Union Workers Rally Together To Protest Drug Distribution Giant

Union Workers Rally Together To Protest Drug Distribution Giant

By Kelly Burch 07/28/17

The union holds more than $30 million shares in the drug distribution company's stock.

Image: 
a group of union workers at a protest

One of the largest labor unions in the United States, the International Brotherhood of Teamsters, protested at the annual meeting of McKesson Corporation, a drug distribution company that the union accuses of contributing to the opioid epidemic. 

"McKesson has become embroiled in what is perhaps America’s most tragic failure of corporate integrity: the prescription-opioid crisis, which claims the lives of 62 Americans every day,” Ken Hall, general secretary-treasurer for the Teamsters, said in prepared remarks for the meeting, according to Bloomberg. “Independent board leadership is critical going forward in light of the current crisis facing the company.”

McKesson agreed in January to pay a record $150 million fine and stop sales of controlled substances from distribution centers in Colorado, Ohio, Michigan and Florida after the Justice Department claimed that the company did not properly investigate pharmaceutical orders that should have been flagged because of their size and frequency. The company was fined for a similar violation in 2008. 

"For years, McKesson allowed opioids to flood into our communities, and despite the irreparable harm and growing reputational and financial risks, the company has continued to reward [the CEO] with ballooning bonuses and some of the most lucrative pay packages in the country," Hall said in a statement reported by CNN Money.

The union, which includes many workers from areas that have been heavily impacted by opioid addiction, holds more than $30 million in McKesson shares, according to CNN. The union was calling for the board to appoint an independent director as chairman, rather than John Hammergren, who currently works as CEO and chairman. In the dual role, Hammergren has made $692 million in 10 years.

"We can't afford another decade of business as usual at McKesson," Hall said.

The board declined to make that change immediately, but agreed to split the role when Hammergren steps down. The teamsters also called for changes to the way executives are paid, ending incentive pay based on the sale of controlled substances.

Investors at Wednesday’s meeting rejected the company’s executive compensation program. Although the investors’ votes were non-binding, the company said that it will look into reevaluating the program.

“The Compensation Committee will conduct a thorough review of the current executive compensation plan and consider implementing changes that further drive alignment between incentives and shareholder value,” according to a statement made by the company.

In the same statement, the company addressed concerns over its role in the opioid epidemic. 

“The opioid epidemic is a national public health crisis, and McKesson takes its responsibility to help manage the safety and integrity of the pharmaceutical supply chain extremely seriously. While McKesson doesn’t manufacture, prescribe, or dispense opioids, the company is doing everything it can to help address this crisis in close partnership with the U.S. Drug Enforcement Administration (DEA) and other organizations across the supply chain,” the statement read. 

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Kelly Burch writes about addiction and mental health issues, particularly as they affect families. Follow her on TwitterFacebook, and LinkedIn.

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