations and includes instruction on methods of 
diversion, Internet investigations, and the investigative techniques 
to develop criminal investigations, among other issue areas related to 
diversion control. 

Furthermore, DEA's Office of Diversion Control recently developed and 
implemented a new training curriculum designed to retrain and retool 
all Diversion Investigators. According to DEA officials, as the 
reorganization of the diversion program required Diversion 
Investigators to conduct more regulatory investigations than 
previously, the retraining was developed to refresh the investigators' 
skills and abilities for conducting the investigations. DEA officials 
reported that as of December 2010, all Diversion Investigators 
completed this training. These efforts are consistent with federal 
internal control standards which provide that training should help to 
retain employee skill levels in order to meet changes in 
organizational needs. 

To assess the effectiveness of its training courses, officials in 
DEA's Office of Training stated that they obtain student feedback on a 
training course evaluation form at the conclusion of each training 
course. Additionally, DEA training officials review the curriculum for 
basic Diversion Investigator training every 3 years using feedback 
from students and input from a training working group comprised of 
Diversion Investigators and group supervisors to ensure that the 
material being presented is relevant and up to date. DEA officials 
also reported that the Office of Training is in constant communication 
with diversion management staff at headquarters and in the field to 
ensure that the training curriculums include updated policies relating 
to diversion operations. 

DEA's monitoring process did not identify widespread or systematic 
problems with the quality of investigations: 

As DEA continues to enhance its diversion control efforts, it is 
important that it has controls in place to review the quality of its 
diversion investigations and to test the effectiveness of its review 
process in order to readily identify and resolve deficiencies related 
to its key compliance activity. Standards for internal control in the 
federal government provide that internal control monitoring should 
assess the quality of performance over time and ensure that findings 
of audits and other reviews are promptly resolved. DEA's internal 
control monitoring activities collectively are consistent with these 
standards, which also state that internal controls should generally be 
designed to assure that ongoing monitoring occurs in the normal course 
of operations. Internal control monitoring includes regular management 
and supervisory activities among other activities and is performed 
continually. DEA has implemented a multilayered approach to monitor 
the work of its Diversion Control Program personnel to help ensure 
that they are following policies and procedures for diversion 
investigations. The monitoring process includes direct supervisory 
review, self-inspection/peer review, and on-site internal inspection. 
Additionally, DEA assesses the effectiveness of its monitoring process 
by reviewing the results of inspections conducted as a part of the 
overall program evaluation responsibilities of DEA's Office of 
Inspections (IN) and determining actions necessary for improvement and 
additional employee training needs. Furthermore, DEA's 2009-2014 
Strategic Plan reflects that the agency plans to use the Office of 
Inspections to help ensure effective and efficient program oversight 
through its on-site inspections. 

DEA field division supervisory officials reported that they directly 
review employee work products to assess the extent to which employees 
are following required policies and procedures for diversion 
investigations. Specifically, these supervisory officials review 
reports and active case files submitted by their employees for 
completeness, accuracy, and adherence to reporting procedures. If any 
discrepancies are found that need to be corrected, feedback is 
provided to employees as appropriate detailing what needs to be 
revised or clarified. Additionally, supervisory officials in three of 
the five field divisions we spoke with reported that they maintain 
regular communication to help ensure that employees are completing 
investigations in an accurate and timely manner. DEA officials also 
reported that group supervisors work with Diversion Investigators on- 
site when necessary to help advise them on the appropriate steps to 
take during an investigation. Whenever a case is being elevated for 
disciplinary action (civil or criminal), Division management presents 
a summary of the case to the program manager detailing the facts and 
rationale for the disciplinary action. Division management reviews the 
case summary and determines approval for further action (e.g., 
prosecution). 

In addition to direct supervisory review of work products, DEA's 
Office of Inspections also has a Self-Inspection Program (SIP) in 
which DEA field divisions are required to conduct annual self-
inspections of five major program areas: enforcement management; 
enforcement effectiveness; financial management; confidential source 
management; and evidence. According to the DEA officials we spoke 
with, during the on-site inspection process, field division group 
supervisors inspect each others' group case files to determine if 
investigations were conducted in accordance with required policies and 
procedures. Supervisory officials in all five field divisions we spoke 
with stated that they conduct the self-inspections on an annual basis. 
The results of the self-inspection reports are reviewed by the Office 
of Inspections. According to DEA's 2009-2014 Strategic Plan, 
information related to the SIP is used as the starting point for the 
Office of Inspection's cyclic, on-site inspections. 

The Chief of the Diversion Control Program's Regulatory Section 
reported that field division officials submit to headquarters for 
review a copy of the investigative reports for every regulatory 
investigation that has been conducted.[Footnote 23] DEA officials then 
conduct a quality review of these reports which assists them in 
identifying deficiencies and determine the training needs of diversion 
personnel as they relate to completing regulatory investigations. The 
chief of the Diversion Control Program's Regulatory Section stated 
that if report errors are identified during the review process, 
officials in the Regulatory Section follow up with the respective 
field division to address the issue and submit supplemental report 
information. 

The Office of Inspections also conducts on-site internal inspections 
of DEA's 21 field divisions to ensure that employees are following 
required program policies and procedures--in accordance with the 
Diversion Investigator manual. The office's primary objective for on- 
site inspections of the diversion control program is to determine how 
the diversion control work is being conducted by the field divisions 
and identify and address any problems. According to the Chief 
Inspector the Office of Inspections, it is the Office of Inspection's 
goal to conduct on-site inspections every 3 years as resources allow. 
See figure 3 for a description of the steps involved in the internal 
inspection report process: 

Figure 3: Description of On-Site Internal Inspection Process: 

[Refer to PDF for image: illustration] 

Factors for case file selection: 

IN selects the files for review based on a number of factors: (1) the 
field division makeup; (2) number of registrants within the field 
division portfolio; and; (3) makeup of the registrants such as the 
number of importers and exporters, manufacturers and distributors, 
among others. 

Case file selection: 

IN selects a representative sample of cases from each population of 
registrants as well as those registrants included in regulatory, 
criminal, and complaint investigations to review. 

Case file review: 

During on-site inspections, IN staff looks at files in conjunction 
with what the diversion manual requires for a particular type of 
investigation. IN staff verify that the case file records meet the 
policy requirements for the particular type of investigation involved. 

Final report issued: 

IN’s on-site inspections of field division programs provide a rating 
of effective or not effective to determine the field division’s 
enforcement, operational, and management effectiveness. 

IN has three categories of deficiencies related to its on-site 
inspections: (1) on-site corrections which include minor items such as 
missing signatures or dates in the files; (2) recommendation(s)--areas 
for improvement but are not tied to a violation or policy; and (3) 
finding(s)--violations of policy. 

Source: DEA's Office of Inspections. 

[End of figure] 

According to DEA officials, the Office of Inspections briefs 
headquarters-level management about the issues identified, and sends 
the report to the field division. For findings, the field division 
then has 60 days to provide a written response about the corrective 
actions that the field division has taken or plans to take. DEA 
officials also reported that they use internal inspections as an 
internal management tool to review their areas of responsibility. We 
reviewed DEA's most recent inspection reports available for each of 
its 21 field divisions which summarized the results of interviews with 
management and staff, reviews of program operations, and case files 
reviews for policy compliance, among other items.[Footnote 24] We 
found that the inspections did not identify widespread findings or 
issues related to the timeliness and overall quality of the diversion 
investigations. 

DEA Could Better Identify and Report on the Results of Its Diversion 
Control Efforts: 

Given DEA's increased focus on regulatory and criminal investigations 
in response to growing prescription drug diversion, it is critical for 
DEA to determine and report on the extent to which these additional 
efforts are helping to reduce diversion. In this regard, DEA has 
established performance measures to assess and report on its progress 
towards meeting its performance goal of reducing the diversion of 
licit drugs, but could enhance its set of performance measures to 
better capture and report on investigative outcomes and their results 
on diversion. We have previously reported that performance information 
can be used to help decide among competing priorities and allocate 
resources in a results-oriented management system.[Footnote 25] Such 
performance information allows program managers to compare their 
programs' results with goals and thus help determine where to target 
resources to improve performance. In addition, one of the key 
characteristics of successful hierarchies of performance measures is 
the ability of the measures to demonstrate how well a program is 
achieving its goals.[Footnote 26] As shown in table 2, DEA has 
developed five measures to track and publicly report the progress and 
results of its efforts in reducing the diversion of licit drugs. 

