A Drug Enforcement Administration agent in October 2005 requested documents about drug distributor McKesson’s sale of opioids to an internet pharmacy in East Baltimore.

In a March 2009 email to colleagues, a McKesson official noted that a Dundalk pharmacy owner was hiring guards to prevent the sale of prescription opioid pills in his parking lot.

An opioid manufacturer in November 2012 warned McKesson about its concerns over that a different East Baltimore pharmacy’s dispensing of opioids.

All of these instances at the height of the opioid epidemic should have served as serious “red flags” that the opioids McKesson was distributing were ending up in the wrong hands, a former DEA investigator testified in Baltimore Circuit Court Tuesday, yet the company in each case continued sending huge quantities of opioids to the pharmacies for months or years.

“In my opinion, they did not respond to the red flags in a timely manner or in an adequate manner. I don’t believe they did an adequate job preventing diversion,” Ruth Carter told jurors, referring to the phenomenon of legal drugs being distributed illegally.

Carter took the witness stand Monday and Tuesday as the first expert to testify in support of Baltimore’s civil trial against McKesson and fellow drug distributor AmerisourceBergen, which the city alleges flooded the city with hundreds of millions of pain pills from 2006 to 2019 while intentionally overlooking the havoc the opioids would wreak.

The influx of prescription opioids, city lawyers contend, created a new generation of people suffering from addiction who would go on to die at unprecedented rates when their scripts ran out and they turned to an illicit drug market inundated with deadly fentanyl, a synthetic opioid up to 50 times more potent than heroin.

In its 2018 lawsuit, the city claimed that the actions of opioid manufacturers, distributors and pharmacies created a public nuisance that deprived Baltimore residents of their rights to health and safety. Several drug manufacturers and pharmacy chains already have settled with the city to the tune of at least $402.5 million.

Carter’s testimony followed that of officials from Baltimore’s public works, fire and health departments, underscoring the toll of the opioid epidemic on city resources.

Lawyers for McKesson and AmerisourceBergen say cartels, gangs and street crews are to blame for the opioid crisis because they brought heroin and fentanyl to Baltimore and peddled it on street corners here. They argue that their companies merely supply opioids to licensed pharmacies based on the demand created by doctors’ prescribing practices.

After a DEA agent in October 2005 signaled to McKesson that the federal agency would subpoena its sales records related to New Care pharmacy in East Baltimore, McKesson reduced the supply of hydrocodone pills it sent to the pharmacy temporarily, then ramped sales back up. Within six months, it was sending 2,000 pills per night to the pharmacy, Carter testified.

Carter said she reviewed thousands of McKesson and AmerisourceBergen documents as part of her analysis of the companies’ roles in Baltimore’s opioid epidemic.

McKesson sent 3 million hydrocodone pills to New Care from January 2005 to October 2006, when the wholesaler cut off business with the pharmacy, according to court documents.

“That’s an egregious amount of hydrocodone to ship to a pharmacy,” said Carter, adding that she believed McKesson neglected its responsibility to monitor New Care for suspicious orders of opioids and report such orders to the DEA, a legal obligation under the federal Controlled Substances Act.

“There is no due diligence, in my opinion,” Carter said of McKesson’s oversight of New Care. “They had glaring red flags in this instance.”

New Care’s owners were convicted in federal court and sentenced in 2009 to five years in prison each for illegally selling hydrocodone. The U.S. Department of Justice took legal action against McKesson because of what it did at New Care, entering into a settlement with the company on May 2, 2008.

In addition to paying approximately $13.3 million, the agreement required McKesson to attest that it would create a program to comply with the Controlled Substances Act and report suspicious drug orders to the DEA. McKesson did not report a suspicious order in the Baltimore area from the time of the settlement until March 2012 — almost four years later.

On March 12, 2009, a McKesson official told colleagues in an email that the owner of Drug City pharmacy in Dundalk was hiring “off duty police officers to do surveillance on his store with the goal of catching individuals who may be receiving scripts and then selling them outside the store to third party individuals.”

A McKesson regulatory official wouldn’t visit the pharmacy again for almost two years, Carter testified. Meanwhile, its sale of oxycodone at Drug City skyrocketed to 3 million pills a year.

“This was the pharmacy,” Carter said, “that purchased the most oxycodone, the documents show, of anywhere in the country.”

Other McKesson documents showed that Drug City filled prescriptions from doctors around Baltimore and Baltimore County, and as far away as Delaware and North Carolina, according to Carter’s analysis. The doctors that it filled scripts for most was a Baltimore County “pill mill” practice whose owners were later convicted in federal court.

Nonetheless, a McKesson sales representative continued to request on Drug City’s behalf an increase to its monthly supply, writing each time as a justification that, “customer business is increasing at a very high rate.” At the peak, McKesson was sending 273,000 oxycodone pills to the pharmacy each month.

“They were just giving them as much oxycodone as they wanted. They definitely weren’t doing their due diligence,” Carter testified.

McKesson reduced sales to Drug City, and eventually ended its business there, only after a DEA agent contacted them and that agency raided the pharmacy.

In November 2012, opioid manufacturer Mallinckrodt Pharmaceuticals warned McKesson that it was considering denying the wholesaler reimbursement for purchasing its brand of pills and selling them to Bayview Pharmacy in East Baltimore. Oxycodone alone accounted for 38% of McKesson’s overall drug sales to the pharmacy and a McKesson regulator wrote that “they seem to fill a large amount of prescriptions for pain clinics,” according to documents displayed in court.

“That’s a big red flag and it should’ve been investigated immediately,” said Carter, noting that McKesson didn’t end its relationship with Bayview for more than nine months after the manufacturer’s warning.

Carter is expected to continue testifying Wednesday and could remain on the witness stand for several more days.