Chapter 43: “$$$$$$$$$$$$$ It’s Bonus Time in the Neighborhood!”

  1. 1. “New Hope for Millions of Americans Suffering from Persistent Pain,” PR Newswire, May 31, 1996, exhibits to litigation, in collection of author.
  2. 2. Full-page advertisements in medical journals left no doubt about how long a single dose was supposed to last. “Remember, Effective Relief Just Takes Two.” A spotlight lit two prescription cups, one labeled 8 AM and the other 8 PM. Ryan, Girion, and Glover, “You Want A Description Of Hell?”
  3. 3. “New Hope for Millions of Americans Suffering from Persistent Pain.”
  4. 4. See as an example what happened in one state, Massachusetts, with the Purdue sales representatives and the targeted doctors. Massachusetts v. Purdue, para. 112–16, 39.
  5. 5. Ibid., para. 33, 12
  6. 6. Ibid., 114, 39.
  7. 7. Elliott, “The Drug Pushers.”
  8. 8. 2018-02-18 deposition of Catherine Yates Sypek pg. 120; 2018-03-01 deposition of Timothy Quinn pg. 99, part of the court record in Massachusetts v. Purdue.
  9. 9. “If Only I Had a Brain,” Planning and Effective Presentation, from Training and Development to Entire Field Force, Dept. Sales-9521, November 4, 1996, 3 pages.
  10. 10. Ryan, Girion, and Glover, “You Want A Description Of Hell?”
  11. 11. Wild interview in Greg Crister, Generation Rx: How Prescription Drugs Are Altering American Lives, Minds, and Bodies (New York: Houghton Mifflin Harcourt, 2005), 100.
  12. 12. Summary Review for Regulatory Action, from Sharon Hertz, MD, re Division Director Summary Review, Purdue Pharma, NDA 22272/027, Center for Drug Evaluation and Research, FDA, copy in collection of author.
  13. 13. 2013-10-29 Sales & Marketing presentation to the Board, Massachusetts v. Purdue, document PPLP004409989.
  14. 14. See chart “OxyContin Prices,” Massachusetts v. Purdue para 68, 22. And Ryan, Girion, and Glover, “You Want A Description Of Hell?”
  15. 15. 2002-03-21 email from Merle Spiegel, Massachusetts v. Purdue, document PPLPC023000014497.
  16. 16. 2016-04-13 April Board meeting Commercial Update, slide 74, Massachusetts v. Purdue, document PPLPC016000286167.
  17. 17. Beall, “Purdue Pharma Plants The Seeds Of The Opioid Epidemic.”
  18. 18. Ryan, Girion, and Glover, “You Want A Description Of Hell?”
  19. 19. Thomas Landon Jr., “Maker of OxyContin Reaches Settlement With West Virginia,” New York Times, November 6, 2004.
  20. 20. “Is It Pain (2011)?,” slide 6, Massachusetts v. Purdue, document PTN000007194.
  21. 21. 2013-08-27 Opioid dosage data press release, PWG000216270; 2012-10-01 internal Purdue analysis, pg. 22, Massachusetts v. Purdue, document PWG000226041.
  22. 22. 2013-07 Publication Plan for Long-Term Opioid Therapy for Chronic Non-Cancer Pain, 3, Massachusetts v. Purdue, document PWG000323550.
  23. 23. “An Assessment of Opioid-Related Overdoses in Massachusetts 2011–2015,” Massachusetts Department of Public Health, August 2017.
  24. 24. “Prescription Drugs: OxyContin Abuse and Diversion and Efforts to Address the Problem,” December 2003.
  25. 25. 2012-02-15 10-Year Plan, slide 33, Massachusetts v. Purdue, document PWG000164240.
  26. 26. 2012-11-01 Board report, pg. 31, Massachusetts v. Purdue, document PWG000414917.
  27. 27. Haddox quoted in Macy, Dopesick, 20–21. Haddox told an addiction conference in New York in 2003: “If I gave you a stalk of celery and you ate that, it would be healthy. But if you put it in a blender and tried to shoot it into your veins, it would not be good.” Patrick Radden Keefe, “The Family That Built an Empire of Pain,” New Yorker, October 23, 2017.
