Empower Pharmacy v. Iowa Board of Pharmacy ( 2023 )

IN THE COURT OF APPEALS OF IOWA
No. 22-0052
Filed February 8, 2023
EMPOWER PHARMACY,
Petitioner-Appellant,
vs.
IOWA BOARD OF PHARMACY,
Respondent-Appellee.
________________________________________________________________
Appeal from the Iowa District Court for Polk County, Celene Gogerty, Judge.
A pharmacy appeals the denial of its petition for judicial review challenging
administrative action of the Iowa Board of Pharmacy. AFFIRMED.
David L. Brown and Alexander E. Wonio of Hansen, McClintock & Riley,
Des Moines, for appellant.
Brenna Bird, Attorney General, and Laura Steffensmeier, Assistant Attorney
General, for appellee.
Heard by Bower, C.J., and Badding and Buller, JJ.
2
BADDING, Judge.
Empower Pharmacy appeals the denial of its petition for judicial review that
challenged adverse administrative action by the Iowa Board of Pharmacy for a
violation of Iowa Administrative Code rule 657-20.12, governing compound
preparations that are essentially copies of approved drugs. Empower argues the
district court erred in determining: (1) the rule is not unconstitutionally vague, (2) it
was afforded due process in the administrative proceeding, (3) the Board’s
decision was supported by substantial evidence, and (4) the sanction levied was
appropriate. We affirm.
I. Background Facts and Proceedings
To understand the relatively uncomplicated issues in this disciplinary
licensing proceeding, we must first wade into the more complicated world of drug
compounding. In pharmacist-speak, “[d]rug compounding is a process by which a
pharmacist or doctor combines, mixes, or alters ingredients to create a medication
tailored to the needs of an individual patient.” Thompson v. W. States Med.
Ctr., 535 U.S. 357, 360–61 (2002); accord Iowa Admin. Code r. 657-20.2(“‘Compounding’ means the combining, mixing, diluting, pooling, flavoring, or
otherwise altering of a drug or bulk drug substance to create a drug.”). According
to guidance from the Food and Drug Administration (FDA) contained in this agency
record,
Compounded drug products serve an important role for patients
whose clinical needs cannot be met by an FDA-approved drug
product, such as a patient who has an allergy and needs a
medication to be made without a certain dye, an elderly patient who
cannot swallow a pill and needs a medicine in a liquid form that is not
otherwise available, or a child who needs a drug in a strength that is
lower than that of the commercially available product.
3
That said, the same guidance recognizes compounded drugs “can also pose a
higher risk to patients” because those drugs “have not undergone FDA premarket
review for safety, effectiveness, and quality.”
State and federal regulation of drug compounding has waxed and waned
over the years until an incident in 2012, “in which a drug compounding center
‘produced contaminated injections that caused a meningitis outbreak, killing more
than 60 people and infecting hundreds more.’” Hope Med. Enters. Inc. v. Fagron
Compounding Servs., LLC, No. 2:19-cv-07748-CAS(PLAx), 2021 WL 4963516,
at *4 (C.D. Cal. Oct. 26, 2021) (citation omitted). To improve the “overall quality
and safety of compounded drugs following” that incident, Congress passed new
legislation in 2013 creating federal regulatory power over compounding firms,
consisting of amendments to section 503A (applying to pharmacies) and creating
section 503B (applying to a new category of drug makers called outsourcing
facilities) of the Food, Drug, and Cosmetic Act. Id. at *4–6. Iowa has since enacted
its own regulations on compounding, modeled after federal regulations and
guidance, which Empower Pharmacy (Empower) is alleged to have violated.
The regulation at issue—Iowa Administrative Code rule 657-20.12—
became effective on September 6, 2017.1 It limits “compound preparations that
are essentially copies of approved drugs” unless “the compounded preparation is
changed to produce for an individual patient a clinically significant difference to
1 A shorter version of the rule took effect in November 2015. The addition of
subparts (1) and (2) of the rule took effect on September 6, 2017.
4
meet a medical need as determined and authorized by the prescriber.” 2 Iowa
Admin. Code r. 657-20.12. Rule 657-20.12(1) sets forth factors the Iowa Board of
Pharmacy (Board) may consider “as an indication that a compounded preparation
is essentially a copy of an approved drug.” If the Board determines the
compounded preparation is essentially a copy, the prescription for the preparation
“shall clearly indicate the relevant change and the significant clinical difference
produced for the patient.” Id. r. 657-20.12(2).
