The CVS Caremark / CVS Pharmacy expired products problem

CVS Caremark Corp is a large national corporation which operated over 7,000 US drugstores under the name CVS Pharmacy. CVS Caremar Corp, or "CVS", or "CVS Pharmacy" for this blog post, has been the focus of lawsuits by state attorney generals in Connecticut and in New York for selling expired products, according to the Boston Globe.

In California, CVS Caremark was the focus of California Attorney General Jerry Brown, who in June of 2009, negotiated a $975,000 settlement of a civil lawsuit with CVS Pharmacy along with an agreement to give $2 coupons to anyone who found expired products on their shelves, and designates a toll-free number to call to report such items.

Now, there's a charge from a reliable source that CVS (formerly Long’s Drug stores in California) as well as Krogers, Ralphs, and other major chain stores are selling ‘diverted’ or grey market products that may counterfeited.

In some cases, the claim is the California consumer is even getting products that can be dangerous.

“Diverters” are companies are selling these stores products that have been diverted from their intended sales point or they may even be selling counterfeit products.

If this turns out to be the case, CVS will again be in violation of the same California laws under the Business and Professions Code 17200 and the Civil Code 1798.81 by misleading customers.

On August 14th of 2009, the Modesto Bee wrote wrote that a number of county district attorneys, including Stanislaus San Joaquin, Sacramento, San Bernardino and Solano counties have joined in the statewide lawsuit against several national retailers who stock beauty supplies alleged to violate California environmental law.

That lawsuit, originally brought by the District Attorney of Stanislaus County, sought penalties of at least $17 million, with amounts to be levied based on each day a prohibited hair product is offered for sale, according to court papers. The case also named Longs Drug Stores, Target, Rite Aid, Walgreens and Ralphs, among other defendants.

That lawsuit named a New Jersey company, Pro Choice Beauty Care Inc, that provides the products to the retail stores — without approval from the brand manufacturers. It is unclear how clear where Pro's Choice Beauty Care Inc. gets its products. It is believed to be a “diverter” of products.

The hair products that were being sold were found to contain elevated levels of smog-forming volatile organic compounds, state environmental authorities said, according to the Modesto Bee.
Stay tuned for more information as this story unfolds both here in the Bay Area and around California. I've made several calls to sources; I expect follow-ups soon.

American Red Cross explains unallocated Haiti donations in blog

The matter of the unallocated $175 million in American Red Cross Haiti donations focused on earlier, finally received attention via the American Red Cross' own blog, which this blogger happened to visit Tuesday. The post, written by Gloria Huang, reads as follows:

Recently, we’ve been seeing some confusion from readers and bloggers online about the allocation of funds for Haiti relief. We would like to clarify how our Haiti relief funds are being used and how we are planning for their allocation in the future.

In just over a month, the American Red Cross has already spent or allocated $80 million of the $276 million donated to meet the most urgent needs of Haiti’s earthquake survivors.

The $80 million allocated so far has gone towards immediate relief for Haitians – 69% for food and water, 20% for shelter, and 11% for health and family services. The remaining $196 million will be spent as the Red Cross continues to focus on finding communities and populations in need in Haiti in order to give them the things they can use to survive this difficult situation.

Every donated dollar will be spent on relief in Haiti; because of the generosity of our donors, people in Haiti will receive resources, support and training from the Red Cross that will help them recover and rebuild in the years ahead.

The error, then, is in the initial American Red Cross report, which still reads as follows:

Since the earthquake, the American Red Cross has raised approximately $255 million for the Haiti relief and recovery efforts. To date, it has spent or committed $80 million, with approximately 69 percent of the funds spent or committed for food and water; 20 percent for shelter; and 11 percent for health and family services. As the response progresses and recovery begins, the Red Cross will continue to support these priority areas and longer-term assistance initiatives.

The words "spent or committed $80 million" are what caught this blogger's attention. Note that the report fails to mention $175 million or $196 million for that matter. It was done only after attention was brought to the problems in the American Red Cross report by me.

Since then I've received a number of interesting emails and phone calls. Look, of an estimated $644 million raised for Haiti relief, one company, the American Red Cross, is responsible for one-third of that. Someone told me that the real reason for the omission of the $175 million was that when a person donated online they had to specifically designate where their money was going; if they did not click "Haiit", the donation went to the Red Cross' International Response Fund. The caller claims the International Response Fund money does not go to Haiti.

This link is to the donations page - DONATE. Note that Haiti is one of several choices. So the question is this: is the $175 million or now $196 million really donations just taken in, and only $80 million was captured because some donors clicked on the "Haiti" tag? And why doesn't the American Red Cross have a specific webpage and link button just for Haiti?

To this eye, it seems that the ARC is trying to use the Haiti issue to increase all of its donor coffers, not just that for Haiti.

So this matter's still open and is getting even more interesting. What's really funny is that because some disagree with these posts, and may be paid by the American Red Cross to respond to them via comments on the blog, they reach for the "wouldn't a journalist..." blast. That always happens when they don't agree. I remind them that I'm a blogger, far beyond a journalist. Bloggers have to mention their biases and can't hide behind the statements of false "experts". Bloggers - video or text - make it happen. Bloggers - especially video-bloggers - rock.