  28. 28. Haddox left Purdue in October 2018. He now is with Opos Consulting, which describes itself on its website as “Opioid Management Strategies and Solutions.”
  29. 29. Purdue promoted its unorthodox view in publications it distributed directly to doctors and in bulk at medical conventions and to hospitals. Some included Medication Therapy Management; Providing Relief, Preventing Abuse: A Reference Guide to Controlled Substances Prescribing Practices; and Responsible Opioid Prescribing. 2007-11 Medication Therapy Management: Opportunities For Improving Pain Care, slide 31, PTN000006105; see also, Clinical Issues in Opioid Prescribing (2008), pgs. 1–3, Massachusetts v. Purdue, document PWG0000058054-055.
  30. 30. Morphine gets to the brain slightly slower than either oxycodone or heroin and as a result has never become a preferred drug for street addicts. “New Drug Application to FDA for OxyContin, Pharmacology Review: ‘Abuse Liability of Oxycodone.’ ” Purdue Pharma, Stamford, CT, 1995.
  31. 31. OxyContin prescription insert, page 4, 1996, in collection of author.
  32. 32. CDC Guideline for Prescribing Opioids for Chronic Pain (2016), at https://www.cdc.gov/mmwr/volumes/65/rr/rr6501e1.htm.
  33. 33. Van Zee, “The Promotion and Marketing of OxyContin,” 224.
  34. 34. Meier, “F.D.A. Bars Generic OxyContin.”
  35. 35. Barry Meier, “Origins of an Epidemic: Purdue Pharma Knew Its Opioids Were Widely Abused,” New York Times, May 29, 2018.
  36. 36. Richard Sackler, while the Senior Vice President for Sales, quoted at the OxyContin launch event, Massachusetts v. Purdue, document PKY180280951.
  37. 37. Gigen Mammoser, “Is OxyContin Losing Its Luster,” Healthline, February 21, 2018.
  38. 38. In another two years, during which time Purdue doubled its sales force and distributed tens of thousands of discount or free prescription coupons, prescriptions surpassed six million annually. Ryan, Girion, and Glover, “You Want A Description Of Hell?”; “Prescription Drugs: OxyContin Abuse and Diversion and Efforts to Address the Problem,” 2003. Van Zee, “The Promotion and Marketing of OxyContin,” 221–22; Joanna Walters, “America’s Opioid Crisis: How Prescription Drugs Sparked A National Trauma,” Guardian, October 25, 2017.
  39. 39. “OxyContin Marketing Plan, 2002,” 47 pages, Purdue Pharma, Stamford, CT, 2002, contributed to Document Cloud by Fred Shulte, Kaiser Health News,
  40. 40. From its first sales in 1996 through 2018, OxyContin brought $39 billion in revenue for Purdue. “Prescription Drugs: OxyContin Abuse and Diversion and Efforts to Address the Problem.” See also Gigen Mammoser, “Is OxyContin Losing Its Luster.”

Chapter 44: Talking Stomachs and Dead Presidents

  1. 1. Weissman et al., 2003; Molly M. Ginty, “Drug Ads Targeting Women Called Health Hazard,” We News, November 14, 2006.
  2. 2. Damian Garde, “Direct-to-Consumer Drug Advertising, Explained,” STAT, September 5, 2019.
  3. 3. May, “Selling Drugs by ‘Educating’ Physicians.”
  4. 4. The authority of OTC ads to the FTC was part of the 1938 Wheeler-Lea Act. See Address of R. E. Freer, Commissioner, Federal Trade Commission, before the annual convention of The Proprietary Association, Biltmore Hotel, New York, NY, May 17, 1938, regarding The Wheeler-Lea Act.
  5. 5. The Kefauver legislation required the FDA to draft advertising guidelines. It took the agency seven years to publish them.
  6. 6. Donohue, “A History of Drug Advertising.”
  7. 7. Code of Federal Regulations (CFR), Title 21, FDA, Drugs for Human Use, 202.1; C. Lee Ventola, “Direct-to-Consumer Pharmaceutical Advertising: Therapeutic or Toxic?” Pharmacy and Therapeutics, 2011 Oct; 36(10): 669–74.