Empower, whose headquarters are in Texas, is licensed as a non-resident
pharmacy in Iowa and several other states, including Oklahoma.3 In June 2018,
Empower consented to the imposition of a $37,200 civil penalty, plus two years of
probation, by the Oklahoma Board of Pharmacy for its compounding of human
chorionic gonadotropin (HCG).4 The agreed findings of fact in the order imposing
that penalty stated Empower “compounded . . . products that the [Oklahoma] Board
alleges are commercially available or essentially copies of commercially available
FDA approved drug products under Oklahoma law,” namely prescriptions of HCG
in 11,000 units per vial and 5,000 units per vial. According to the order, “HCG
injection in 5,000 units per vial is commercially available” and “HCG injection in
11,000 units per vial is essentially a copy of the HCG 10,000 units/vial.” The order,
2 The rule also allows compound preparations that are essentially copies of
approved drugs “if the approved drug is identified as currently in shortage on the
FDA drug shortages database.” This part of the rule is not at issue.
3 Empower is also licensed in Iowa as an outsourcing facility. See Iowa Code
§ 155A.13C (2018); Iowa Admin. Code r. 657-41.3. This proceeding only involves
Empower’s pharmacy license.
4 HCG is an FDA-approved, commercially available, and prescription-only drug
used to treat fertility issues in women and hormonal issues in men. It is also used
for weight loss, though that use has not been approved by the FDA.
5
which deferred disciplinary action against Empower pending completion of
probation, noted Empower “neither admitted nor denied violating” applicable
Oklahoma law.
Empower immediately notified the Board of the agreed order in Oklahoma
although, in doing so, it asserted that its conduct complied with FDA guidance and
inspections. Even so, Empower told the Board that once it was “made aware that
Oklahoma considered the products essential copies, Empower immediately
ceased compounding them.” Upon receiving this notification from Empower, an
investigation was opened by Board compliance officer and licensed pharmacist,
Sue Mears.
During her investigation, Mears reviewed dispensing records from
September 6, 2017, the date rule 657-20.12 became effective, through the end of
calendar year 2017. She learned that during that timeframe, Empower dispensed
the same formulations of HCG that were the subject of the Oklahoma order—5000
and 11,000 units per vial—to twenty-two Iowa patients. While Empower
supposedly ceased compounding these formulations after the Oklahoma non-
disciplinary action, it continued to dispense “slightly modified” formulations of HCG
to sixteen of those twenty-two patients in Iowa throughout 2018. Specifically,
“[p]atients previously receiving an HCG 5,000 IU formulation instead received an
HCG 6,000 IU formulation in 2018. Likewise, patients previously receiving an HCG
11,000 IU formulation instead began receiving an HCG 12,000 IU formulation in
2018.”
In late 2018 and early 2019, the Board requested prescription records from
Empower. In reviewing the first batch of information, Mears concluded there were
6
“nine prescriptions which could potentially be considered essentially copies of
approved products.” Not one of those prescriptions, according to Mears,
“contained patient-specific documentation for why the compounded medication
was being prescribed when an FDA-approved product would have been available,”
which “indicate[s] the pharmacy does not routinely ensure such patient-specific
documentation is provided on such prescriptions as required by board rules.”
Exhibit E of the investigative report shows that four of these prescriptions were for
HCG. The bottom of the first prescription provides the following language:
The compounded medications listed are made at the request
of the prescribing practitioner whose signature appears above due
to the medical need of a specific patient and the preparation is
prescribed because the practitioner has determined that the
preparation will produce a clinically significant therapeutic response
compared to a commercially[5]
The third prescription provides a similar notice; the second and fourth do not.
The Board requested a second batch of prescription records to assess
Empower’s “dispensing of HCG formulation following the Oklahoma order.” This
included records for eight of the sixteen patients who continued to receive HCG
from Empower in 2018 in slightly different formulations. A review of the records
disclosed that “none of the prescriptions provided patient-specific documentation
for the need for the compounded formulation instead of an FDA-approved
formulation.” Exhibits F and G of the investigative report show this batch of records
included sixteen prescriptions for HCG, eight of which included a boilerplate
5 If there was any other language, it was cut off at the bottom of the page. The
third prescription, discussed next, has “available product” at the end of its notice.
