Two shipping companies, FedEx (NYSE:FDX) and UPS (NYSE:UPS), are under investigation by the U.S. Drug Enforcement Agency related to the shipping of illegal prescription painkillers.
The issue centers on whether the two delivery firms are complicit with certain illegal online pharmacies in delivering opioids, such as oxycodone and hydrocodone. The DEA, as part of an investigation that goes back as far as 2005, believes employees at both firms were aware of the shipments but did nothing to prevent them.
The online pharmacies in question, often using websites set up overseas, sell prescription painkillers and other legal drugs without requiring that purchasers have a doctor’s prescription. They then deliver the drugs using commercial delivery services such as UPS and FedEx. Last Thursday, three men were convicted of running this form of illegal pharmacy and others have been convicted in the past.
Both UPS and FedEx reported the investigations in recent filings with the U.S. Securities and Exchange Commission. Both acknowledge that the investigation has been ongoing for several years. UPS is in cooperating with the DEA and attempting to reach a settlement. FedEx is denying any responsibility, claiming that there is no means by which a shipper could know the contents of the packages they carry.