Most guides to DEA inspections tell you to keep good records. This one describes the visit itself: who walks in, what they hand you, what you sign, which records they ask for and in what order, how the count is done, and what the conversation at the end sounds like. If you know the sequence, the day is far less stressful, and you will notice the places where your own records would not hold up.

A routine inspection and an investigation prompted by a complaint, a Form 106 pattern or a wholesaler report start with the same paperwork. The difference is in how targeted the record requests are. The sequence below applies to both.

Step 1: Credentials, the Form 82, and your consent

Administrative inspections are authorized by section 510 of the Controlled Substances Act (21 U.S.C. 880), and the procedure is in 21 CFR Part 1316. The regulation says an inspector may enter after stating the purpose of the visit, presenting credentials and a written notice of inspection authority, and obtaining either informed consent or an administrative inspection warrant (21 CFR 1316.05).

The written notice is DEA Form 82, the Notice of Inspection. By rule it names the owner, operator or agent in charge, the premises and address, the date and time, a statement that the notice is given under section 510, a reproduction of the relevant parts of that section, and the inspector's signature (21 CFR 1316.06). Read it. The name on it is the person DEA regards as the one giving consent.

Consent is the part most people are unprepared for. The regulation asks for a written, signed statement, witnessed by two people, in which the person in charge acknowledges six things: that they have been told of the constitutional right not to be inspected without an administrative warrant; that they may refuse; that anything incriminating may be seized and used in a criminal prosecution; that they have received the Form 82; that consent is voluntary; and that consent may be withdrawn at any time during the inspection (21 CFR 1316.08(b)). You receive a duplicate of what you sign.

If consent is refused, the inspector can apply for an administrative inspection warrant. The statute lets a federal or state judge or magistrate issue one on a showing of “probable cause”, defined for this purpose as a valid public interest in enforcing the Act, and the warrant must be executed within ten days (21 U.S.C. 880(d)). A warrant is also not needed for an initial-registration inspection or where records are demanded by administrative subpoena (21 CFR 1316.07). In practice, deciding in advance who the “agent in charge” is, and whether you want counsel contacted before signing, is more useful than deciding whether to refuse.

Step 2: What they may look at, and what they may not

The regulation lists the purposes of an inspection: inspecting and copying required records, including the inventory and continuing records under Part 1304, order form records under Part 1305 and prescription records under Part 1306; inspecting equipment, finished and unfinished controlled substances, containers and labeling; making a physical inventory of all controlled substances on hand; collecting samples, for which a receipt on DEA Form 400 must be issued; and checking records of distribution, including whether distribution has “increased markedly within the past year, and if so why” (21 CFR 1316.03).

Three categories are off limits unless the person in charge consents in writing: financial data, sales data other than shipping data, and pricing data (21 CFR 1316.04; 21 U.S.C. 880(b)(4)). Invoices showing what was received and when are shipping data and are fair game.

Step 3: The record requests, in the order to have them ready

The inspection is a records exercise before it is a counting exercise. Expect requests close to this order, and expect each one to be checked against the next.

  1. The registration certificate for this location, and confirmation of the schedules it covers.
  2. The most recent biennial inventory, and the one before it if the gap is near two years. It must state whether it was taken at opening or close of business, be kept at the registered location, and record an exact count for Schedule II substances in opened containers; Schedules III through V may be estimated unless the container holds more than 1,000 dosage units (21 CFR 1304.11(a), (c) and (e)(6)).
  3. Schedule II order records. For paper orders, the purchaser's copy of each Form 222 with the number of containers received and the date of receipt written on it (21 CFR 1305.13(e)). For electronic orders, the linked record of quantity and date received (21 CFR 1305.22(g)). Form 222 records must be kept separately from everything else and available for two years (21 CFR 1305.17(c)).
  4. Powers of attorney for everyone who has signed an order, kept with the order records for as long as any order they signed is kept (21 CFR 1305.05(a)). An order signed by someone with no power of attorney on file is a finding on its own.
  5. Receiving records for Schedules III through V: invoices or packing slips showing the date, the supplier and the quantity (21 CFR 1304.22(c), by reference to the manufacturer requirements in 1304.22(a)(2)(iv)).
  6. Dispensing records: the name and address of the person dispensed to, the date, the quantity and the written or typed name or initials of the person who dispensed or administered the substance (21 CFR 1304.22(c)). For a pharmacy, paper Schedule II prescriptions must be in their own file (21 CFR 1304.04(h)(2)).
  7. Destruction records on DEA Form 41, signed by the two employees who witnessed the destruction (21 CFR 1304.21(e)), and reverse distributor manifests for anything sent out for destruction.
  8. Theft and loss history: every Form 106 filed, and the written one-business-day notice that should have preceded each (21 CFR 1301.76(b)). If the inspector already knows about a loss you did not report, that is usually how the visit was triggered.