7
notification on a clinically significant difference, and eight of which included no such
notification.
In February 2019, Mears advised Empower of what her investigation had
disclosed and requested the pharmacy
to provide a response to [its] lack of patient-specific documentation
on each prescription for a compounded preparation which is
essentially a copy of an approved drug as well as the pharmacy’s
reason or justification in asserting that it has discontinued production
of a formulation when, in reality, it has continued production of
essentially the same formulation . . . just in a different volume.
In its response, Empower stated it had not been disciplined for its
compounding by any other states and the compounds complied with FDA guidance
and inspections. It then asserted that it
does not believe that its compounded formulations are in fact
“essentially copies” or “copies” of approved or otherwise
commercially available drugs. Specifically, the active
pharmaceutical ingredients in the products that Empower
compounds do not have the same, similar or easily substitutable
dosage strength as the approved drug product that is commercially
available.
Yet Empower’s own “account setup form” for prescribers listed its formulations of
HCG on its “essential copy list” of FDA-approved products.
In July 2019, the Board issued a statement of charges and notice of hearing
against Empower for one count of “compounding essentially copies of approved
drugs,” in violation of Iowa Administrative Code rule 657-20.12. The statement of
charges included these facts:
3. In 2017 and 2018, [Empower] shipped [HCG] in the
following formulations to Iowa patients: 5,000 IU; 6,000 IU; 11,000
IU; and 12,000 IU.
4. FDA-approved HCG is commercially available in 5,000 IU
and 10,000 IU formulations.
8
5. Based on the factors described in 657 IAC 20.12(1),
[Empower’s] HCG preparations are essentially copies of the
commercially available products.
6. [Empower’s] prescription documentation did not clearly
indicate the relevant change and the significant clinical difference
produced for the patient as required by 657 IAC 20.12(2).
After several continuances, a hearing before the Board was held in March
2021. Mears was the sole witness at the hearing, and several exhibits were
admitted. Through this evidence, the Board learned that FDA-approved
formulations of HCG come in multi-dose vials of 5000 and 10,000 volume units in
a powder form. Mears explained that patients who use HCG mix the powder “with
a diluent . . . to create a solution that then they can withdraw the amount for the
dose and inject it.” Mixing the HCG powder with the diluent to reach the desired
dosage for injection is called reconstitution.
On whether Empower’s preparations of HCG in 5000, 6000, 11,000, and
12,000 units are essentially copies of the commercially available product,
rule 657-20.12(1) provides:
The board may consider the existence of the following factors
as an indication that a compounded preparation is essentially a copy
of an approved drug:
a. The compounded preparation has the same active
pharmaceutical ingredient(s) as the commercially available drug
product;
b. The active pharmaceutical ingredient(s) has the same,
similar, or an easily substitutable dosage strength; and
c. The commercially available drug product can be used by
the same route of administration as prescribed for the compounded
preparation.
As to the first and third factors, Mears testified Empower’s compounded
formulation has the same active pharmaceutical ingredient as the commercially
available HCG and both are administrated through injection. For the second factor,
9
Mears explained how the dosage of Empower’s compound, when properly
reconstituted and regardless of the units per vial, also has the same dosage
strength as the commercially available drug.6 She added that Empower’s
assertion that its dosage was different was incorrect because they changed both
the amount of powder and diluent provided, which would not result in a change of
the dosage strength.
Following the hearing, the parties submitted written closing arguments. The
State argued Empower compounded essential copies of an approved drug and did
not meet either exemption provided in rule 657-20.12. As a result of the violation,
the State recommended formal citation, warning, a civil penalty, and probation. In
its brief, Empower argued for the first time that “the State failed to provide due
process with lack of proper notice” because it was unaware of what conduct the
Board considered a violation of the rule. Second, Empower argued rule 657-20.12
“is unconstitutionally vague” because it only provides that the Board “may”
consider certain factors in determining whether a compound is an essential copy.
Lastly, Empower argued “the State failed to prove a violation by a clear
preponderance of the evidence.”
6 Using Empower’s compound preparation of HCG in 6000 units as an example,
Mears testified that if it was reconstituted with six milliliters of bacteriostatic water,
as one of the prescriptions directed, the resulting concentration “would have been
6,000 units of drug within the six milliliters of liquid solution, so 1,000 units per
milliliter.” That particular patient was to inject “[p]oint five milliliters,” or “500 units,”
which, as Mears explained, could be achieved using the commercially available
5000-unit vial: “They would have reconstituted it with five milliliters of their diluent
and then still injected a half a milliliter of the resulting solution to get their 500-unit
dose.”