  8. 8. CFR 21 314.81(b)(3)(I).
  9. 9. The volume of drug ads increased annually. Ad revenue at Arthur Sackler’s Medical Tribune and its dozen publications doubled every year for a decade. Wayne L. Pines, “A History and Perspective on Direct-to-Consumer Promotion,” Food and Drug Law Journal, vol. 54, no. 4, 1999, pp. 489–518.
  10. 10. Donohue, “A History of Drug Advertising,” 671.
  11. 11. Ibid., 662.
  12. 12. Michael K. Paasche-Orlow et al., “National Survey of Patients’ Bill of Rights Statutes,” Journal of General Internal Medicine, 2009 Apr; 24(4): 489–94.
  13. 13. Donohue, “A History of Drug Advertising,” 672.
  14. 14. Ibid., 673.
  15. 15. Elizabeth Watkins, “Expanding Consumer Information: The Origin of the Patient Package Insert,” Advancing the Consumer Interest, (1998) 10(1), 20–26, and “Doctor, Are You Trying to Kill Me?”: Ambivalence about the Patient Package Insert for Estrogen,” Bulletin of the History of Medicine (2002): 76(1), 84–104.
  16. 16. David Kessler and W. Pines, “The Federal Regulation Of Prescription Drug Advertising And Promotion,” JAMA, 1990 Nov 14;264(18):2409–15.
  17. 17. L.K. Harvey and S.C. Shubat, “Physician and Public Opinion on Health Care Issues,” American Medical Association, April 1991.
  18. 18. See Arthur Hull Hayes Jr., “Remarks by Arthur Hull Hayes, Jr.,” the Pharmaceutical Advertising Council, Inc., New York, February 18, 1982, copy in collection of author.
  19. 19. A Gallup poll showed that 58 percent of the public thought that Reagan’s proposed cuts were either “about right” or “too low.” Voters mostly believed Reagan’s argument that he was cutting only duplication and pork, and all the agencies would function just as well on lower budgets. Lydia Saad, “Spending Cuts Popular in Reagan’s 1981 Budget,” Gallup Vault, May 25, 2017.
  20. 20. Dingell to Hayes, Letter via Messenger, March 9, 1982, “Prescription Drug Advertising To Consumers,” Staff Report Prepared For The Use Of The Subcommittee On Oversight And Investigations Of The Committee On Energy And Commerce,” House Of Representatives, 98th Congress, 2nd Session, September 1984 (Washington, D.C.: U.S. Government Printing Office), 17–18.
  21. 21. Ventola, “Direct-to-Consumer Pharmaceutical Advertising.”
  22. 22. Comments of the staff of the FTC Bureau of Consumer Protection before the FDA in the matter of Request for Comments on Consumer-Directed Promotion, Docket 2003N-0344, December 1, 2003.
  23. 23. Donohue, “A History of Drug Advertising,” 679.
  24. 24. Staff Report, “Prescription Drug Advertising To Consumers,” 1984.
  25. 25. “Direct-To-Consumer Advertising Of Prescription Drugs: Withdrawal Of Moratorium,” Food and Drug Administration, Federal Register, 1985.
  26. 26. Steven Woloshin et al., “Direct-To-Consumer Advertisements For Prescription Drugs: What Are Americans Being Sold?” Lancet, 358, no. 9288, October 6, 2001, 1141–46.
  27. 27. Edmund L. Andrews, “F.D.A. Inquiry on Generic Drugs Focuses on Changes in Ingredients,” New York Times, July 31, 1989, 1.
  28. 28. Michael F. Mangano, “A Multi-Disciplinary Approach to Problem Solving: The Generic Drug Scandal,” The Government Accountants Journal, Fall 1992.
  29. 29. Bill Clinton reappointed Kessler in 1994. For overview of Kessler tenure at the FDA see Marian Burros, “F.D.A. Commissioner Is Resigning After 6 Stormy Years in Office,” New York Times, November 26, 1996, A1.
