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Congress considers e-logbooks to further combat meth production

BY Michael Johnsen

ALEXANDRIA, Va. —For all the good last year’s Combat Meth Act has done—according to the Drug Enforcement Administration, it has significantly curbed homegrown production of methamphetamine—“meth-heads” and their dealers still might be able to source their methamphetamine precursors, namely pseudoephedrine, from local retail outlets.

On the home front, the Combat Meth Act is achieving its desired effect. “Since passage of various state legislative measures and the Combat Methamphetamine Epidemic Act…DEA has seen a significant decline in the number of clandestine methamphetamine laboratories across the United States,” stated Joseph Rannazzisi, deputy assistant administrator of the Drug Enforcement Administration, before the committee on Senate Finance last month, noting that there has been a 41 percent reduction from 2006 in the number of domestic meth labs. Initially, DEA had hoped for a 25 percent reduction in domestic meth labs.

The act has worked so well in part because it has effectively restricted distribution of cough-and-cold medicines through a finite number of retailers—a little more than 76,000, more than half of which are pharmacies, have been self-certified through the DEA Web site since the implementation last year of the Combat Meth Act—compared with the some 750,000 retail outlets that sold PSE products prior to the Combat Meth Act’s passing, the DEA stated citing data provided by the Consumer Healthcare Products Association. There are some 30,000 outlets that have not yet self-certified and are still selling PSE products, the DEA estimated, which is an issue the agency is attempting to address through informational mass mailings.

One confounding issue realized in the aftermath of the Combat Meth Act is the lack of an aggregate logbook database from which DEA and law enforcement can check to make sure PSE quantity restrictions are being effectively realized. “Though law enforcement can view the required logbooks, paper logbooks are difficult to effectively review and analyze,” Rannazzisi noted. “Electronic log-books, though not required under [the Combat Meth Act], are easier to review, but generally there is no connectivity between them within any given state and certainly not on an interstate basis. Due to this lack of connectivity, law enforcement has reported several cases of “smurfing”—defined as an individual or group of individuals traveling to multiple stores and purchasing quantities of pseudoephedrine or ephedrine products at or under the legal limit per store. Presently, the issue of connectivity is being addressed at the state level, although legislation recently has been introduced at the federal level.

Self-certified retailers registered with DEA

Source: DEA Senate testimony
Business type No. certified
Retail pharmacy 44,993
Gas/convenience 10,090
Convenience 7,294
Grocery 6,657
Club 3,005
Discount 2,922
Other 1,079
Total 76,040

“I’ve joined Sen. [Dick] Durbin, [DIll.], to close this ‘smurfing’ loophole,” announced Sen. Chuck Grassley, R-Iowa, during the Senate hearing. “The Methamphetamine Production Prevention Act of 2007 would amend the Combat Meth Act to allow for electronic logbook systems, and create a federal grant program for states looking to create or enhance existing electronic logbook systems.”

The National Association of Chain Drug Stores opposes any legislation regarding the mandate of electronic logbooks, however.

Peter Wolfgram, president and chief executive officer of Bungalow Drug, who testified before the Senate Finance Committee last month on behalf of NACDS regarding the ongoing problem of methamphetamine abuse, emphasized one issue NACDS has with electronic logbook mandates, though he did not address the e-log-books specifically—the necessity for a national standard. “One national standard for retail availability is important because a patchwork of requirements is confusing to consumers, law enforcement and retailers,” Wolfgram testified, referencing the multitude of PSE restrictions enacted by a number of states prior to the passage of the federal Combat Meth Act. “For chain pharmacies, which operate in practically every state, city, town and county in the country, it is complex and costly to have to create and update different policies, procedures and employee training programs for each pharmacy outlet.”

That argument also holds for electronic logbooks.

Already, one of the leading states in combating domestic meth production, Iowa, has plans in place to implement an electronic log-book mandate. “We are working on the state level to obtain passage of legislation that would allow us to implement a real-time electronic tracking system for pseudoephedrine sales, to address the loopholes that exist in the current law that has led to the practice of ‘smurfing,’” reported Gary Kendell, director of the State of Iowa Governor’s Office of Drug Control Policy.

But electronic logbooks could pose a number of problems to retailers, NACDS has stated in a position paper on its Web site, not the least of which is forcing a drug store clerk to risk good customer service by becoming an actual law-enforcement agent. “A mistake by a clerk or in the electronic logbook’s computer system may wrongfully indicate that an innocent purchaser has exceeded the legal limit and cause the clerk to mistakenly refuse to sell PSE products to that purchaser,” NACDS stated. “Moreover, it would place the clerk at risk for physical violence by dangerous methamphetamine cooks and addicts for refusing to conduct a sale.”

NACDS also expressed concern over the need for a national electronic log-book standard, which currently does not exist and without which would force multi-state retailers to develop myriad electronic logbook systems for each of the states in which they operate. “Pharmacies in Oklahoma have been told by the federal Drug Enforcement Administration that they may have to operate two separate logbooks in order to comply with both the federal and state requirements,” NACDS stated.

Bungalow Drug, an NACDS member since 2002, is a family-owned, hometown pharmacy chain based in Belgrade, Mont. The company provides pharmacy services for approximately 3,000 patients out of three locations in Montana with 24 employees, including eight full-and part-time pharmacists.

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Fred’s reports both monthly and quarterly record sales

BY Allison Cerra

MEMPHIS, Tenn. Fred’s Inc. reported record sales for the five-week and eight-month periods which ended Oct. 6, 2007.

The company said Friday that its total sales for the month increased 2 percent to $161.4 million compared to the same period last year. Total sales for the year-to-date period increased 5 percent to $1.157 billion.

Same store sales for the month rose 1 percent on top of a 5 percent increase in September last year. On a comparable store basis, sales increased 1.3 percent through the first eight months of fiscal 2007 compared with a 2.7 percent gain in the year-earlier period. Same-store sales are a key predictor of how well the company performs in stores that have been open for several years, and how well the newly open stores will do in the future.

“September sales came in at the low end of our forecasted range of a 1 percent to 3 percent increase, affected by unusually warm weather across our markets and the disruption caused by the updating of 98 stores under our refresher program,” said Fred’s Stores chief executive officer Michael J. Hayes. “We look forward to finishing our refresher program in October with the last 60 stores and to a better economic environment for our customers going forward, as the benefits of the minimum wage increase and the focus of Federal Reserve Board on the credit crunch take hold.”

Fred’s opened four stores at the end of September, bringing total store openings to 22 for the year-to-date period. These new store openings have been balanced by the company’s decision to close underperforming stores. In the remaining months, Fred’s Stores said that it plans to open 14 additional stores, with no further planned closings, which will result in a net increase in stores of 2 percent for the year.

Fred’s Inc. operates 702 discount general merchandise stores, including 24 franchised stores in the southeastern United States.

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Target to open another 61 stores nationwide

BY Allison Cerra

MINNEAPOLIS Target announced that it will be opening an additional 61 Target stores, the company said Friday.

The stores, which will all open Oct. 14, will open in 22 different states. The majority of the stores are making their debut in Arizona, California, Ohio and Texas.

In addition to offering the latest in trend-right merchandise, Target also brings a 44-year tradition of community involvement. The retail chain commits itself to local communities donating more than $3 million each week to area nonprofit organizations, becoming involved in local volunteerism efforts through Target Volunteers, and orchestrating other special projects that help meet area social service, arts and education needs.

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