10
In its ruling, the Board rejected Empower’s as-applied due process claim,
finding it had sufficient notice about what conduct was alleged to be in violation of
the administrative rule. The Board preserved Empower’s facial constitutional
vagueness claim for judicial review. As to the rule violation itself, the Board found
“Empower’s compounded HCG is an essential copy of a[n] FDA-approved
formulation.” After finding the first and third factors in rule 657-20.12(2) were
undisputed, the Board rejected Empower’s argument under the second factor “that
its HCG preparation is 20% stronger than the commercially available drug
products.” The Board explained that
argument ignores the fact that HCG powder, unlike other drugs,
requires dilution and reconstitution by the end patient. Therefore,
although Empower may have provided stronger preparations of HCG
to patients than what is commercially available, the patients did not
need to receive such a high preparation. In every case, a patient
who received Empower’s compounded HCG formulation could have
had their dosages and needs met by the commercially available HCG
product by simply mixing different amounts of the bacteriostatic water
with the HCG drug. . . . The fact that patients could have their
medical needs met by a commercially available product but instead
received unregulated, compounded formulations by Empower is
preci[sely] the type of conduct prohibited by [rule 657-20.12].
The Board also found Empower did not meet the exception that authorizes
compounding of essential copies to produce a clinically significant difference to
meet a medical need and did not meet the documentation requirements of rule
657-20.12(2). For the violation, Empower received a citation and warning, was
ordered to “cease shipping compounded HCG preparations into Iowa,” placed on
three years of probation, and assessed a civil penalty of $25,000.
Empower petitioned for judicial review. In its ruling denying the petition, the
district court rejected Empower’s claims that the administrative rule is
11
unconstitutionally vague, its due process rights were violated, the Board’s
determination was not supported by substantial evidence, and the sanctions were
unreasonable. Empower appeals, raising these same claims.
II. Standard of Review
“Judicial review of agency decisions is governed by Iowa Code section
17A.19” (2021). Brakke v. Iowa Dep’t of Nat. Res., 897 N.W.2d 522, 530
(Iowa 2017) (citation omitted). The district court acts in an appellate capacity in
judicial-review proceedings. Iowa Med. Soc’y v. Iowa Bd. of Nursing, 831
N.W.2d 826, 838 (Iowa 2013). On appeal, this court “appl[ies] the standards of
section 17A.19(10) to determine if we reach the same results as the district court.”
Brakke, 897 N.W.2d at 530 (citation omitted). If so, “we affirm; otherwise, we
reverse.” Des Moines Area Reg’l Transit Auth. v. Young, 867 N.W.2d 839, 842
(Iowa 2015) (citation omitted). Relief in a judicial-review proceeding is appropriate
only “if the agency action prejudiced the substantial rights of the petitioner and if
the agency action falls within one of the criteria listed in section 17A.19(10)(a)
though (n).” Brakke, 897 N.W.2d at 530.
III. Analysis
A. Vagueness
For its first claim on appeal, Empower argues “the district court erred in
determining Iowa Administrative rule 20.12 is not unconstitutionally vague.” See
Iowa Code § 17A.19(10)(a) (allowing for relief when agency action is “based upon
a provision of law that is unconstitutional on its face or as applied”). The
vagueness doctrine is a concept of due process and is rooted in the “rough idea of
fairness.” Sloman v. Bd. of Pharmacy Exam’rs, 440 N.W.2d 609, 611 (Iowa 1989).
12
A statute[7] offends the Due Process Clause if it does not give
a person of ordinary intelligence a reasonable opportunity to know
what is prohibited so that he may act accordingly. It meets the
constitutional test if the meaning of the words used can be fairly
ascertained by reference to similar statutes, other judicial
determinations, reference to the common law, to the dictionary, or if
the words themselves have a common and generally-accepted
meaning.
Id. (quoting Miller v. Iowa Real Est. Comm’n, 274 N.W.2d 288, 291 (Iowa 1979)).
However, “[a] presumption of constitutionality exists that must be overcome by
negating every reasonable basis on which the statute can be sustained.” Devault
v. City of Council Bluffs, 671 N.W.2d 448, 451 (Iowa 2003).