  30. 30. Ibid. Kessler had worked in the early 1980s as a consultant on food additive safety and tobacco regulation for Utah senator Orrin Hatch. It was Hatch who had suggested to President Bush that Kessler be appointed the FDA commissioner. However, once he was in charge at the FDA, Hatch became a critic. “If I have a big criticism of David, it is that he loves publicity and seeks it.”
  31. 31. Warren E. Leary, “Citing Labels, US Seizes Orange Juice,” New York Times, April 25, 1991, A18.
  32. 32. “Independent Review Group, Silicone Breast Implants: The Report of the Independent Review Group,” Institute of Medicine Committee on the Safety of Silicone Breast Implants, issued July 8, 1998; see also B. Diamond et al., “Silicone Breast Implants in Relation to Connective Tissue Diseases and Immunologic Dysfunction,” Report by a National Science Panel to the Honorable Sam C. Pointer Jr., Coordinating Judge for the Federal Breast Implant Multi-District Litigation, November 30, 1998.
  33. 33. Kessler was the first commissioner since James Goddard in the late 1960s to go after Big Tobacco. Kessler issued the so-called FDA Rule by which the agency attempted to restrict tobacco advertising since children were susceptible to it. Nicotine, he said, was a drug responsible for over 400,000 deaths annually. Big Tobacco brought the FDA to federal court. It took four years before a bitterly divided Supreme Court ruled 5–4 in favor of the tobacco industry. Two moderate justices joined with three conservatives for the slim majority. Sandra Day O’Connor wrote the majority decision, joined by Anthony Kennedy, Antonin Scalia, Clarence Thomas, and Chief Justice William Rehnquist.

    Kessler’s desire for the FDA to have jurisdiction over tobacco came to fruition in 2010 when Congress expanded the FDA’s authority in the Family Smoking Prevention and Tobacco Control Act. See FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120 (2000).

  34. 34. Congress passed protections in the Patient Self Determination Act in 1989 and the 1996 Health Insurance Portability and Accountability Act (HIPAA). See S. J. Nass, Levit L, Gostin L, eds, “Beyond the HIPAA Privacy Rule: Enhancing Privacy, Improving Health Through Research,” Institute of Medicine (US) Committee on Health Research and the Privacy of Health Information (Washington, D.C.: National Academies Press, 2009).
  35. 35. Donohue, “A History of Drug Advertising,” 680, 682.
  36. 36. Leslie Weiss, “Radical Plan From Newt Gingrich’s Think Tank To Gut FDA,” Mother Jones, September/October 1995.
  37. 37. Burros, “F.D.A. Commissioner Is Resigning After 6 Stormy Years in Office.”
  38. 38. Also coming up were: loratidine (OTC in 2002), omeprazole (2004), orlistat (2007), and cetirizine (2008).
  39. 39. Rich Thomaselli, “Ten Years Later: Direct to Consumer Drug Advertising,” Adage, October 1, 2006.
  40. 40. Ibid. And see GAO report number GAO-03-177, “Prescription Drugs: FDA Oversight of Direct-to-Consumer Advertising Has Limitations,” released December 4, 2002.
  41. 41. Michael C. Gerald, “The Rise and Fall of Celebrity Promotion of Prescription Products in Direct-to-Consumer Advertising,” Pharmacy in History, Vol. 52, No. 1 (2010), 13–23.
  42. 42. Ibid. See also M. S. Wilkes et al., “Direct-To-Consumer Prescription Drug Advertising: Trends, Impact, And Implications,” Health Aff, 2000, 19:110-28; David Herzberg, “Will Wonder Drugs Never Cease. A Prehistory of Direct-to-Consumer Advertising,” Pharmacy in History 51 (2009): 47–56.
  43. 43. Gerald, “The Rise and Fall of Celebrity Promotion of Prescription Products in Direct-to-Consumer Advertising.” See “The Impact Of Direct-To-Consumer Drug Advertising On Seniors’ Health And Health Care Costs,” Hearing before Special Committee On Aging, United States Senate, 109th Congress, First Session (2005).
