This article originally appeared at NC Policy Watch.

A financially troubled company stored more than 500 containers of flammable liquids, gases and hazardous pharmaceuticals without a permit, posing an “imminent and substantial endangerment,” according to state regulators.

Pharmaceutical Dimensions, which leased a warehouse at 7353-A W. Friendly Ave. in Greensboro, was cited by the NC Department of Environmental Quality in early March after repeatedly failing to comply with hazardous waste rules for nearly a year. 

Michael P. Deason of Greensboro owns the company, according to state records. 

Pharmaceutical Dimensions is a “reverse distributor.” Health care facilities send these distributors surplus, expired or damaged pharmaceutical products, including drugs in pill and liquid form, chemotherapy agents, vaccines, as well as medical supplies contaminated with drug residue, such as IV tubing. 

In turn, the reverse distributor either ships the materials back to the manufacturer for credit, or sends the waste to a specialized hazardous waste treatment facility. 

Reverse distributors must obtain a waste permit from the NC Department of Environmental Quality. Based on inspections findings, DEQ officials cited Pharmaceutical Dimensions for operating without a permit.

Reverse distributors also must be licensed through the state Agriculture Department’s Food & Drug Division, and are required to renew their license annually. A department spokeswoman told Policy Watch that Deason’s license has expired. 

Tim McQueen, who previously managed the company’s day-to-day operations, told Policy Watch by phone that Deason has closed the business and “released his licenses.” 

“He’s gone a different direction,” McQueen said. “I don’t know what he’s doing now.”

Federal and state hazardous waste law limits the amount of time a reverse distributor can store shipments, usually no more than 180 days. The containers must be inventoried and evaluated within 30 days of arriving at a facility. 

However state inspectors recently found Pharmaceutical Dimensions had accumulated dozens of hazardous waste shipments onsite for more than six months. Approximately 84 boxes of waste were undated, state records show.

Many of the boxes and barrels held flammable materials, including ethanol, sulfur and camphor. Others contained potassium nitrate and sodium nitrate. These are classified as oxidizers. Not inherently flammable, oxidizers can still ignite if exposed to other hot or burning materials.

When state inspectors visited the warehouse in early January, Deason told them that he “had been out of the daily operations of the business” until September 2021, but had since returned, according to the Imminent Notice of Violation. 

During that inspection, Deason told state officials that “shipping the hazardous waste pharmaceuticals offsite was a top priority as soon as funding became available.”

State inspectors requested an inventory from the company five times, including during and after site visits in January and in March of this year. DEQ spokeswoman Laura Leonard said the company has yet to provide an inventory.

A partial list of hazardous pharmaceutical waste stored without a permit at the Pharmaceutical Dimensions warehouse. (Source of list: NCDEQ)

The company’s warehouse is tucked in the back of an industrial park just south of Piedmont Triad Airport. Although it is largely an industrial and commercial area, the nearest home is a quarter-mile away and three apartment complexes are about a half-mile east. Nearly 2,000 people live in the census block group, nearly two-thirds of them people of color, according to the state’s community mapping system.

Pharmaceutical Dimensions incorporated in 2006, according to North Carolina Secretary of State filings. Over the past 15 years, the company has moved several times to different warehouses in Greensboro.

Until last year the company’s environmental compliance history had been unremarkable, if incomplete. It initially registered with DEQ as a “very small quantity generator.” In November 2017, DEQ inspectors arrived at the company’s previous location on Greenpoint Drive, but learned that it had moved. Seven months later, in June 2018, DEQ inspected the facility at its new location on Tudor Drive, and found no violations.

But what occurred between mid-2018 and early 2020 is unclear. The company did not register with the state during that time, so DEQ didn’t inspect the facility.

However, public records show that over those two years, that the company encountered financial problems. Court records show that the IRS had twice issued a lien on Pharmaceutical Dimensions over unpaid taxes.  The latest, totaling $126,281, was levied in 2019; it has not been paid, according to court records. The company and a related enterprise, Vittoria Ventures, were also sued in 2018 by Rock Bottom Bottles, a wholesaler of glass and plastic jars. (Pharmaceutical Dimensions paid off its 2012 lien, worth $80,972.)

Pharmaceutical Dimensions stored more than 500 containers of hazardous pharmaceutical waste in this warehouse. (Photo: Lisa Sorg)

Pharmaceutical Dimensions re-emerged in 2021 and registered as a “large quantity generator.” A DEQ inspection in June of that year found many violations, including missing paperwork and written emergency plans, which company officials attributed to “a transition time for the company and the COVID-19 pandemic.”

McQueen, Pharmaceutical Dimensions’s former operations manager, attributed the company’s troubles to new federal hazardous waste regulations. “Thousands of pharmacies have no clue,” said McQueen, who has worked in the waste business for 30 years. “We have no control over what companies are sending us. [DEQ] is beating us up over an EpiPen.”

The new federal rules, which became effective in 2019, are complex. However, there is more than a single EpiPen at stake.

For decades, a standard practice at many health care facilities was to flush unused pharmaceuticals down the toilet or drain. Mood stabilizers, hormones, chemotherapy agents — had been found in waterways across the U.S. These compounds can harm aquatic life and enter drinking water supplies.

Chemotherapy drugs, for instance, are very toxic and can be corrosive; other medications can contain arsenic or mercury. The presence of antibiotics can spur the growth of antibiotic-resistant bacteria. 

Even medicines that aren’t found in waterways can pose hazards. Bronchial dilators, for instance, are ignitable. 

The EPA strengthened its hazardous pharmaceutical waste rules in 2019; North Carolina adopted the federal provisions. The changes were prompted in part because of an EPA Inspector General’s report critical of the agency’s inaction on hazardous waste pharmaceuticals. That report, issued in 2012, noted that the EPA had not updated its regulations about pharmaceutical hazardous waste in 30 years.

More than 100 drugs had been identified as hazardous by other federal agencies, such as OSHA, that had not been reviewed by the EPA.

“Hazardous waste regulations are not keeping up with drug development,” the Inspector General wrote, “and the potential hazards they may pose if mismanaged and disposed without the necessary protections to human health and the environment.”

(Many law enforcement agencies have installed drop boxes for the public to deposit old or unused medicines. Milford Harris of the Greensboro Police Department told Policy Watch that it incinerates these products, and does not ship them back to the manufacturer or use a reverse distributor.)

For its many violations — operating without a permit, failing to evaluate and inventory its hazardous waste — Pharmaceutical Dimensions faces penalties of up to $32,500 per day. DEQ spokeswoman Laura Leonard said the agency is weighing “next steps.”

McQueen still operates out of the same warehouse but has restarted a different business, Ozone Waste Solutions. A medical waste treatment and processing company, it was a subsidiary of Pharmaceutical Dimensions. McQueen was the chief operating officer of Ozone Waste Solutions, but it closed in 2020, state records show.

McQueen said that only non-hazardous materials remain in the warehouse on West Friendly Avenue. “We’re working to get it out the door,” he said.

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