Notably, the administrative rule at issue is civil—rather than criminal—in
nature. “Although the presumption of validity is operable in both criminal
and civil statutes, the relevant test of vagueness differs.” Miller, 274 N.W.2d
at 291. When considering civil statutes, “the test for vagueness is less stringent:
‘Even if more specific language could be devised, it is apparent the absence of
criminal sanctions requires less literal exactitude to comport with due process;
unless the statute clearly, palpably and without doubt infringes the constitution it
will be upheld.’” Sloman, 440 N.W.2d at 611 (quoting Miller, 274 N.W.2d at 292).
“[I]n the field of regulatory statutes governing business activities, where the acts
limited are in a narrow category, greater leeway is allowed.” Id. (quoting
Papachristou v. City of Jacksonville, 405 U.S. 156, 165 (1972)).
7 While most analyses on vagueness reference statutes, the same analysis has
been applied to administrative regulations. See, e.g., Fisher v. Iowa Bd. of
Optometry Exam’rs, 510 N.W.2d 873, 873 (Iowa 1994) (applying same analysis to
“statutory and administrative rule language”); Eaves v. Bd. of Med. Exam’rs, 467
N.W.2d 234, 236 (Iowa 1991) (same); Butt v. Iowa Bd. of Med., No. 12-1118, 2013
WL 2637283, at *15 (Iowa Ct. App. June 12, 2013) (applying statutory vagueness
framework to administrative rule).
13
With this tough row to hoe, Empower begins its vagueness challenge by
quoting the factors in rule 675-20.12(1) that the Board “may” consider in
determining whether a compounded preparation is essentially a copy of an
approved drug and then arguing, “there remains considerable vagueness about
not only what is prohibited by [the] [r]ule, but equally under what conditions the
exemptions are satisfied.” But Empower does not expound on how the rule is
vague in relation to these claims. And the pharmacy’s own documentation
classified its compounded preparations of HCG as essentially copies of the
approved drug showing, as the Board argues, that Empower “was perfectly
capable of determining whether its compounded products were essentially
copies”—an issue that is not meaningfully disputed on appeal.
Empower next argues the rule is vague because the first part of rule 675-
20.12(2), governing “clinically significant difference,” “could be read to require a
detailed explanation, of unlimited length, expressly contained in the prescription
itself.” That subrule is not so complicated, requiring only that the “prescription for
a compounded preparation that is essentially a copy of an approved drug shall
clearly indicate the relevant change and the significant clinical difference produced
for the patient.” Iowa Admin. Code r. 675-20.12(2). Though Empower argues
these requirements are ambiguous, the examples given in the FDA guidance for
compliance with the comparable federal requirements show they can easily be met
with simple notations on the prescription like, “‘No Dye X, patient allergy’ (if the
comparable drug contains the dye)” or “[l]iquid form, patient can’t swallow tablet’
(if the comparable drug is a tablet).” And the subrule goes on to detail what is not
sufficient documentation: “A prescription that identifies only a patient name and
14
compounded preparation formulation is insufficient documentation for a
pharmacy . . . to rely upon to conclude that the prescriber made a determination
regarding a clinically significant difference.” Id.Empower has not explained how these requirements are so inexact that
they “clearly, palpably and without doubt” infringe the constitution. Sloman, 440
N.W.2d at 612 (citation omitted). Instead, the pharmacy suggests it was in
“substantial compliance” with rule 675-20.12(2) because it secured more than just
a patient name and compounded preparation formulation from its prescribing
providers, pointing to the blanket certification on some of the prescriptions “that the
preparation will produce a clinically significant therapeutic response” “due to the
medical need of a specific patient.” But Empower’s claimed “substantial
compliance” with the rule has no bearing on whether the statute is vague. Cf. Dix
v. Casey’s Gen. Stores, Inc., 961 N.W.2d 671, 682 (Iowa 2021) (discussing
substantial compliance in determining whether a statute has been violated). Even
if it did, only a few of the prescriptions for Empower’s compounded preparations of
HCG contained that general certification. The rest had nothing beyond the
patient’s name and compounded preparation formulation, which Empower
acknowledges is insufficient documentation under the rule.