  44. 44. Warner-Lambert had developed Lipitor and was ready to sell it in 1996. At the last moment it reached a marketing agreement with Pfizer, whose sales force was considered one of the industry’s best.
  45. 45. Pfizer cut Jarvik loose (but let him keep his $1.35 million fee) and instead went to a subdued ad featuring a San Francisco talent agent who had gone on Lipitor after surviving a heart attack. Although the dustup did not hurt Lipitor’s sales, it did revive doubts about the accuracy of drug television ads. Gerald, “The Rise and Fall of Celebrity Promotion of Prescription Products in Direct-to-Consumer Advertising.”
  46. 46. Mark Morford, “Giant Floating Purple Pills / Are Those Creepy Prescription-Drug Commercials On TV Trying To Kill You?,” San Francisco Chronicle, November 21, 2003.
  47. 47. Jim Edwards, “Lies, Damned Lies, and Drug Advertising: Judge Turns Blind Eye to AZ’s ‘Deceptive’ Purple Pill Ads,” Moneywatch, CBS News, May 11, 2010.
  48. 48. Years later, even after Nexium’s patent protection had expired, AstraZeneca battled to keep the capsule’s color exclusive. When India-based Dr. Reddy’s Laboratories released a generic with two shades of purple in September 2015, AztraZeneca sued, claiming that patients would be confused by the similarity of the brand name’s color. The case was settled out of court when Dr. Reddy’s changed the color of its generic to blue. See El Silverman, “Maker of Generic Version of Nexium Goes to Blue to Settle Litigation,” Stat, January 4, 2016.
  49. 49. Kesselheim, “The High Cost of Prescription Drugs in the United States,” 862–65.
  50. 50. Herper, “The Best-Selling Drugs In America.”
  51. 51. Edwards, “Lies, Damned Lies, and Drug Advertising”; Stuart Elliott, “AstraZeneca Sued Over Advertising,” New York Times, October 19, 2004.
  52. 52. Ginty, “Drug Ads Targeting Women Called Health Hazard”; Jin In, “Marketing Mother’s Little Helper,” We News, June 23, 2002.
  53. 53. Scott Hensley, “Remember Vioxx? Merck Settles Marketing Charges From Way Back,” NPR, November 22, 2011; Snigdha Prakash and Vicki Valentine, “Timeline: The Rise and Fall of Vioxx” in “Special Series, Vioxx: The Downfall of a Drug,” NPR, November 10, 2007.
  54. 54. Thomaselli, “Ten Years Later: Direct To Consumer Drug Advertising.” Direct-to-consumer ads “had gotten away from us,” Kessler later said.
  55. 55. Donohue, “A History of Drug Advertising.”
  56. 56. Pharma spending on consumer ads skyrocketed. One year after the fallout over the Vioxx ads had caused a momentary hiccup, drug firms spent $4.2 billion on DTCA, 40 percent of all industry promotion. As of 2019, a study in JAMA reported that DTCA had reached $9.6 billion annually, “mostly TV commercials and glossy magazine ads.” It was another record for consumer ads. L. M. Schwartz and S. Woloshin, “Medical Marketing in the United States, 1997–2016,” JAMA 2019;321(1):80–96. Separately, pharma spent $20 billion on marketing to doctors and health care professionals.

Chapter 45: “We Have to Hammer on the Abusers”

  1. 1. The six states were Kentucky, West Virginia, Ohio, Pennsylvania, Maine, and Virginia. See for example Karin Meadows, “Alcohol, Drugs May Be Culprits in Deaths in Leesburg,” Orlando Sentinel, December 30, 1998, 1.
  2. 2. “Prescription Drugs: OxyContin Abuse and Diversion and Efforts to Address the Problem,” 2003, 9.
  3. 3. “Overview of the Public Health Burden of Prescription Drug and Heroin Overdoses: How We Got to Now?” National Center for Injury Prevention and Control Division of Unintentional Injury Prevention, CDC, July 1, 2015. As for the ER cases treated, see Sujata S. Jayawant and Rajesh Balkrishnan, “The Controversy Surrounding Oxycontin Abuse: Issues And Solutions,” Therapeutics And Clinical Risk Management vol. 1,2 (2005), 80.
