By Alan Murray and Geoffrey Smith
October 18, 2017

Good morning.

I was in Washington Sunday, and started my day reading The Washington Posts story on how the drug industry won passage of a law in 2016 that weakened the DEA’s ability to stop excessive opioid shipments. It’s an impressive piece of reporting—if a little perplexing, for reasons I’ll get to.

It was followed Sunday night by a coordinated takedown on 60 Minutes, where ex-DEA agent turned whistleblower, Joe Rannazzisi, said the big three drug distribution companies—McKesson, AmerisourceBergen, and Cardinal Health (numbers 5, 11 and 15 on the Fortune 500 list)—were “out of control.” That led President Trump yesterday to scotch his nominee to be drug czar, Rep. Tom Marino, who had championed the legislation. No doubt there was cheering in the Post newsroom. This one is headed for the Pulitzer committee.

Back to the perplexing part: I had lots of questions as I was reading Sunday morning. For instance, why didn’t a single member of Congress oppose the legislation? Or for that matter, why didn’t the DEA or the Obama administration oppose it? Why was Rannazzisi unable to get anyone to take his side? And for that matter, where’s the evidence that DEA enforcement was having any significant effect prior to the change?

The National Review apparently had similar concerns, and dissects them here. And Sen. Orrin Hatch, who was involved in passage of the bill, went on the attack. “Did the entire U.S. Congress decide to shield its eyes to the true sinister intent of this legislation?” he asked rhetorically. “Let’s not pretend that DEA, both Houses of Congress, and the Obama White House all somehow wilted under Rep. Marino’s nefarious influences.”

But here’s the thing: the big three drug distributors do need to take responsibility for clearly abusive shipments of opioids, as Fortune’s Erika Fry demonstrated in this piece on McKesson earlier this year. The Charleston Gazette-Mail won its own Pulitzer this year for an investigation that showed between 2007 and 2012, an eye-popping 750 million pain pills were shipped to the state of West Virginia alone—or 433 pills for every man, woman and child in the state. More than half of those came from the big three. In the age of big data analytics, why do we have to wait for a newspaper investigation—or DEA action—to alert us that something is amiss? Shouldn’t the drug distributors have done more to both spot and police the problem? You bet.

News below.

Alan Murray


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