As a result, rule 675-20.12 cannot be considered vague as applied to
Empower, meaning that Empower lacks standing to lodge a facial challenge since
the rule is constitutional as applied to it.8 See Garren, 620 N.W.2d at 285. For
these reasons, we reject Empower’s vagueness challenge.
8There are exceptions to this standing rule, but like the appellant in In re Detention
of Garren, Empower does not address how it falls within one of those exceptions.
15
B. Due Process
Next, Empower claims “the district court erred in finding due process
mandates were met in the [administrative] proceeding.” See Aluminum Co. of Am.
v. Musal, 622 N.W.2d 476, 479 (Iowa 2001) (“[P]arties to administrative agency
proceedings are entitled to due process of law.”). The pharmacy argues the
charging document did not provide it with sufficient notice of the pending charge
or an opportunity to prepare a defense because the document “cited one lone
alleged violation of the [rule], yet [the Board’s] submitted evidence included scores
of prescriptions.” Empower contends it is still unaware which of the prescription
documents violated the rule. Setting aside the error-preservation concerns raised
by the Board, see State v. Taylor, 596 N.W.2d 55, 56 (Iowa 1999), we conclude
Empower’s due-process challenge fails on its merits.
A contested case is initiated by a notice that includes (1) the time, place,
and nature of the hearing; (2) a statement of legal authority and jurisdiction; (3) a
reference to rules involved; and (4) “[a] short and plain statement of the matters
asserted.” Iowa Code § 17A.12(2). “[T]he initial notice may be limited to a
statement of the issues involved”; a statement of matters in detail is not required,
and the adverse party is only entitled to a more definite and detailed statement
upon application. Id. § 17A.12(2)(d). As to the detail required, Iowa Administrative
Code rule 657-35.7 only mandates that the statement of charges “be in sufficient
detail to enable the preparation of the respondent’s defense.”
See 620 N.W.2d 275, 285 (Iowa 2000). So we apply the general rule and hold
Empower lacks standing to make a facial attack. See id.16
The charging document—which came after the conclusion of Mears’s
investigation and her notification to Empower of her findings—met these
requirements by setting out the specific drug, compounded preparations,
applicable rule, and timeframe of the alleged violations, which were entirely based
on documents provided to the Board by Empower. We accordingly agree with the
district court that Empower was provided with notice and an opportunity to defend,
which is all that is constitutionally required. See Musal, 622 N.W.2d at 479 (“The
two fundamental principles of due process are (1) notice and (2) the opportunity to
defend.”). To the extent Empower implies it was on notice of just one potential
prescription being in play because only one count was charged, the charging
document was clear that multiple formulations of HCG prescriptions in two different
calendar years were at issue. We accordingly affirm the court’s conclusion that
Empower was afforded due process.
C. Sufficiency of Evidence
This brings us to Empower’s claim that the district court erred in concluding
the Board’s decision is supported by substantial evidence. See Iowa Code
§ 17A.19(10)(f) (allowing relief on judicial review when agency action is “[b]ased
upon a determination of fact clearly vested by a provision of law in the discretion
of the agency that is not supported by substantial evidence in the record before
the court when that record is viewed as a whole”). But while the issue heading is
captioned as a substantial-evidence challenge, Empower mainly complains that
the Board provided insufficient reasons for its conclusions. See id. § 17A.16(1)
(“Each conclusion of law shall be supported by cited authority or by a reasoned
opinion.”). Specifically, the pharmacy argues the Board, and district court by
17
extension, did not identify “what compounded prescription (patient, prescription,
and prescribing provider) violated the [r]ule.”
“The requirement that the [Board] explain [its] decision is not intended to be
onerous . . . .” Schutjer v. Algona Manor Care Ctr., 780 N.W.2d 549, 560 (Iowa
2010). There need only be enough detail to show the path the agency has taken
through the evidence, and “the law does not require the [Board] to discuss each
and every fact in the record and explain why or why not [it] has rejected it. Such a
requirement would be unnecessary and burdensome.” Id. (citation omitted). An
agency’s “duty to furnish a reasoned opinion [is] satisfied if it is possible to work
backward . . . and to deduce what must have been the agency’s legal conclusions.”
Bridgestone/Firestone v. Accordino, 561 N.W.2d 60, 62 (Iowa 1997) (cleaned up).
