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    Published on: December 23, 2020

    Today's edition, the last MNB of 2020, features KC and Michael Sansolo in an extended  conversation about retailing lessons learned in during this most extraordinary year - the highlights and missed opportunities, the changes that are ephemeral and the ones that will be long-lasting, and where the focus needs to be going forward.

    And, KC and Michael being who they are, there's also a more whimsical element to the chat, as they talk about weird metrics that have marked the passing of time … the elements of their old lives that are missed … the things that kept them sane and made them crazy … and favorite movies and TV shows of the past 10 months.

    If you've got the time, sit back with a cup of coffee or an adult libation … or watch the conversation in pieces … and mark with KC and Michael the end of one year and the beginning of another.

    A note from the Content Guy:  When Michael and I recorded this conversation, I planned it to be the only story this morning.  But, as John Lennon once said, life is what happens when you are making other plans.  There were two stories that cropped up on Tuesday that I wanted to bring to your attention…

    Published on: December 23, 2020

    The US Department of Justice yesterday filed a lawsuit yesterday that accuses Walmart of having illegally dispensed controlled substances - specifically opioids - and in doing so helped to worsen the nation's opioid crisis.

    "As one of the largest pharmacy chains and wholesale drug distributors in the country, Walmart had the responsibility and the means to help prevent the diversion of prescription opioids," Jeffrey Bossert Clark, acting assistant attorney general of the Civil Division, said in a statement.  "Instead, for years, it did the opposite — filling thousands of invalid prescriptions at its pharmacies and failing to report suspicious orders of opioids and other drugs placed by those pharmacies … This unlawful conduct contributed to the epidemic of opioid abuse throughout the United States. Today's filing represents an important step in the effort to hold Walmart accountable for such conduct."

    Penalties, according to National Public Radio, could be in the billions of dollars.

    According the NPR story, "At its pharmacies, Walmart is alleged to have knowingly filled thousands of controlled substance prescriptions that were not issued for legitimate medical purposes. And at its distribution centers, the government says Walmart received hundreds of thousands of suspicious orders that it failed to report to the Drug Enforcement Administration, as required."

    The Wall Street Journal provides this context:

    "Walmart started with cut-rate prices on opioids that initially drove shoppers to its stores, the government alleges. Middle managers—under direction from executives at company headquarters—pressured pharmacists to work faster, the suit says, believing quick-fill prescriptions drew customers to stay and keep shopping.

    "Many of the alleged problems centered in Walmart’s compliance unit, which oversaw dispensing nationwide from the company’s main office in Bentonville, Ark., the suit says. Walmart allegedly ignored repeated warnings that the company had understaffed its pharmacies as pressure to sell quickly caused mistakes and put patients’ health at risk, according to the complaint.

    "Pharmacists allegedly got little help from compliance managers who for years didn’t share information between stores, and in many cases refused requests to give blanket rejections to suspect prescribers even after rival retailers had done so, the suit says."

    The Washington Post offers some big-picture perspective:

    "The lawsuit comes after lawsuits filed last summer by cities, towns, counties and Native American tribes across the country alleging that retailers such as Walmart, CVS, Rite Aid and Walgreens played a role in driving the opioid epidemic by distributing billions of pills. A number of those federal trials, in states including Ohio, West Virginia and Texas, have been delayed during the pandemic.

    "Last month, Purdue Pharma, the maker of OxyContin, pleaded guilty to three felonies and agreed to an $8.3 billion settlement with the Justice Department for its role in a crisis that has killed more than 400,000 Americans in the past two decades.

    "Roughly 50,000 Americans died of opioid overdoses last year, a record, federal data shows, and medical experts have warned that the coronavirus pandemic and economic crisis have led to new surges in opioid deaths."

    The New York Times notes that "Walmart pre-emptively denied the charges in October in a suit against the Trump administration, saying the company was being used as a scapegoat and blaming the opioid crisis on what it called the federal government’s own weak enforcement … On Tuesday, Walmart made a similar argument, saying the Justice Department was forcing retailers to 'second guess' doctors and 'putting pharmacists and pharmacies between a rock and a hard place with state health regulators who say they are already going too far in refusing to fill opioid prescriptions'."

    KC's View:

    I have to believe that this thing gets settled before it ever reaches a courtroom.  While Walmart may be positioning itself as wanting to have a robust debate about the nature of legal culpability, I tend to think that that the last thing the folks in Bentonville want is for this thing to get into a courtroom, where people's whose loved ones died from opioid abuse - and got at least some of those opioids from a Walmart pharmacy - get on the stand and tell their stories.  Even if Walmart thinks its position is defensible, the optics would be horrible.

    As for the basic issue … if it can be proven that some of Walmart's pharmacists alerted their bosses that way too many opioids seemed to be getting into the system, and the powers that be ignored those warnings because all those opioids were incredibly profitable … well, that sounds like a hard behavior to defend.

    Published on: December 23, 2020

    The Wall Street Journal has a piece that goes inside the Amazon machine, starting with the following observations:

    "Jeff Bezos built Inc. from his garage with an underdog’s ambition to take on the establishment. He imbued staff with an obsession to grow fast by grabbing customers using the biggest selection and lowest prices. Today, he has more than 1.1 million employees and a market valuation around $1.6 trillion.

    "But Amazon never really grew up. Mr. Bezos still runs it with the drive of a startup trying to survive.

    "That ethos helps keep Amazon booming. Aggressive competition - including wresting market share from rivals - is often a hallmark of a successful business. It’s also why the tech-and-retail giant is the target of rivals, regulators and politicians who say its tactics are unfair for a company its size, and potentially illegal … Some rivals and partners say Amazon’s competitive zeal looks like unfair practices."

    You can and should read the piece here.

    KC's View:

    I tend to be a little more forgiving on the issues brought up by the Journal, if only because much of what Amazon does is similar to what many retailers do.  Amazon does it bigger and better because it is bigger and wants to be better.  But that doesn't mean these challenges are going to go away, and Amazon is probably going to lose a few rounds.  But not all the rounds … and the betting here is that Amazon still be standing in the end.

    Published on: December 23, 2020

    As noted above, MNB is done for 2020.  (I'm also done with 2020 … but that's a different conversation.)

    I'm going to take some time off and celebrate the holiday with my immediate family (though our son in Chicago is not traveling home - he decided to do what he felt was the responsible thing and not come home, and as much as we'll miss him, we applaud him for doing the right thing). 

    There also will be books and movies and wine and jogging and long walks with the dogs.  And there will be a soundtrack, perhaps more relevant this year than in the past…

    Through the years we all will be together

    If the fates allow

    Until then, we’ll have to muddle through somehow

    So have yourself a merry little Christmas now.

    To which I can only add … have a wonderful holiday, and safe and happy New Year … stay healthy … and I'll see you on Monday, January 4, 2021 with a fresh supply of news and hand-crafted commentary.