In July 2019, Investors for Opioid Accountability, which has been at the forefront of the fight against the opioid crisis, broadened its focus to encompass companies with insulin and generic legal risks and those under scrutiny for anticompetitive practices. Now known as Investors for Opioid and Pharmaceutical Accountability (IOPA), this diverse global coalition of 60 public, faith-based, labor, and sustainability funds, as well as asset managers, represents investors with more than $4.4 trillion in assets under management.  

This year, multiple IOPA resolutions focus on gaps in governance practices. The coalition seeks board-level commitments to sustainable business models, as well as a change in board director leadership, where appropriate. IOPA’s engagements are specifically addressing independent board chairs, disclosure of adjustments to compensation metrics, misconduct clawback disclosure, board opioid risk reports, and the new issue of bonus deferral. IOPA agreed to not file or to withdraw the bonus deferral resolution at more than a dozen pharmaceutical manufacturers, distributors, and retail pharmacies that agreed to participate in a facilitated working group on the topic. IOPA expects very few bonus deferral resolutions will appear on proxies.

In addition to the new work on governance issues, IOPA continues to address opioid risk with pharmaceutical distributors, manufacturers, and retailers. The coalition added manufacturer Johnson & Johnson and retailer Walmart to the 13 companies previously engaged regarding risks of opioids; shareholders should see proposals requesting board oversight of opioid risks on these companies’ proxies. 

The expanded work with generic and insulin manufacturers, as well as pharmaceutical companies reported to engage in anticompetitive practices, brings the total to 26 companies engaged in the pharmaceutical supply chain.  In addition to the proposals discussed above, these proposals expand on the coalition’s previous proposals: 

• Independent chair proposals were filed at seven companies; three responded with no-action requests that the Securities and Exchange Commission rejected.

• Four proposals request adjustments to compensation metrics

• Four proposals address clawback disclosure

IOPA believes that this expanded focus will encourage companies to become more accountable for their business practices and the risks involved in the industry. By engaging pharmaceutical manufacturers, distributors, and retailers on governance issues and opioid risk, shareholders will continue to work to ensure fair, affordable access to health care.

Donna Meyer, Ph. D.
Director, Shareholder Advocacy, Mercy Investment Services