The thread running through these is that each record has to be producible in a reasonable time, which is what “readily retrievable” means in the regulations: records that an electronic system can separate out from all other records, or paper records visually marked so the controlled items stand out (21 CFR 1300.01). A record that exists somewhere in a warehouse box is not readily retrievable.

Step 4: The accountability audit

The physical count is not a free-standing count. It is the closing balance of an accountability audit, a reconstruction that DEA investigators have used for decades. The method is not spelled out in the regulations; the authority for it is the power to verify the correctness of your records and to take a physical inventory (21 CFR 1316.03(a) and (c)).

For a handful of drugs, typically the opioids, benzodiazepines and stimulants that move the most, the investigator builds a simple equation:

  • Opening balance: the quantity on your last inventory, or an earlier count the investigator chooses as the starting point.
  • Plus receipts: every Form 222, CSOS order and invoice for that product since that date.
  • Minus dispositions: every dispensing record, transfer, return, destruction and reported loss.
  • Equals the computed balance, which is compared with what is on the shelf today.

A shortage means more left than your records show leaving. An overage means less left than your records show, which can mean receipts were never posted or dispensing was recorded for product that stayed on the shelf. Both are findings. Both are explained by records, not by recollection. This is also why the inspector counts your stock rather than taking your perpetual balance: the perpetual is one of the records under test.

If you want to know what the audit will find, run it yourself first. The drug diversion audit guide covers how to pick the drugs and the window, and the recordkeeping checklist lists each record the reconstruction depends on.

Step 5: The questions about how the place runs

Between record requests the investigator will ask operational questions, and the answers are measured against the security standards in 21 CFR 1301.71 through 1301.76. Among the factors DEA may weigh in deciding whether controls are adequate are key and combination lock control, supervision over employees with access to storage areas, procedures for visitors and maintenance staff, and the adequacy of the system for monitoring receipt and disposition of controlled substances (21 CFR 1301.71(b)). Expect to be asked who holds keys or codes, how access is removed when someone leaves, who is allowed in the vault alone, how discrepancies are resolved and by whom, and whether you employ anyone with access who has a felony controlled substance conviction or a surrendered registration, which the rule forbids (21 CFR 1301.76(a)).

Answer from policy, not from memory, and have the policy on hand. The guide to “effective controls” goes through each factor in a pharmacy setting.

Step 6: The close-out

At the end, the investigator will usually walk through what was found. Treat this as information gathering, not negotiation. Note each item, ask what record or correction would address it, and do not volunteer theories about who is responsible for a shortage. What follows depends on what was found and ranges from nothing at all, to a letter describing deficiencies, to a negotiated agreement with corrective actions, to civil penalty proceedings or formal action against the registration. The facts that drive that judgment are the ones in your records.

Before the next visit: name the “agent in charge” for each site and a backup, run the accountability audit yourself on your highest-volume Schedule II products, and match every power of attorney, Form 222 copy, Form 41 and Form 106 to the record that should sit beside it.

Frequently asked questions

Can we ask the inspector to come back later?
Consent is voluntary and can be refused or withdrawn (21 CFR 1316.08(b)). Refusal does not end the matter; the inspector can seek an administrative warrant (21 CFR 1316.07; 21 U.S.C. 880(d)). A short delay to reach the person in charge or counsel is a reasonable request. A refusal is a decision for the registrant and counsel, not for whoever is at the counter.

Can they take our original records?
The inspection authority is to inspect and copy records (21 CFR 1316.03(a)). Samples of controlled substances may be collected, and a receipt on DEA Form 400 must be issued (21 CFR 1316.03(d)). Seizure of property under a warrant is a separate matter with its own receipt and inventory requirements (21 U.S.C. 880(d)(3)).

How often are pharmacies inspected?
The regulation states an intent to inspect certain manufacturers and distributors annually and other non-practitioner registrants “as circumstances may require”, based partly on compliance history and effective controls (21 CFR 1316.13). It sets no interval for pharmacies or hospitals.

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