Table 2: Performance Measures for DEA's Diversion Control Program: 

* Milestones for development, implementation, and maintenance of the 
Rapid Targeting Online Reports Tool (RapTOR). 

* Number of Diversion Priority Target Organizations (PTOs)[A] not 
linked to Consolidated Priority Organization Target (CPOT)[B] targets 
disrupted/dismantled[C]. 

* Number of Diversion PTOs linked to CPOT targets disrupted/dismantled. 

* Number of planned scheduled regulatory investigations completed. 

* Number of Administrative/Civil/Criminal Sanctions. 

Source: DEA. 

Notes: 

[A] Priority Target Organizations are defined as drug trafficking 
organizations with an identified hierarchy engaged in the highest 
levels of drug trafficking and/or drug money laundering operations, 
having a significant international, national, regional, or local 
impact upon drug availability. According to DEA, the disruption or 
dismantlement of the organization will have a significant impact upon 
drug trafficking and/or money laundering activities and warrant the 
dedication of significant resources to achieve this end. 

[B] Consolidated Priority Organization Targets (CPOTs) are defined as 
the command and control element of a major international drug 
trafficking organization and/or money laundering enterprise that 
significantly impacts the U.S. drug supply as identified by Organized 
Crime Drug Enforcement Task Forces member agencies. An organization is 
considered "linked" to a CPOT, if credible evidence exists of a nexus 
between the primary target of the investigation and a CPOT target. 
With the nature of the Diversion program, linkages to these 
international drug trafficking and money laundering organizations are 
a rare event. 

[C] According to DEA, a disruption is defined as significantly 
impeding the normal and effective operation of a targeted 
organization, as indicated by changes in organizational leadership, 
trafficking patterns, drug production methods, etc. Examples of this 
may be seen in changes in price/purity of the drug or changes in 
methods of operation; increases in fees paid to couriers or 
transporters; movement of the organization to a neighboring district; 
and/or a reduction in availability of a drug on the streets, even if 
only temporarily. Dismantlement is defined as destroying the 
organization's leadership, financial base, and drug supply network 
such that the organization is incapable of operating and/or 
reconstituting itself. 

[End of table] 

According to DEA program officials, these measures were selected as a 
result of a performance measure review by the Department of Justice 
(DOJ) in 2009. For this review, DOJ asked all of its components to 
reexamine their performance measures to identify and discontinue 
performance measures that were confusing or did not adequately reflect 
the core mission. In place of such measures, DOJ asked the components 
to develop five core measures that are easy to understand and explain 
what is being accomplished with the resources expended. Our analysis 
of the measures found that while some indicate results, such as the 
number of organizations disrupted or dismantled that were involved in 
diverting prescription drugs, when taken together, the set of measures 
does not clearly demonstrate to what extent the additional efforts DEA 
has made in investigations in recent years are having an effect on the 
diversion problem. As a result, the set of measures do not clearly 
explain how they demonstrate progress towards the overall program 
performance goal of reducing diversion. DEA program officials 
acknowledged that these measures do not fully reflect the results of 
the program towards the reduction of diversion and as a result, they 
do not rely on them exclusively for managing the program or 
determining where best to allocate program resources. They stated that 
for the purposes of internal program planning and management, they 
have access to and utilize other data and measures not reported, or 
can pull up additional information on investigative results that 
provide more detail on what the program is achieving towards the 
reduction of diversion. 

Overall outcome measure does not demonstrate program results: 

DEA has designated an overall outcome measure to track the results of 
the diversion control program as a whole; however, this measure does 
not demonstrate program results.[Footnote 27] This measure--Milestones 
for Development, Implementation, and Maintenance of Data Warehouse to 
Monitor Closed Distribution System--tracks the development of an 
information warehouse system DEA is developing for use in diversion 
investigations. According to DEA officials, when completed, this 
warehouse--known as the Rapid Targeting Online Reports Tool (RapTOR)-- 
will facilitate data and trends analysis as part of diversion 
investigations. DEA officials explained that RapTOR is intended to 
streamline the investigation process by providing a comprehensive data 
warehouse tool that is linked to other DEA databases such as ARCOS, 
the drug theft/loss reporting system, and a system that tracks the 
number of asset forfeitures, arrests, and other enforcement data. 

While the RapTOR appears to hold promise as a useful tool in diversion 
investigations, tracking the milestones of its development as the 
outcome measure for the overall diversion program does not demonstrate 
results or capture outcomes from the program as a whole as it is only 
one project within the program. According to OMB guidance to agencies 
on preparing strategic plans and performance reports, outcome measures 
are to describe the intended result of carrying out a program and 
define an event or condition that is external to the program and is of 
direct importance to the intended beneficiaries or the public. 
[Footnote 28] While tracking milestones for the RapTOR's deployment 
may be useful as project-specific outcome measures, due to their 
focused nature they do not provide information on results of the 
diversion control program as a whole. For instance, reporting on 
RapTOR's testing and deployment status does not provide program 
management or other decision makers such as Congress information to 
indicate the results of DEA's regulatory and criminal investigations 
are having towards the reduction of diversion of licit drugs, the 
program's performance goal. Development of an outcome measure that 
more directly demonstrates the external results of the overall program 
could provide better information to DEA program managers and other 
decision makers such as Congress about program successes which could 
also help determine how to most effectively use resources. According 
to DEA's fiscal year 2012 budget submission, the RapTOR will allow for 
the development of an outcome measure. When asked if they planned to 
develop an outcome measure to replace the RapTOR, DEA officials 
indicated that until RapTOR is fully developed and implemented, it 
would be too soon to tell when a replacement outcome measure would be 
necessary. Furthermore, DEA officials could not explain how they use 
the RapTOR measure to show overall program results or outcomes or how 
it will be used to develop a measure that reports such results or 
outcomes. 

Performance measures tracking investigations of priority targets 
demonstrate results: 

Two of DEA's performance measures track results DEA has achieved 
through criminal investigations of priority targets. In April 2001, 
DEA implemented the Priority Target Organization (PTO) program as a 
strategic initiative to identify, target, investigate, and disrupt or 
dismantle drug trafficking and/or money laundering organizations 
having a significant impact on drug availability within the United 
States. Although the Diversion Control Program was not officially part 
of the DEA's Priority Targeting Program prior to fiscal year 2010, 
with the creation of Tactical Diversion Squads in every domestic DEA 
field division, the Diversion Control Program has since begun focusing 
on the identification of PTOs and their eventual disruption and 
dismantlement. 

DEA has two separate measures to track the number of PTOs disrupted 
and dismantled--one for those with identified links to Consolidated 
Priority Organization Targets (CPOTs) and another for those without 
links to CPOTs. As a participant in the PTO program, the Diversion 
Control Program is required to report on these performance measures. 
Whereas PTOs are organizations with an identified hierarchy engaged in 
drug trafficking or drug money laundering operations, CPOTs are the 
command and control elements of a major international drug trafficking 
organization and/or money laundering enterprise that significantly 
impacts the U.S. drug supply. An example of a diversion PTO cited by 
DEA officials was a practitioner who prescribed large quantities of 
controlled substance pharmaceuticals for nonmedical purposes to 
"patients" from at least five different states. DEA officials stated 
examples of CPOTs involved in diversion include international chemical 
distributors that traffic in chemicals used to manufacture 
methamphetamine while other CPOTs traffic in pharmaceuticals or 
counterfeit pharmaceuticals. 

Specifically, these measures report the extent to which DEA disrupted 
(disrupt) or stopped (dismantle) the operations of PTOs and these 
organizations' ability to divert controlled substances, which helps to 
reduce the diversion of licit drugs, the program's overall performance 
goal.[Footnote 29] For example in fiscal year 2010, DEA reported that 
it disrupted one PTO with linkages to a CPOT and dismantled one PTO 
with CPOT linkages. For PTOs without linkages to a CPOT, DEA reported 
disrupting 96 and dismantling 65 in fiscal year 2010. According to DEA 
officials, the PTO-related measures are useful in helping the program 
to focus criminal investigations on those priority targets against 
which they are likely to have the greatest impact on the diversion of 
licit drugs. 

