Essential to the formation of benzophenanthridine alkaloids in the response of plants to pathogenic attack. Catalyzes the stereospecific conversion of the N-methyl moiety of (S)-reticuline into the berberine bridge carbon of (S)-scoulerine. Involved in the biosynthesis of sanguinarine. (S)-reticuline + O2 = (S)-scoulerine + H(+) + H2O2 Binds 1 FAD per subunit in a bicovalent manner. Alkaloid biosynthesis; (S)-scoulerine biosynthesis; (S)-scoulerine from (S)-reticuline: step 1/1. Expressed in roots and stems. Not detected in leaves or reproductive organs. Transiently induced 3 days after seed imbibition. Up-regulated upon fungal elicitor treatment and by methyl jasmonate. The FAD cofactor is bound via a bicovalent 6-S-cysteinyl, 8alpha-N1-histidyl FAD linkage. Belongs to the oxygen-dependent FAD-linked oxidoreductase family.