  4. 4. “Diversion here was, at least in part,” concluded Passik, “a matter of self-medicating loss of hope, feeding one’s family and seeking escape run amok. It could have been OxyContin, it could have been anything else.” Steven Passik, “Same As It Ever Was? Life After the OxyContin Media Frenzy,” Journal of Pain and Symptom Management, Volume 25, Issue 3, March 2003, 199–201.
  5. 5. “OxyContin Diversion and Abuse,” Information Bulletin, National Drug Intelligence Center, U.S. Department of Justice, Product No. 2001-L0425-001, January 2001, 3. See also Substance Abuse and Mental Health Services Administration, Drug Abuse Warning Network, 1997-1998: Area Profiles of Drug-Related Mortality. HHS Publication No. (SMA) 12-4699, DAWN Series D-3 (Rockville, MD: Substance Abuse and Mental Health Services Administration, 1999).
  6. 6. “Oxycontin: Balancing Risks And Benefits,” Hearing Of The Committee On Health, Education, Labor, And Pensions, U.S. Senate, 107th Congress, Second Session; “On Examining The Effects Of The Painkiller OxyContin, Focusing On Federal, State And Local Efforts To Decrease Abuse And Misuse Of This Product While Assuring Availability For Patients Who Suffer Daily From Chronic Moderate To Severe Pain,” February 12, 2002, Senate Committee on Health, Education, Labor, and Pensions (Washington, D.C.: U.S. Government Printing Office, 2002).
  7. 7. Statement and Testimony of Jay P. McCloskey for the Hearing Before the Committee on the Judiciary, United States Senate on “Evaluating the Propriety and Adequacy of the OxyContin Criminal Settlement,” July 31, 2007 (hereinafter “McCloskey Judiciary Committee Statement and Testimony 2007”).
  8. 8. 1999-06-17 email from Michael Friedman, reference #228728.1 and 1998-09-28 email from Richard Sackler, Massachusetts v. Purdue document PDD1701546497.
  9. 9. ‘’OxyContin Marketing Plan, 2002.’’ Purdue Pharma, Stamford, CT, 2002; Van Zee, “The Promotion and Marketing of OxyContin.”
  10. 10. McCloskey Judiciary Committee Statement and Testimony 2007.
  11. 11. “OxyContin: Balancing Risks And Benefits,” Senate, 2002, 57.
  12. 12. McCloskey Judiciary Committee Statement and Testimony 2007.
  13. 13. McCloskey summary of the meeting, Ibid.
  14. 14. Meier, “Origins of an Epidemic.”
  15. 15. J. C. Crews and D. D. Denson, “Recovery Of Morphine From A Controlled-Release Preparation: A Source Of Opioid Abuse,” Cancer 1990;66:2642–44.
  16. 16. McCloskey Judiciary Committee Statement and Testimony 2007.
  17. 17. Van Zee, “The Promotion and Marketing of OxyContin.”
  18. 18. Jared S. Hopkins, “OxyContin Made The Sacklers Rich. Now It’s Tearing Them Apart,” Wall Street Journal, July 13, 2019. According to Hopkins, “some people close to the family said Mortimer opposed tapping Raymond’s son Richard Sackler to be president in 1999…”
  19. 19. All opioid overdoses were less than half of the reported four thousand Americans who died of drugs in 1999, and OxyContin was only one of the opioid-based painkillers on the market. See “Opioid Overdose Death Rates and All Drug Overdose Death Rates per 100,000 Population (Age-Adjusted),” 1999, State Facts, Kaiser Family Foundation.
  20. 20. Summary Review. Application number: 022272Orig1s027 (OxyContin). Center For Drug Evaluation And Research, FDA.
  21. 21. Jayawant and Balkrishnan, “The Controversy Surrounding OxyContin Abuse: Issues And Solutions,” 77–82.
  22. 22. James Inciardi and Jennifer Goode, “OxyContin and Prescription Drug Abuse,” Consumer’s Research, July 2003, 17.