Other performance measures do not clearly demonstrate results of 
regulatory investigations: 

While DEA has some performance measures to demonstrate the results of 
its criminal investigations, it lacks measures that clearly track 
resulting outcomes DEA has achieved through its additional regulatory 
investigations. For example, DEA has a measure that provides a 
numerical count of the scheduled or regulatory investigations 
completed. According to DEA's Fiscal Year 2009-2014 Strategic Plan, 
one of the objectives for the diversion control program is to ensure 
98 percent compliance of all registrants by fiscal year 2014. However, 
while the performance measure is focused on the regulatory 
investigations and provides a count of the number of investigations 
completed, this measure does not demonstrate the results of those 
completed investigations or give a sense as to the extent to which 
registrants were found to comply with the CSA and thereby the extent 
to which DEA is achieving its stated objective. According to DEA 
officials, while they previously reported on the compliance rate of a 
subset of wholesale registrants as the program's outcome measure, the 
reexamination of program performance measures in 2009 resulted in 
discontinuing use of the measure. DEA officials stated that because 
the compliance level among registrants tends to be very high in 
general, the values of the measure did not significantly change from 
year to year. Consequently, they stated, the measure did not provide a 
meaningful gauge of the results regulatory investigations were having. 
However, DEA data reported before it discontinued use of this measure 
showed that the compliance rate, while always relatively high, 
fluctuated between 88.5 percent to as high as 97.7 percent between 
fiscal years 2003 and 2008. Further, as stated in DEA's strategic 
plan, one of the key objectives of the program is to ensure a certain 
level of compliance among registrants.[Footnote 30] Without the 
reporting of a measure that directly tracks a level of compliance 
among registrants, the public and other external stakeholders such as 
Congress will not be able to determine the extent to which DEA is 
achieving that specific objective. In addition, given that DEA more 
than tripled the number of regulatory investigations conducted from 
fiscal year 2009 to fiscal year 2010 including investigations of 
previously excluded registrant groups as well as increasing the 
frequency of investigations for a rapidly growing DWP registrant 
group--it will be important for DEA to be able to assess and report on 
the potential results these additional investigations are having on 
regulatory compliance. 

In addition, the other performance measure reports on the number of 
sanctions DEA has taken against diverters or noncompliant registrants 
over the past year. As such, it is one indicator of the results of DEA 
investigations. However, as it is a count of the sanctions, it only 
demonstrates the number of sanctions taken, but does not provide 
context as to the severity of the sanctions or the reason for the 
sanctions. For example, administrative sanctions resulting from 
deficiencies in a registrant's recordkeeping found during regulatory 
inspections may reflect a lack of compliance with the CSA but not 
necessarily instances of actual diversion. In contrast, criminal 
sanctions, such as prison time given to an individual or registrant 
for diversion of controlled substances, reflect sanctions taken 
against actual diversion that has occurred and identified during a 
criminal investigation. Because the sanctions are tallied together for 
the performance measure, it is difficult to determine to what extent 
they have resulted from regulatory noncompliance issues or instances 
of criminal diversion. 

Another difficulty with combining the total number of administrative, 
civil, and criminal sanctions in one total is that changes in the 
number of the respective type of penalties mean different things in 
terms of what they indicate about the potential risk for diversion. 
For example, an increase in the number of criminal sanctions resulting 
from DEA's criminal investigations indicates that individuals or PTOs 
involved in diversion have been disrupted or dismantled, reducing the 
potential risk for future diversionary activities, and is therefore a 
desirable change. However, an increase in the number of administrative 
sanctions resulting from regulatory investigations could indicate a 
trend of rising noncompliance among registrants, which is an 
undesirable change as it implies that DEA's outreach efforts with 
industry may not have been effective and the potential risk for 
diversion is higher as a result of registrants' noncompliance. As a 
result, this measure does not provide a clear indication as to the 
effect DEA's investigative efforts are having on the problem of 
diversion. By tracking sanctions resulting from regulatory 
noncompliance combined with sanctions resulting from criminal 
diversion, program managers and other decision makers may lack 
information on what type of noncompliance is increasing and be able to 
determine what adjustments to the program's efforts, if any, might be 
necessary to address the root causes of increases in the number of 
sanctions. 

DEA officials acknowledged that this measure by itself is not detailed 
enough to provide that information. However, they stated they 
supplement the measure for internal program planning and management 
functions by conducting analyses that separate out the different types 
of sanctions and provide more meaningful data on the sanctions to 
identify diversion trends, determine the results of their efforts, and 
inform future program plans and policy decisions. Officials also noted 
that providing a single count of sanctions without breaking them out 
helped simplify the measure and meet DOJ's goal of limiting the number 
of overall performance measures to five. While this may be more 
manageable for the purpose of providing performance information, the 
measure does not clearly tie to outcomes and demonstrate program 
performance--a key goal of DOJ's performance measure reexamination 
effort--and does not provide sufficiently meaningful information and 
data to external stakeholders and policy makers such as Congress about 
the types of sanctions DEA has taken as a result of both regulatory 
and criminal investigations. 

Conclusions: 

The growing problem of controlled substance diversion presents a 
serious and constantly evolving threat to public health and safety. In 
responding to this threat, DEA faces a unique challenge in being 
proactive to investigate and stop the diversion of controlled 
prescription drugs and substances, while at the same time, ensure that 
individuals with legitimate needs and uses for such substances can 
obtain them. In recent years, DEA has taken steps to adjust its 
approach to increase its efforts in conducting regulatory and criminal 
investigations to facilitate registrant compliance with the CSA and 
enhance coordination and leverage the resources and abilities of other 
federal, state, and local partners when conducting investigations into 
criminal diversion. Given the steps DEA has taken, it is important for 
DEA management to track the results its efforts are having against 
diversion in order to determine what benefits are being realized and 
what, if any, adjustments need to be made to make them more effective. 

DEA has established a set of performance measures for the program, but 
the link between most of the measures and how they demonstrate the 
progress DEA is making towards the overall goal of reducing diversion 
is unclear. Making more meaningful information available externally 
about the program's results would enable program managers and external 
stakeholders to better understand what the program is accomplishing 
and provide more effective oversight. By developing an outcome measure 
that demonstrates programwide results of benefit to the public and 
revising other performance measures to better track and report on the 
results of investigations and their results on reducing diversion of 
prescription drugs, DEA could make the measures more effective for 
demonstrating results. Doing so could also provide DEA program 
managers and other decision makers such as Congress better information 
to target program approaches accordingly to further optimize results 
against diversion. 

Recommendation for Executive Action: 

In order for DEA to better determine to what extent its efforts are 
decreasing diversions and to inform future program decisions, we 
recommend that the Administrator of DEA strengthen the agency's 
performance measurement for the Diversion Control Program by 
reassessing its set of performance measures for the program to 
identify ways to enhance the measures and their link to the program 
outcome goal of reducing diversion. 

Agency Comments and Our Evaluation: 

We requested comments on a draft of this report from DOJ. DEA provided 
written comments, which are summarized below and reprinted in full in 
appendix I. In its comments, DEA stated it would take action to 
address the recommendation to strengthen its set of performance 
measures for the Diversion Control Program but that it disagreed with 
the finding that its performance measures do not adequately measure 
how its efforts reduce diversion or that such deficiencies impede 
resource allocation decisions. In an e-mail received on August 4, 
2011, the Acting Assistant Director of DOJ's Audit Liaison Group 
clarified DEA's position stating that DEA did not concur with the 
recommendation. 