Factually, the Board found that Empower dispensed essential copies to
twenty-two Iowa patients between the effective date of rule 675-20.12 and the end
of 2017, and Empower continued to dispense slightly modified essential copies to
sixteen of those patients in 2018. As to its conclusions of law, the Board
determined (1) the compounded HCG preparations Empower sent to Iowa patients
were essential copies; (2) Empower did not meet the exemption for a clinically
significant difference; and (3) even if it had, it did not meet the documentation
requirements of the rule. Based on these conclusions, the Board found Empower
violated the rule.
In making these findings of fact and conclusions of law, the Board had
before it exhibits C through G of Mears’s investigative report, which the district
court relied on in concluding the Board’s decision is supported by substantial
evidence. All of those exhibits, along with other evidence, were relevant to and
18
supportive of the Board’s first conclusion, that Empower’s HCG preparations were
essential copies. Exhibits E through G show Empower dispensed twenty
prescriptions among twelve Iowa patients in late 2017 and throughout 2018, half
of which included a clinically significant difference notification the Board found to
be insufficient to meet the rule, and the other half of which included no notification
at all. These exhibits were key to the Board’s second and third conclusions on
whether the exemption applied and whether Empower met the documentation
requirements.
Working backward and applying our powers of deduction, it is not hard to
surmise that the Board found Empower violated the rule in relation to the twenty
prescription documents for HCG that the Board had before it. That is because the
Board could not have reached its conclusions on clinically significant difference
and documentation deficiencies without those exhibits. While Empower complains
the Board did not pinpoint what specific prescriptions were violations, it points to
nothing requiring the Board to do so. The State charged only one count of a
violation, and the Board found the State met its burden to prove one count. In our
view, the overall conclusion that Empower violated the rule was sufficient and
supported by substantial evidence.
D. Sanction
Finally, Empower claims “the district court erred [in] approving the sanction
levied.” Focusing on the civil penalty of $25,000, the pharmacy identifies lesser
sanctions in other cases decided by the Board “despite much more egregious
conduct” and submits the “severe sanction imposed by the Board in this case is
19
unreasonable, unfair, and not in line with prior precedent established by the
Board.”9
On judicial review, the district court did not find the sanctions imposed in
other cases to be instructive and chose to defer to, rather than second guess, the
Board’s sanction. We agree with this approach. As our supreme court stated in
another pharmacy case:
We have previously noted the limited scope of judicial review
of sanctions imposed by administrative agencies. When a licensing
board is made up of members of the profession they are licensing,
the court should not second guess the board’s decision as to the
appropriate sanction. The pharmacy board is primarily constituted
of pharmacists, and we see no basis in the record to depart from this
sound rule.
Houck v. Iowa Bd. of Pharmacy Exam’rs, 752 N.W.2d 14, 21 (Iowa 2008) (cleaned
up).
Given the broad authority afforded to a professional licensing board to
impose sanctions against those it licenses, the deference afforded to that decision,
and the evidence before the Board, we cannot say the sanction imposed was
9 We note these other Board cases Empower relies on in making this argument
are not part of the record before us, though they are described by the parties in
their briefs. While we could hunt for the cases on our own, it would be a better
practice for the litigants to provide the district court with copies so that they are
included in the appellate record. See Iowa R. App. P. 6.801 (“Only the original
documents and exhibits filed in the district court case from which the appeal is
taken, the transcript of proceedings, if any, and a certified copy of the related
docket and court calendar entries prepared by the clerk of the district court
constitute the record on appeal.”).
Furthermore, at oral argument, the State explained the only thing that would
be available to us on the matters Empower cites would be the final orders
embodying settlement agreements that are posted on the Board’s website, which
we have confirmed. See State v. Washington, 832 N.W.2d 650, 656 (Iowa 2013)
(denying a request on appeal to take judicial notice of sentencing orders in
misdemeanor cases where the filings did “‘not tell the full story’ behind each
sentence imposed”).
20
unreasonable as “against the manifest weight of the evidence” or “shockingly
unfair.” See Burns v. Bd. of Nursing, 528 N.W.2d 602, 605 (Iowa 1995) (citations
omitted) (discussing cases from other jurisdictions). We accordingly affirm the
decision of the district court.
IV. Conclusion
We affirm the district court’s denial of Empower’s petition for judicial review,
finding the rule is not unconstitutionally vague, Empower was afforded due
process, substantial evidence supports the Board’s decision, and the sanction
imposed was not an unreasonable abuse of discretion.
AFFIRMED.