Skip to main content

Executives from drug distribution companies are set to sit before a congressional committee next month to answer questions regarding their role in the opioid crisis.

The House Energy and Commerce Committee plans to speak at the May 8 open hearing in Washington with officers of drug distributors McKesson Corp. (MCK) - Get McKesson Corporation Report , Cardinal Health Inc. (CAH) - Get Cardinal Health Inc. Report , AmerisourceBergen Corp. (ABC) - Get AmerisourceBergen Corporation Report , Miami-Luken Inc. and H.D. Smith LLC. The former three companies distribute about 85% of the prescription drugs in the U.S.

The companies have said they are cooperating with the committee.

The committee previously asked the companies to provide documents regarding how opioids were distributed in West Virginia, a hotbed of the black-market opioid trade that helped create the hillbilly heroin moniker for opioids. The state has the unfortunate title of having the highest death rate from drug overdoses in the country.

The committee made public letters it sent in February to the companies asking about their efforts to keep the painkillers from hitting the streets. The correspondence focused on how an extraordinary number of prescription pills were distributed to a trio of pharmacies in West Virginia.

According to the committee, McKesson and Cardinal shipped 12.3 million doses to a single outlet, Family Discount Pharmacy in Mount-Gay Shamrock from 2006 to 2014. That city had only 1,179 residents according to the 2010 census.

The committee also said that 21 million doses ended up at a pair of pharmacies in Williamson, a town of 3,185 in 2010. The letter said Miami-Luken was responsible for about half of those doses. From 2007 to 2012, that company sent 20 million doses of opioids into the state.

Scroll to Continue

TheStreet Recommends

By law, the drug distribution companies are required to report orders that appear to be suspicious to the Drug Enforcement Agency. The DEA was grilled last month by the same committee over its failure to effectively track and interdict the flow of opioids into the state. Acting Administrator Robert Patterson, who has been on the job since October, blamed the agency's performance on a system where information had to be input manually, saying the agency's information from 2008-2010 was inefficient.

If the March hearing involving the drug agency is an indication, the drug distributors might want to buckle up for a bumpy ride. Frustrated lawmakers called the DEA's efforts to deal with the opioid crisis an "abject failure" and said the drug agency needed to be turned "upside down."

The committee also complained that the DEA was unwilling to help the lawmakers deal effectively with the deadly drug issue, complaining the agency dragged its feet in making documents available and redacted others to the point that they were not particularly useful.

The DEA has its own brand of frustration over opioids. Last year DEA agents wanted to bring criminal charges against McKesson over allegations of violations of the Controlled Substances Act. The Justice Department declined to prosecute the case, saying the DEA had not built a case with enough evidence. Instead, lawyers for McKesson negotiated a settlement with the DOJ that included a $150 million fine and no admission of wrongdoing.

The drug agency is also taking some lumps in another locale, as District Court Judge Dan Polster in Cleveland has ordered the DEA to make data available that includes suspicious order reports regarding opioid distribution in Alabama, Florida, Illinois, Michigan, Ohio and West Virginia from 2006 to 2014. Polster is organizing at least three federal trials based on the hundreds of lawsuits filed by cities, counties and states against opioid drugmakers and distributors based on recovering costs associated with crimes and addiction in those locations.

The DEA has been reticent about turning over data to the court, much to the chagrin of Polster, who said the agency making the data available is a "reasonable step toward defeating the disease." The judge gave the DEA until April 20 to come across with the information after the agency balked at his original request. Lawyers connected to the case believe the data could reveal a pattern of the drugs being shipped and an increase of overdoses and deaths tied to opioids.

A number of lawyers are pursuing the opioid cases in Cleveland who were part of the famed lawsuits against Big Tobacco back in the 1990s. Though the legal actions never saw the inside of a courtroom, the tobacco companies settled for $246 billion in 1998.

That case was settled four years after tobacco executives famously appeared before Congress denying there were any health risks associated with smoking or that the companies had done anything wrong.