In its comment letter and attachment, DEA stated that the report 
demonstrated that its management is appropriately directing its 
resources towards key points of diversion and confirms that DEA has 
been successful in accomplishing its objectives. DEA reiterated that 
performance measures must be viewed within the context of other 
information to assess the results that DEA efforts have on public 
health and safety as well as the reduction of diversion. To this end, 
DEA stated that its leadership provides policy makers and legislators 
information though a variety of other sources such as budget requests, 
intelligence reports, briefings, and testimonies. They also noted that 
the majority of such information presented to policy makers is based 
on investigative data and intelligence which is broader in scope than 
performance measures. In regards to developing or implementing 
measures to track regulatory performance, DEA stated that further 
strengthening the current performance measures to include regulatory 
performance measures would not provide any additional benefit in 
assisting the agency or other decision makers in the allocation of 
resources or targeting of program approaches to further optimize 
results. DEA stated that it would be extremely difficult to do so 
because the vast majority of registrant inspections do not uncover 
serious violations of the CSA and thus a very small number of 
registrants are subject to sanctions during the annual inspection 
cycle. Further, DEA stated that the deterrent effect of regulatory 
investigations cannot be quantified making it impossible to measure 
the lack of diversion resulting from DEA's efforts. 

As the report indicates, we recognize that DEA has taken steps to 
allocate resources and position the program to respond to emerging 
diversion trends. However, the report does not state that DEA 
management has appropriately directed its resources or confirm that 
DEA has been successful in accomplishing its objectives. The review on 
which this report is based describes how DEA manages its 
investigations to address the growing and evolving nature of diversion 
and did not evaluate those actions for their efficiency or 
effectiveness as implied by DEA. At the same time, as our evidence did 
not suggest that DEA's use of current performance measures has 
directly impeded its resource allocation decisions to date, we made 
changes to the report to minimize any inference of such a finding. 
Moreover, the fact that a program may appear well managed on the basis 
of anecdotal and qualitative evidence does not negate the need or 
obligation for an agency to develop and use performance measures that 
hold it accountable for determining, articulating, and reporting what 
a program is accomplishing. 

As performance measurement is a key part of an agency being results- 
oriented, that is, tracking and being held accountable for the results 
or outcomes an agency produces through its programs, our 
recommendation is intended to ensure that the program's performance 
measures meet the standards for performance measures established by 
DOJ and OMB and are the best measures possible to demonstrate and 
report the program's results to program management, other external 
decision makers such as Congress, as well as the public. We agree that 
program managers and decision makers can and should use other relevant 
program information in addition to performance measures when 
allocating resources and making program decisions. However, this also 
does not negate the need or obligation for an agency to develop and 
use performance measures that meet the standards established by DOJ 
and OMB. On the basis of our evaluation of the program's performance 
measures against the guidance and criteria for performance measures 
provided by DOJ and OMB, as well as our previous work on performance 
measurement, we believe that further refinements to the program's 
performance measures are merited and have the potential to help make 
the measures provide more useful information on the achievements of 
the program. 

Because many outside parties, such as industry members and the 
American public, may not have access to other contextual information 
DEA may provide policy makers and legislators, refinement of the 
current set of program performance measures could enable DEA to better 
assess and externally report on the results of the program in a more 
meaningful and understandable way. As DOJ guidance to component 
agencies suggests, performance measures should clearly articulate what 
an agency is accomplishing with the resources used in language 
outsiders can understand. Some of the key measures DEA is using do not 
meet this standard. For example, according to DEA, tracking the 
milestones for the development, implementation, and maintenance of the 
program's Rapid Targeting Online Reports Tool (RapTOR) was chosen as 
the program's outcome measure so that managers could monitor the 
development and implementation of the system to ensure it was done in 
a timely and cost-efficient manner. While we agree that project 
schedule and cost should be closely monitored, this measure does not 
articulate to outsiders what the program is accomplishing as called 
for by DOJ's guidance for performance measures. Further, given that 
the RapTOR is an internal data warehouse tool DEA is developing, the 
reporting of milestones for the development, implementation, and 
maintenance of the tool does not provide an overall indicator of 
success for DEA's diversion program or its stated goal of reducing the 
diversion of licit drugs. As a result, it also does not meet OMB's 
criteria that requires outcome measures to describe or capture an 
event or condition external to the program that is of importance to 
the public. Indeed, DEA program officials could not describe how they 
use this measure more broadly beyond tracking the progress of the 
project itself. 

In regards to developing or implementing a performance measure to 
track the impact of the regulatory inspection process, we disagree 
with DEA that including a regulatory performance measure would not 
provide any additional benefit. DEA stated that it would be extremely 
difficult to develop such a measure because the vast majority of 
registrant inspections do not uncover serious violations and thus 
sanctions are taken against a very small number of registrants. While 
this may be the case, reporting the number of administrative, civil, 
and criminal sanctions taken as a single count as DEA currently does, 
does not provide perspective as to how many sanctions are a result of 
regulatory infractions and how many are a result of criminal 
infractions. Also, as DEA points out, the severity of sanctions and 
their impacts can vary greatly ranging from requiring on-site 
corrections by a registrant for minor infractions to DEA pursuing 
legal sanctions against a registrant which could have a profound 
effect on the wider registrant population as a whole. Given the 
differences between regulatory sanctions and criminal sanctions and 
the potential severity of different sanction types, we continue to 
believe it would be useful for DEA to develop a measure that 
separately tracks the results of regulatory investigations or the 
number and severity of regulatory sanctions taken for identified 
infractions. With such a measurement, more information would be 
available to program managers, other decision makers, and the public 
on what type of noncompliance, if any, is increasing and thereby 
decision makers would be better able to determine what adjustments to 
the program's efforts, if any, might be necessary to address the 
causes of increases in the number of sanctions. 

In terms of tracking the lack of diversion or similarly, the reduction 
in diversion resulting from DEA's efforts, DEA stated that it would be 
impossible to measure. However, given that one of the key program 
objectives DEA identified in its strategic plan is ensuring a level of 
compliance with the CSA among DEA registrants, whose compliance in 
turn directly maintains the closed system of distribution established 
by the CSA, it is important that DEA have a performance measure that 
directly links to this objective. We and OMB have acknowledged the 
difficulty in developing measures for programs that aim to deter or 
prevent specific behaviors, and have reported that in such instances 
proxy measures should be designed to assess the effectiveness of 
program functions. Proxy measures can be used to assess the 
effectiveness of program functions rather than directly assess the 
effectiveness of the program. In this regard, one possible approach 
DEA could use is to develop a proxy measure that tracks the compliance 
rate of wholesale registrants based on the results of regulatory 
investigations completed that year. Also, OMB has pointed out, it may 
be necessary to have a number of proxy measures to help ensure 
sufficient safeguards are in place to account for performance results. 

Given the significant and growing problem of the diversion and abuse 
of pharmaceutical-controlled substances in the United States, having a 
set of performance measures that clearly conveys the accomplishments 
of the Diversion Control program is perhaps even more important now. 
By reassessing the program's current performance measures and making 
changes where necessary to the measures, DEA will be in a better 
position to provide enhanced information to program managers, other 
decision makers such as Congress, and the public on the extent to 
which the program is achieving its stated longer range performance 
goal of reducing diversion. 

DEA also provided technical comments, which we incorporated as 
appropriate. 

As agreed with your office, unless you publicly announce its contents 
earlier, we plan no further distribution of this report until 30 days 
from its issue date. At that time, we will send copies of this report 
to interested congressional committees, the Attorney General, the 
Administrator of the DEA, and other interested parties. In addition, 
the report will be made available at no charge on GAO's Web site at 
[hyperlink, http://www.gao.gov]. 

If you or your staff have any questions concerning this report or wish 
to discuss the matter further, please contact me at (202) 512-8777, or 
larencee@gao.gov. Contact points for our Offices of Congressional 
Relations and Public Affairs may be found on the last page of this 
report. Key contributors to this report are listed in appendix II. 

