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BUSINESS Wednesday 23 december 2020
Feds sue Walmart over role in opioid crisis

By MICHAEL BALSAMO and The Associated Press, say-
ANNE D'INNOCENZIO ing that the Justice De-
WASHINGTON (AP) — The partment's investigation is
Justice Department sued "tainted by historical ethics
Walmart on Tuesday, ac- violations." It said the "law-
cusing it of fueling the na- suit invents a legal theory
tion's opioid crisis by pres- that unlawfully forces phar-
suring its pharmacies to fill macists to come between
even potentially suspicious patients and their doctors,
prescriptions for the power- and is riddled with factual
ful painkillers. inaccuracies and cherry-
The civil complaint filed picked documents taken
Tuesday points to the role out of context."
Walmart's pharmacies may Walmart noted it always
have played in the crisis by empowered its pharmacists
filling opioid prescriptions to refuse to fill problematic
and by unlawfully distribut- opioids prescriptions, and
ing controlled substances said they refused to fill hun-
to the pharmacies during dreds of thousands of such
the height of the opioid cri- prescriptions. Walmart also
sis. Walmart operates more noted it sent the Drug En-
than 5,000 pharmacies in its forcement Administration
stores around the country. tens of thousands of investi-
The Justice Department People shop at a Walmart Thursday, Feb. 6, 2020, in El Paso, Texas. gative leads, and it blocked
alleges Walmart violated Associated Press thousands of questionable
federal law by selling thou- doctors from having their
sands of prescriptions for the Drug Enforcement Ad- years Walmart reported them to fill a high volume of opioid prescriptions filled at
controlled substances that ministration, but prosecu- virtually no suspicious or- prescriptions as fast as pos- its pharmacies.
its pharmacists "knew were tors charge the company ders at all. In other words, sible, while at the same time AP reported the news of
invalid," said Jeffrey Clark, didn't do that. Walmart's pharmacies or- denying them the authority the lawsuit ahead of the
the acting assistant attor- "Walmart knew that its dis- dered opioids in a way that to categorically refuse to Justice Department's pub-
ney general in charge of tribution centers were using went essentially unmoni- fill prescriptions issued by lic announcement, citing
the Justice Department's an inadequate system for tored and unregulated." prescribers the pharmacists a person who could not
civil division. detecting and reporting The 160-page suit alleges knew were continually issu- discuss the matter publicly
Federal law required suspicious orders," said Ja- that Walmart made it dif- ing invalid invalid prescrip- before the announced
Walmart to spot suspicious son Dunn, the U.S. attorney ficult for its pharmacists tions. move. The person spoke
orders for controlled sub- in Colorado. "As a result of to follow the rules, putting Walmart fought back in to the AP on condition of
stances and report those to this inadequate system, for "enormous pressure" on an emailed statement to anonymity.q

Peloton ... if you build it, they will come

By MICHELLE CHAPMAN At the opening bell Tues- product development,
With no sign that home day, shares of Peloton In- and quality assurance ca-
workouts will fade out any teractive Inc. spiked 12% to pabilities in Whitsett, North
time soon, Peloton cranked an all-time high. Carolina and Woodinville,
up its manufacturing ca- The ability to churn out its Washington.
pacity in a big way this bikes as demand exploded Peloton can control the
week and it picked up a this year has been a chal- entire production process
bunch of new fans on Wall lenge for the New York from design to shipping
Street. City company. The phrase and increase total produc-
The maker of high-end sta- "manufacturing capacity" tion scale, while being bet-
tionary bikes and accom- came up no less that eight ter able to maintain a high
panying monthly subscrip- times during its earnings level of product quality.
tions said late Monday that conference call last month. The deal also comes with
it will spend $420 million to After reporting that sales 100-person research and
acquire Precor, a compa- surged more than 230% in development team from
ny whose fitness machines its first quarter, shares tum- Precor. This Nov. 19, 2019, photo shows a Peloton logo on the compa-
populate hundreds of com- bled more than 25% after Bringing manufacturing to ny's stationary bicycle in San Francisco.
mercial and hotel gyms. the company warned in the U.S. will also allow Pelo- Associated Press
The acquisition, Peloton's that call that it would face ton to better speed bikes to
biggest to date, gives the supply constraints "for the anyone who orders one at VID-19," wrote JP Morgan house closures related to
company its first manufac- foreseeable future." some point in 2021, when analyst Doug Anmuth. "Bike COVID-19, & both West
turing capacity in the U.S., The Precor deal will go a the Precor's manufacturing wait times have remained Coast fires & hurricanes."
its biggest market, during long way toward address- capacity is rolled into Pelo- elevated for months, as It has been a rollicking
a global pandemic that ing those constraints. ton's. (Peloton) faced a perfect stretch for Peloton.
has people cancelling gym Precor has 625,000 square "Supply chain execution storm of sorts with much Just one year ago, Peloton
memberships and seeking feet of U.S. manufactur- has remained Peloton's big- higher-than-expected de- a released Christmas ad
ways to stay fit in the safety ing capacity with in-house gest challenge since de- mand for the new Bike+, panned by critics as "sexist,"
of their own homes. tooling and fabrication, mand surged during CO- port congestion, ware- "dystopian" and "elitist." q