  23. 23. Purdue’s new phase of promotion targeted arthritis sufferers and resulted in the FDA’s first complaint filed against the company. It charged the ad addressed conditions for which it was not approved. Purdue was prepared to contest it but general counsel Howard Udell convinced the Sacklers it was not worth souring their relationship with the chief regulatory agency that up to that time had been accommodating. Purdue voluntarily withdrew the advertisement. “Opioids and Women: From Perspective to Addiction,” National Women’s Health Network, May 2018.
  24. 24. Purdue company statement quoted in Barry Meier, “At Painkiller Trouble Spot, Signs Seen as Alarming Didn’t Alarm Drug’s Maker,” New York Times, December 10, 2001, 1.
  25. 25. Inciardi and Goode, “OxyContin and Prescription Drug Abuse,” 21.
  26. 26. 1997-02-27 email from Robert Kaiko, document PDD1701345999; 1997-03-02 email from Richard Sackler, Massachusetts v. Purdue document PDD1701345999.
  27. 27. 2000-11-30 email from Michael Friedman, Massachusetts v. Purdue document PDD1706196247.
  28. 28. 2000-12-01 email from Mortimer D. Sackler, Massachusetts v. Purdue document PDD1706196246.
  29. 29. Author interview with former Purdue assistant marketing manager, February 2017.
  30. 30. Inciardi and Goode, “OxyContin and Prescription Drug Abuse.” As for the figure of twenty-fold in four years, see the GAO report of December 2003, “Prescription Drugs: OxyContin Abuse and Diversion and Efforts to Address the Problem.”
  31. 31. R. Lagos et al., “The Face Of Hillbilly Heroin And Other Images Of Narcotic Abuse,” West Virginia Medical Journal, 2010;106(4 Spec No):34-37. Fox Butterfield was the first New York Times reporter to use the term in a July story, “Theft of Painkiller Reflects its Popularity on the Street,” July 7, 2001, A5. For other slang for OxyContin, see Jayawant and Balkrishnan, “The Controversy Surrounding OxyContin Abuse.”
  32. 32. Julian Borger, “Hillbilly Heroin: The Painkiller Abuse Wrecking Lives In West Virginia,” Guardian (UK), June 24, 2001. As for the average annual incomes in those states, $24,500 in Kentucky in 2000: https://www.statista.com/statistics/205414/per-capita-personal-income-in-kentucky/. And in West Virginia it was $22,000: https://www.statista.com/statistics/205577/per-capita-personal-income-in-west-virginia/. A later study that evaluated data from West Virginia’s Controlled Substance Monitoring Program showed that Medicaid patients had “substantially higher” opioid prescription rates than those privately insured; also the rate of opioid misuse was higher than the state average. See G. L. Peirce et al., “Doctor and Pharmacy Shopping for Controlled Substances,” Med Care, 50(6):494–500, June 2012.
  33. 33. Drugstores in southeast Kentucky, for instance, could not keep pill crushers in stock. Francis X. Clines and Barry Meier, “Cancer Painkillers Pose New Abuse Threat,” New York Times, February 9, 2001, 1, 115.
  34. 34. Borger, “Hillbilly Heroin.”
  35. 35. Famularo and Haddox quoted in Clines and Meier, “Cancer Painkillers Pose New Abuse Threat.”
  36. 36. 2001-02-08 email from Richard Sackler, Massachusetts v. Purdue document PDD8801151727.
  37. 37. Author interview with former assistant production manager, February 2017.
  38. 38. M. N. Pastore et al., “Transdermal Patches: History, Development And Pharmacology,” British Journal Of Pharmacology (2015), 172(9), 2179–2209. See also Julia Lurie, “A Brief, Blood-Boiling History of the Opioid Epidemic: From OxyContin Coupons To Fentanyl-Laced Heroin, This Is How The Crisis Unfolded,” Mother Jones, Jan/Feb 2017.
  39. 39. J. Suzuki and S. El-Haddad, “A Review: Fentanyl And Non-Pharmaceutical Fentanyls,” Drug Alcohol Depend. 2017 Feb 1;171:107–16.