Signed by: 

Eileen Regen Larence: 
Director, Homeland Security and Justice Issues: 

[End of section] 

Appendix I: Comments from the Drug Enforcement Administration: 

U.S. Department of Justice: 
Drug Enforcement Administration: 
Springfield, Virginia 22152: 
[hyperlink, http://www.dea.gov] 
 
July 28, 2011: 

Eileen Larence, Director: 
Homeland Security and Justice Issues: 
441 G Street, N.W. 
Washington, D.C. 20548: 

Subject: GAO Draft Report Prescription Drug Control: DEA Has Enhanced 
Efforts to Combat Diversion, But Could Better Assess Efforts (GAO-11-
744): 

Dear Ms. Larence: 

On July 1, 2011, the Government Accountability Office (GAO) provided 
the draft report Prescription Drug Control: DEA Has Enhanced Efforts 
to Combat Diversion, But Could Better Assess Efforts (GA0-11-744) to 
the Department of Justice (DOJ) and the Drug Enforcement 
Administration (DEA) for official agency review and comment. 

DEA is pleased with GAO's overall positive review of the Diversion 
Control Program and its acknowledgment of the many efforts the agency 
has taken on both the criminal and regulatory aspects of controlling 
the diversion of pharmaceuticals and listed chemicals. The GAO report 
describes many of the extensive actions DEA has taken to address the 
escalating problem of the diversion of prescription drugs. The GAO 
report highlights some of DEA's recent accomplishments such as 
Operation Pill Nation which is designed to address the plethora of 
rogue pain clinics in south Florida. 

The report contains one Recommendation for Executive Action: 

In order for DEA to better determine to what extent its efforts are 
decreasing diversions and to inform future program and investments 
decisions, we recommend that the Administrator of DEA strengthen the 
agency's performance measurement for the Diversion Control Program by 
reassessing its set of performance measures for the program to 
identify ways to enhance the measures and their link to the program 
outcome goal of reducing diversion. 

DEA disagrees with the assertion that DEA does not adequately measure 
how its efforts reduce diversion, or that such deficiencies impede 
resource allocation decisions. 

Reducing prescription drug abuse requires a multi-faceted approach 
which includes education, treatment, and enforcement. With respect to 
the latter, the performance measures used by DEA to track disruptions 
and dismantlements of Diversion PTO investigations and administrative, 
civil, and criminal sanctions represent more than just numbers. 

As outlined in the attached detailed response, the specter of 
increased scheduled regulatory investigations and proactive 
educational efforts have a deterrent effect that cannot be measured by 
raw data; it is impossible to measure the lack of diversion. These 
actions help prevent future diversion as well as maintain the closed 
system of distribution established by Congress through the Controlled 
Substances Act. 

In addition, our investigations expose or identify new and evolving 
trends in diversion which demand tailored, multi-faceted responses. 
Diversion trends may require new or innovative investigative methods 
or the re-allocation of resources. For example, a reorganization of 
the Office of Diversion Control expanded the use of Tactical Diversion 
Squads in order to raise the stakes for criminal activities at all 
levels of diversion, and increased administrative oversight in order 
to emphasize compliance, educate registrants, and reinforce the 
deterrent effect of regulatory investigations. This reorganization was 
prompted by the rising tide of prescription drug abuse.Other diversion 
trends may identify the need for new legislation to keep pace with 
emerging technologies such as the Ryan Haight Act, or regulations 
that authorize electronic prescribing for controlled substances and 
disposal opportunities for members of the public. Yet other trends 
may call for new training or equipment as was the case with rogue 
Internet pharmacies. 

The GAO report clearly demonstrates that management is appropriately 
directing its resources towards key points of diversion and towards 
those individuals or organizations directly responsible for large-
scale diversion. Consequently, the direct and indirect outcomes from 
our performance measures are very apparent. They arc a means by which 
the Agency sets priorities, directs resources, identifies new trends, 
formulates budgets, works with other agencies to develop national 
strategies, educates the public and industry, develops training 
curriculum, and provides Congress with technical assistance towards 
new legislation. The investigations conducted by DEA help reduce the 
supply of drugs diverted and the ways in which drug seekers/addicts 
acquire their drugs that might not otherwise occur in the absence of 
such investigations. But more importantly, these investigations and 
administrative actions help reduce diversion and the negative impact 
drug diversion has on families, the local community, the medical 
community, the economy, and overall public health and safety. 

DEA will follow up with GAO on a course of action to address the 
recommendation included in the report. DEA will continue to work 
closely with DOJ and the Office of National Drug Control Policy 
to improve its performance measures consistent with the National 
Drug Control Strategy. DEA is also committed to providing Members 
of Congress with information on the agency's efforts or information 
on diversion as needed. 

Sincerely, 

Signed by: 

Joseph T. Rannazzisi: 
Deputy Assistant Administrator: 
Office of Diversion Control: 

[End of letter] 

DEA's Response to GAO's Report (GA0-11-744): 
Prescription Drug Control DEA Has Enhanced Efforts to Combat 
Diversion, But Could Better Assess Results to Inform Investments: 

The Drug Enforcement Administration (DEA) appreciates the opportunity 
to respond to GAO's report cited above. 

Performance measures provide a structure for an agency to become 
results-oriented. This is done through a process of identifying and 
eliminating fragmentation, improving the strategic planning process 
and ensuring sound fiscal responsibility. This is precisely what the 
GAO found after their 14-month long investigation of the DEA Diversion 
Control Program. 

GAO stated in their report that in addressing the increase in illegal 
diversion of controlled substance pharmaceuticals, DEA has expanded 
its resources by combining separate and sometimes disparate Federal, 
state and local information, authorities, and enforcement programs.
GAO noted in their report that in doing so, DEA has maximized 
resources, improved investigative efforts, improved communication and 
coordination, and simplified information sharing. The GAO report also 
documented how DEA has increased the frequency of regulatory 
investigations by more than three-fold between fiscal years 2009 and 
2010. GAO also pointed to the fact that DEA has established internal 
controls that ensure investigators follow policies and procedures when 
conducting diversion investigations. Furthermore, these efforts are 
consistent with Standards for control in the Federal Government, which 
states that agency management should help to ensure it has a workforce 
that has the required skills that match those necessary to achieve 
organizational goals."[Footnote 1] GAO investigators also reviewed 
DEA's internal inspection reports and stated that they did not find 
any systemic issues relating "to the timeliness and overall quality of 
diversion investigations."[Footnote 2] 

From their extensive investigation, GAO determined that DEA's use and 
expansion of Tactical Diversion Squads, "...has been a means to 
improve communication and coordination and simplify information 
sharing as the squads have become the clearinghouse for diversion-
related investigative information."[Footnote 3] GAO acknowledged that 
the Tactical Diversion Squads have vastly improved law enforcement's 
ability to investigate diversion cases. Specifically, GAO stated, 
"...participating in the squad has enabled local law enforcement 
agencies to carry out more complex investigations into diversion 
within their localities" and "...prior to the establishment of squads, 
they did not have the resources on their own to carry out the longer, 
more complex investigations required for targeting higher level 
diverters such as physicians and their clinics."[Footnote 4] "The 
squads provided a means for state and local law enforcement to 
collectively pool their resources together with DEA to investigate 
higher level diverters."[Footnote 5] "As a result, information is now 
shared more rapidly and broadly between law enforcement agencies." 
[Footnote 6] These investigations are designed to ensure that 
registrants comply with all aspects of the Controlled Substances Act 
(CSA) and its accompanying regulations thereby reducing diversion. 

The GAO report, however, represents a dichotomy. The report is replete 
with details explaining how DEA's Office of Diversion Control has set 
priorities, improved the allocation of its resources in an efficient 
and effective manner, and joined together fragmented systems. Their 
report further provides examples that clearly demonstrate successful 
results from these actions. But after laying out all of this 
information, GAO contradicts itself by stating "performance 
information can be used to help decide among competing priorities and 
allocate resources in a results-oriented management system." They 
further state that, "DEA could better identify and report on the 
results of its diversion control efforts." However, DEA's performance 
measures are used effectively by the agency to set priorities, direct 
limited resources, identify new trends, formulate budgets, work 
efficiently and effectively with other agencies, help develop national 
strategies, educate the public and industry, develop training 
curriculum, and provide Congress with technical assistance towards new 
legislation. 

DEA representatives advised GAO investigators that DEA's performance 
measures are not myopically focused solely on raw statistics. 
Diversion investigations are aimed at reducing and stopping the flow 
of controlled substances and listed chemicals into the illicit market. 
These investigations do not benefit from purely numerical performance 
measures. Accordingly, DEA's performance measures align themselves 
with the goals and objectives of the Administration's National Drug 
Control Strategy, DEA's Strategic Plan, and DEA's statutory 
obligations. More importantly, these performance measures must be 
viewed in their entirety to assess the full impact or results they 
have on public health and safety as well as the reduction in the 
diversion of controlled substances and listed chemicals. In fact, 
decision-makers, members of Congress and the general public do not use 
performance measures in isolation. Statistical performance measures 
are but one component in the decision-making process. They are linked 
to budget requests, strategic plans, investigative reports, and other 
types of information that help make educated decisions and improve 
performance. 

DEA representatives explained to the GAO investigators that the effect 
its investigations and regulatory oversight has on the diversion 
problem is attained through a variety of information that is a direct 
result of its performance measures. DEA investigations stop those who 
are diverting controlled substance pharmaceuticals and prevent them 
from future diversion of these substances. 

* To illustrate this point, in 2007, the Office of Diversion Control 
initiated Operation Lightning Strike which resulted in the service of 
Immediate Suspension Orders (ISOs) on eight rogue pharmacies that were 
illegally distributing controlled pharmaceuticals via the Internet. 
This operation resulted in the seizure of 907,328 dosage units of 
hydrocodone and enough bulk hydrocodone to yield an additional 600,000 
dosage units. Two other pharmacies voluntarily terminated their DEA 
registrations. In 2006, these ten pharmacies had collectively 
purchased 45 million dosage units of hydrocodone which was 64 times 
the amount ten legitimate pharmacies would normally dispense during a 
one-year period. 

As traffickers adapt to new laws or exploit advancements in 
technology, DEA must also adapt. Today, the problem of rogue domestic 
Internet pharmacies has virtually disappeared due to the passage of 
the Ryan Haight Act, which placed severe restrictions on how DEA 
registrants can prescribe and dispense controlled substances via the 
Internet. Traffickers immediately adapted, and rogue pain clinics 
(RPLs) began to flourish throughout Florida, Texas and California. 
RPLs operate under the guise of providing "pain management" or 
"medical treatment" but in reality are just storefronts for drug 
trafficking. The prescriptions issued and pharmaceuticals dispensed 
are not prescribed for a legitimate medical purpose and the 
physicians, health practitioners and clinic owners are feeding the 
addictions of thousands of drug seekers by diverting millions of 
dosage units of controlled substances that inevitably enter the 
illicit marketplace. 

The damage caused by these operations is staggering. The Florida 
Medical Examiner's Office has reported a 248% increase between 2005 
and 2009 in the number of overdose deaths associated with oxycodone, 
the primary drug distributed via the pill mills. This data further 
shows an average of 3.2 persons dying every day in Florida from an 
oxycodone overdose. 

DEA and state and local law enforcement have taken action through 
priority target initiatives such as Operation Pill Nation, a series of 
investigations targeting rogue pain clinics in Florida. As of July 1, 
2011, this operation resulted in the closure of 40 rogue clinics, the 
arrest of 36 individuals, the seizure of approximately S 18.9 million 
in assets, and the surrender of 95 DEA registrations. Closing these 
clinics and causing the surrender of these registrations will clearly 
reduce diversion. DEA has identified and reported on the results of 
these and other diversion control efforts through Congressional 
briefings and testimony, budget requests, and media reports/releases. 

Priority Target Organizations (PTOs) Disrupted or Dismantled as a 
Performance Measure: 

DEA uses PTO investigations as a performance measure to ensure that 
the resources and investigative efforts of the agency are focused on 
the highest level of trafficker. From their investigation, GAO 
concluded that "performance measures tracking investigations of 
priority targets demonstrate results."[Footnote 7] 

PTO investigations are established when investigators identify 
organizations that are engaged in high levels of drug trafficking 
and/or money laundering or are causing significant problems on the 
local, regional, national or international level. The disruption or 
dismantlement of such organizations will impact their ability to 
divert controlled substance pharmaceuticals or listed chemicals. 

PTO investigations often involve multiple jurisdictions; the outcome 
can therefore be wide-ranging and substantial, and can include 
positive results in several ways, The criminal acts committed by these 
organizations negatively affect the quality of life within a given 
community. Drug trafficking organizations and drug abusers are often 
linked to other criminal activities such as robberies, burglaries, 
drugged driving, and even deaths in their communities. These criminal 
organizations cause significant economic burdens within their 
communities such as loss of productivity, and strains on judicial 
systems and social and health care services. This was demonstrated by 
a study conducted by the University of Washington which reported that 
the economic costs in the United States from the non-medical use of 
prescription opioids for 2006 were estimated at $53.4 billion ($42 
billion due to loss of productivity; $8.2 billion in criminal justice 
costs; $2.2 billion in treatment costs and $944 million in medical 
complications).[Footnote 8] Removing or reducing sources of diversion 
drastically eliminates drug addicts'/drug seekers' ability to sustain 
any such activity and thereby reduces their burden on society. 

Scheduled regulatory investigations and Administrative/Civil/Criminal 
Sanctions: 

GAO reported that while DEA's performance measures for its criminal 
investigations demonstrate results, its performance measures for 
regulatory investigations do not. GAO stated that "without the 
reporting of a measure that directly tracks a level of compliance 
among registrants, the public and other external stakeholders such as 
Congress will not be able to determine the extent to which DEA is 
achieving that specific objective."[Footnote 9] DEA believes that the 
totality of the facts and circumstances must be taken into account to 
discern the outcome of any performance measurement. 

Congress intended for DEA to enforce all aspects of the Controlled 
Substances Act (CSA) and its implementing regulations. DEA conducts 
regulatory inspections/investigations on certain registrants to ensure 
that they are in compliance with the CSA. If the inspection reveals 
violations of the CSA, the registrant can be held accountable through 
administrative, civil, or criminal sanctions. Registrants subject to 
routine cyclical inspections include, but are not limited to, certain 
practitioners, importers, wholesalers, distributors, or manufacturers. 

On-site inspections are an important component of the DEA regulatory 
program and its oversight of the registrant population. However, 
criminal, civil and administrative sanctions are taken against a very 
small number of registrants during the annual regulatory inspection 
cycle. In fact, the vast majority of controlled substance registrants 
do not want to jeopardize their controlled substance registrations and 
potentially their businesses by violating provisions of the
CSA. Generally speaking, the registrant population complies with the 
CSA and its implementing regulations. In many cases, cyclical 
inspections of facilities are utilized to point out potential 
weaknesses in security, recordkeeping or inventory practices and 
provide the regulatory oversight to bring the registrant into 
compliance. In many cases, the violations found are nothing more than 
minor infractions that can be corrected on-site. However, when DEA 
does pursue legal sanctions against a registrant, that action has a 
profound effect on the registrant population as a whole, resulting in 
better industry compliance while also identifying potential weaknesses 
in the closed system of distribution. It is extremely difficult to 
develop or implement a performance measure to track the impact of the 
regulatory inspection process, especially when the vast majority of 
registrant inspections do not uncover serious violations of the CSA. 

However, there are other regulatory programs that can illustrate a 
dramatic impact on controlled substance diversion. For example, as 
part of the regulatory oversight process, DEA developed and 
implemented a Distributor Initiative Program to help controlled 
substance wholesalers/distributors understand their regulatory and 
statutory obligations concerning controlled substance transactions. 
This was done initially to cut off the flow of controlled substances 
to rogue Internet pharmacies but was expanded to address the increase 
and proliferation of rogue pain clinics that dispensed medications as 
well as pharmacies that serviced these clinics. This program has 
resulted in the registrants developing improved due diligence 
processes to assist in their ability to identify suspicious orders. 
This regulatory education program resulted in the discontinuation of 
controlled substance sales to approximately 1,300 suspicious 
customers, proactively preventing the diversion of controlled 
substances into the illicit market. 

Still, within the last two years, it was necessary for DEA to take 
administrative and civil action against several wholesaler/ 
distributors who continued to disregard their obligations under the 
CSA and supply large quantities of controlled substances to rogue pain 
clinics operating in Florida, Legal action against these distributors 
resulted in a significant decline in oxycodone sales in Florida, thus 
reducing diversion. 

In summary, the specter of scheduled regulatory investigations and the 
above-mentioned proactive educational efforts have a deterrent effect 
that cannot be measured by raw data; it is impossible to measure the 
lack of diversion. These actions help prevent future diversion as well 
as maintain the closed system of distribution established by Congress 
through the Controlled Substances Act. It should he noted that our 
entire regulatory workforce was provided with the most up-to-date 
training concerning the regulatory investigative process during the 
last two years. This course was developed to enhance the performance 
of our diversion investigators as they take on a more focused role in 
regulatory oversight of DEA registrants. 

Rapid Targeting Online Reports Tools Performance Outcome Measurement: 

As stated above, performance measurements are used as a tool to 
improve an agency's overall performance. This can be done in a variety 
of ways, such as improving work productivity, eliminating 
fragmentation, and employing cost-cutting measures. This is the reason 
that the Diversion Control Program developed the Rapid Targeting 
Online Reports tool (RapTOR). By leveraging technology, the agency 
will utilize RapTOR to link together fragmented database systems 
thereby streamlining and improving the investigative process. This 
performance measure was selected so that managers could monitor the 
development and implementation of this system to ensure that it was 
done in a timely and cost-efficient manner. 

Conclusion: 

GAO recommends that DEA strengthen the agency's performance 
measurement for the Diversion Control Program that would link to the 
program outcome goal of reducing diversion. GAO states that developing 
better performance measures "could also provide DEA program managers 
and other decision-makers such as Congress better information to 
allocate resources or target program approaches accordingly to further 
optimize results against diversion."[Footnote 10] 

Over the last several years, the Diversion Control Program has evolved 
to address the ever changing face of pharmaceutical controlled 
substance diversion. These changes were made by well-informed managers 
and decision-makers who authorized the allocation of resources and 
altered the face of the program to adapt to changing trends and 
trafficking patterns of pharmaceutical controlled substance 
distribution. While we understand the importance of performance 
measures, we respectfully believe further strengthening the current 
performance measures to include regulatory performance measures would 
not provide any additional benefit in assisting the agency or other 
decision makers in the allocation of resources or target program 
approaches to further optimize results against diversion. The 
programmatic changes to the Diversion Control Program in the last 
several years and highlighted in the GAO report, were made, in part, 
due to the previous and current performance measures. 

DEA provides Congress with detailed budget requests and supporting 
information to justify such requests. The justification for resource 
allocation is not limited to performance measures. For example, DEA's 
decision to expand its use of the Tactical Diversion Squads was 
predicated on the need for a job series which had full law enforcement 
authorities (Special Agents and Task Force Officers as opposed to 
Diversion Investigators) and the need to combine disparate agencies 
for a more effective and efficient means of addressing drug diversion. 
GAO's 14-month investigation confirms that DEA has been successful in 
accomplishing these objectives. 

DEA leadership provides policy makers and legislators with requisite 
information though a variety of means including intelligence reports, 
congressional briefings, testimony, and briefings to executive staff 
within the Administration. The information presented during these 
briefings may include performance measures. However, fixed performance 
measures tend to be narrow in scope and could reflect trends that have 
already changed. The vast majority of information presented to policy 
makers is based on the collection and analysis of a wide range of 
investigative data and intelligence. This broader scope of information 
is far more beneficial in providing insight to leadership concerning 
decisions in the direction of resource allocations and programmatic 
changes. 

Reducing prescription controlled substance abuse requires a multi-
faceted approach which includes education, treatment, and enforcement. 
With respect to the latter, the performance measures used by DEA to 
track disruptions and dismantlements of Diversion PTO investigations 
and administrative, civil, and criminal sanctions represent more than 
just numbers. 

The intricacies of our investigations expose or identify new or 
evolving trends which produce various outcomes. These trends may 
require the need for new or innovative responses or the allocation of 
resources such as the need to expand the use of Tactical Diversion 
Squads and the need to focus on enhanced regulatory oversight. The 
trends may identify the need for new legislation to keep pace with 
emerging technologies such as the Ryan Haight Act or regulations that 
authorize electronic prescribing for controlled substances. These 
trends may require new training or equipment as was the case with 
rogue Internet pharmacies. 

The GAO report clearly demonstrates that management is appropriately 
directing its resources towards key points of diversion and towards 
those individuals or organizations directly responsible for large-
scale diversion. Consequently, the direct and indirect outcomes from 
our current performance measures are very apparent. They are a means 
by which the agency sets priorities, directs resources, identifies new 
trends, formulates budgets, works with other agencies to develop 
national strategies, educates the public and industry, develops 
training curriculum, and provides Congress with technical assistance 
towards new legislation. The investigations conducted by DEA help 
reduce the supply of drugs diverted and the ways in which drug 
seekers/addicts acquire their drugs that might not otherwise occur in 
the absence of such investigations. But more importantly, these 
investigations and administrative actions help reduce diversion and 
the negative impact drug diversion has on families, the local 
community, the medical community, the economy, and overall public 
health and safety. 

DEA will continue to review its performance measures for the Diversion 
Control Program and make any necessary adjustments to ensure that 
these measures are appropriate and that they are designed to provide 
the public, stakeholders, policy makers and members of Congress with 
the requisite knowledge to make informed decisions. 

Appendix I Footnotes: 

[1] GAO report p. 24. 

[2] GAO report p. 30. 

[3] GAO report p. 16. 

[4] GAO report p. 16. 

[5] GAO report pp. 15 & 16. 

[6] GAO report p. 16. 

[7] GAO report, p. 34. 

[8] Clinical Journal of Pain, December 2010, University of Washington, 
Hansen RN; Oster, G; Edelberg, J; Woody, GE; and Sullivan, SD. 

[9] GAO report p. 36. 

[10] GAO report p. 39. 

[End of section] 

Appendix II: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Eileen R. Larence, (202) 512-8777, or larencee@gao.gov: 

Acknowledgments: 

In addition to the contact named above, Kirk Kiester, Assistant 
Director, and Christopher Hatscher, Analyst-in-Charge, managed this 
assignment. Frances Cook, Vanessa Dillard, Sally Gilley, Jessica Orr, 
and Alechia Smith made significant contributions to the report. 

[End of section] 

Footnotes: 

[1] Pub. L. No. 91-513, tit. II, 84 Stat. 1236, 1242-84 (codified as 
amended at 21 U.S.C. §§ 801-890, 901-971). According to the CSA, the 
term "controlled substance" means a drug or other substance, or 
immediate precursor, that is included in one of five classification 
schedules. A controlled substance is placed in a respective schedule 
based on whether it has a currently accepted medical use in treatment 
in the United States and its relative abuse potential and likelihood 
of causing dependence. The order of the schedules reflects substances 
that are progressively less dangerous and addictive. The term 
"controlled substance" as used in this report includes controlled 
prescription drugs. 

[2] Substance Abuse and Mental Health Services Administration, Office 
of Applied Studies, The TEDS Report: Substance Abuse Treatment 
Admissions Involving Abuse of Pain Relievers: 1998 and 2008. 
(Rockville, Md.: July 15, 2010). 

[3] Given the limitations and uncertainties of the methods and sources 
used in this study, these results should be interpreted with caution 
and regarded as approximations only. See Ryan N. Hansen, Gerry Oster, 
John Edelsberg, George E. Woody, and Sean D. Sullivan, "Economic Costs 
of Nonmedical Use of Prescription Opiods," Clinical Journal of Pain, 
vol. 27, no. 3 (2011). 

[4] We have previously issued reports related to the diversion and 
abuse of prescription drugs. See GAO, Medicaid: Fraud and Abuse 
Related to Controlled Substances Identified in Selected States, 
[hyperlink, http://www.gao.gov/products/GAO-09-957] (Washington, D.C.: 
September 2009); GAO, Prescription Drugs: OxyContin Abuse and 
Diversion and Efforts to Address the Problem, [hyperlink, 
http://www.gao.gov/products/GAO-04-110] (Washington, D.C.: December 
2003); and GAO, Prescription Drugs: State Monitoring Programs Provide 
Useful Tool to Reduce Diversion, [hyperlink, 
http://www.gao.gov/products/GAO-02-634] (Washington, D.C.: May 2002). 

[5] We are currently conducting a separate review examining the trends 
in misuse and abuse of prescription pain relievers and how federal 
agencies, including DEA, educate the public and health care providers 
about misuse and abuse of such drugs. 

[6] We reviewed DEA's budget justification submissions for fiscal 
years 2008 to 2012 because we wanted to review the five most recent 
budget justifications available. 

[7] We reviewed DEA data on case volumes for investigations and data 
on the number of personnel working on DEA's Tactical Diversion Squads 
for fiscal years 2007 to 2010 because we wanted to focus our analysis 
on the most recent 4-year period. Tactical Diversion Squads are teams 
of DEA diversion personnel, as well as other federal, state, and local 
law enforcement personnel, whose mission is to detect, investigate, 
disrupt, and refer for prosecution, violators of federal and state 
controlled substance statutes pertaining to drug diversion. 

[8] GAO, Standards for Internal Control in the Federal Government, 
[hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1]  
(Washington, D.C.: November 1999). Internal control is an integral 
component of an organization's management that provides reasonable 
assurance that the following objectives are being achieved: 
effectiveness and efficiency of operations, reliability of financial 
reporting, and compliance with applicable laws and regulations. These 
standards, issued pursuant to the requirements of the Federal 
Managers' Financial Integrity Act of 1982 (FMFIA), provide the overall 
framework for establishing and maintaining internal control in the 
federal government. Also pursuant to FMFIA, the Office of Management 
and Budget issued Circular A-123, revised December 21, 2004, to 
provide the specific requirements for assessing the reporting on 
internal controls. Internal control standards and the definition of 
internal control in Circular A-123 are based on GAO's Standards for 
Internal Control in the Federal Government. 

[9] We reviewed the on-site internal inspection reports for DEA's 21 
field divisions for fiscal years 2005 to 2010 because we requested DEA 
to provide the most recent internal inspection report available from 
each field division. The inspection reports DEA provided in response 
to this request varied in date from fiscal year 2005 to 2010. 

[10] GAO, Executive Guide: Effectively Implementing the Government 
Performance and Results Act, [hyperlink, 
http://www.gao.gov/products/GAO/GGD-96-118] (Washington, D.C.: June 
1996); GAO, Agencies Annual Performance Plans Under the Results Act: 
An Assessment Guide to Facilitate Congressional Decisionmaking 
[hyperlink, http://www.gao.gov/products/GAO/GGD/AIMD-10.1.18] 
(Washington, D.C.: February 1998); and GAO, Tax Administration: IRS 
Needs to Further Refine Its Tax Filing Season Performance Measures, 
[hyperlink, http://www.gao.gov/products/GAO-03-143] (Washington, D.C.: 
November 2002). 

[11] 21 U.S.C. § 812. The act also authorizes the Attorney General to 
promulgate regulations adding, moving, or removing a drug or substance 
to, among, or from the five schedules established by the act after 
making certain findings specified by statute. 

[12] According to DEA officials, the locations for the additional 
squads were based on proximity to major cities, availability of office 
space within the DEA field divisions, the reported needs of local 
areas for a task force focused on diversion investigations, and the 
interest and ability of state and local law enforcement agencies to 
provide task force officers. 

[13] In October 1992, Congress passed the Departments of Commerce, 
Justice and State, the Judiciary and Related Agencies Appropriations 
Act of 1993 which changed the source of funding for DEA's Diversion 
Control Program from being part of DEA's congressional appropriation 
to full funding by registration and reregistration fees. The act 
required that the fees charged by DEA under its diversion control 
program be set at a level to recover the costs of operating the 
program. 

[14] DEA registrants (practitioner, hospital/clinic, retail pharmacy, 
and teaching institution) that fall under the business activity 
category "Dispensing or Instructing" pay a registration fee once every 
3 years. 

[15] These participants volunteered this information. Because these 
officials volunteered this information, we do not know the extent to 
which other squad officials share this view. 

[16] Pub. L. No. 106-310, tit. XXXV, 114 Stat. 1101, 1222-27 (2000). 

[17] 21 U.S.C. § 823(g). 

[18] These registrant types include manufacturers, bulk manufacturers, 
distributors, importers/exporters, and bulk importers. 

[19] 21 C.F.R. § 1301.74(b). 

[20] According to DEA officials, of the 60 Diversion Investigator 
positions requested for fiscal year 2011, as of May 2011, 34 positions 
have been allocated. 

[21] DEA headquarters officials told us that they are in the process 
of revising the Diversion Investigator and Special Agent manuals to 
address new laws, regulations, and policies concerning the Diversion 
Control Program and that they anticipate completing revisions to the 
manuals by fall 2011. 

[22] The Basic Diversion Investigator course is divided into five 
segments covering the following subject areas including: (1) an 
overview of diversion control, (2) techniques for diversion 
investigations, (3) the laws and regulations governing the Diversion 
Control Program, (4) an overview of chemical diversion control, and 
(5) criminal investigations. Within these segments, the training 
covers issues such as the policies and procedures for conducting 
different types of diversion investigations, documenting 
investigations, determining the appropriate sanctions to apply in 
cases of noncompliance, and processes for supervisory review of the 
work. 

[23] DEA's Regulatory Section (ODG) has oversight of regulatory 
matters under the Diversion Control Program (DCP) such as 
administrative or civil action taken against a registrant pursuant to 
the CSA and promulgated regulations. ODG also monitors field 
regulatory investigative activities such as periodic scheduled cyclic 
investigations, preregistration investigations, Order to Show Cause 
investigations, and drug theft/loss investigations, among other 
investigations. 

[24] The most recent reports available ranged in issue date from 
fiscal year 2005 to 2010. 

[25] [hyperlink, http://www.gao.gov/products/GAO/GGD-96-118]; GAO, 
Results-Oriented Government: Using GPRA to Address 21st Century 
Challenges, [hyperlink, http://www.gao.gov/products/GAO-03-1166T] 
(Washington, D.C.: Sept. 18, 2003); GAO, Results-Oriented Budget 
Practices in Federal Agencies, [hyperlink, 
http://www.gao.gov/products/GAO-01-1084SP] (Washington, D.C.: August 
2001); and GAO, Human Capital: Key Principles for Effective Strategic 
Workforce Planning, [hyperlink, http://www.gao.gov/products/GAO-04-39] 
(Washington, D.C.: December 2003). 

[26] As we discussed in our June 1996 guide on implementing the 
Government Performance and Results Act, we studied a number of leading 
public sector organizations that were pursuing management reform 
initiatives and becoming more results-oriented. As part of these 
initiatives we found leading organizations seek to establish clear 
hierarchies of performance goals and measures, linking the goals and 
performance measures for each organizational level to successive 
levels and ultimately to the organization's strategic goals. Based on 
this study of leading public sector organizations, we found that at 
least four characteristics are common to successful hierarchies of 
performance measures: (1) Demonstrate results; (2) Limited to the 
vital few; (3) Respond to multiple priorities; and (4) Link to 
responsible programs. As our focus of this review was on how DEA 
determines the results of its efforts against the diversion problem, 
we limited our analysis of DEA's performance measures to the 
characteristic of "Demonstrate results." 

[27] Performance measures may address the type or level of program 
activities conducted (process), the direct products and services 
delivered by a program (outputs), or the results of those products and 
services (outcomes). See [hyperlink, 
http://www.gao.gov/products/GAO-11-646SP]. 

[28] OMB Circular A-11 PART 6 Section 200.4, July 2010. 

[29] Under disruptions, registrants usually retain the DEA 
Registration with restrictions and/or financial penalty. Registrants 
may also be temporarily denied access to controlled 
substances/chemicals. Under dismantlements, registrants lose or 
forfeit their DEA Registration or are convicted of a drug felony. 
Registrants are permanently denied access to controlled 
substances/chemicals pending a reversal of circumstances. 

[30] DEA's Fiscal Year 2009-2014 Strategic Plan states that a 6-year 
objective for the program is to "ensure CSA compliance among 98 
percent of all registrants by the end of fiscal year 2014." 

[End of section] 

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