  40. 40. John Carreyrou, “Narcotic ‘Lollipop’ Becomes Big Seller Despite FDA Curbs,” Wall Street Journal, November 3, 2006, 1.
  41. 41. Jerald King v. Frank Baldino, Civil Action No. 08-54-GMS-MPT, In the United States District Court for the District of Delaware, ruling issued August 26, 2009. See also Carreyrou, “Narcotic ‘Lollipop’ Is Big Seller Despite FDA Curbs”; Jim Edwards, “Judge Revisits Cephalon’s Off-Label Madness: Actiq is ‘an ER on a Stick!’ ” CBS News Moneywatch, September 2, 2009; “Lollipop Made With Powerful Opioid Fentanyl Was Illegally Marketed, Ex-Pharma Rep Says,” CBS News, “Whistleblower,” June 28, 2019.
  42. 42. Inciardi and Goode, “OxyContin and Prescription Drug Abuse.”
  43. 43. “OxyContin Diversion and Abuse,” Information Bulletin, National Drug Intelligence Center, U.S. Department of Justice, Product No. 2001-L0425-001, January 2001, 3.
  44. 44. 2001-02-01 email from Richard Sackler, Massachusetts v. Purdue document PDD8801133516.
  45. 45. “Abusers aren’t victims; they’re victimizers,” Sackler wrote that same month to an acquaintance.
  46. 46. Frank Berger, the scientist who discovered Miltown, told a congressional committee that “Alcohol, when used improperly, can be habit forming. But you don’t find a warning to that effect on a bottle of beer.” He told The New York Times the problem was that users abused it. “One just expects it will be used properly.” Benedict Carey, “Frank Berger, 94, Miltown Creator, Dies,” New York Times, March 28, 2008.
  47. 47. Barry Meier and Melody Petersen, “Sales of Painkiller Grew Rapidly, But Success Brought a High Cost,” New York Times, March 5, 2011, 1, 61.
  48. 48. Ibid.
  49. 49. Ibid.
  50. 50. When the Times article ran, the amount paid by drug companies to physicians for speaking engagements was not public knowledge. Later, some of what Purdue paid became public as a result of litigation discovery. Since 2010, companies are required to report their payments. In the years since disclosure, the annual reported payments have varied from $12 million to $24 million. https://projects.propublica.org/docdollars/company/purdue-pharma-l-p.
  51. 51. Inciardi and Goode, “OxyContin and Prescription Drug Abuse.”
  52. 52. DuPont had released naltrexone under the brand name Trexan in 1984 for opioid dependence. Clinical trials later demonstrated it was also useful in reducing alcohol cravings. Elaine A. Moore, The Promise of Low Dose Naltrexone Therapy: Potential Benefits in Cancer (Jefferson, NC: McFarland Books, 2008).
  53. 53. “Decision Of The Director General Of Fair Trading No Ca98/2/2001 in the matter of Napp Pharmaceutical Holdings Limited And Subsidiaries (Napp),” pursuant to the Competition Act 1998, March 30, 2001, 72 pages, in collection of author.
  54. 54. Laura Nagel, Deputy Assistant Administrator, Drug Enforcement Administration, Speech to American Association for the Treatment of Opioid Dependence, Washington, D.C., April 14, 2003.
  55. 55. Meier, Pain Killer, 53.
  56. 56. “Summary: Health Impact Of The Napp Technologies Fire,” Division of Environmental and Occupational Health Services, New Jersey Department of Health and Senior Services, April 1997.
  57. 57. “Lodi Plant Faces Fines for Fatal Blast,” Ashbury Park Press, October 19, 1995, 6; “Chemical Explosion Kills Four at New Jersey Plant,” Capital Times (New Jersey), April 22, 1995, 8; “4 Killed in Lodi Explosion,” Ashbury Park Press, A1, A7.
  58. 58. “Lodi Plant Faces Fines for Fatal Blast.”
  59. 59. Author interview with former Purdue assistant marketing manager, July 2018.
  60. 60. Massachusetts v. Purdue 186, n. 85, citing Meier, Pain Killer, 158.
  61. 61. Udell quoted in Meier, Pain Killer, 111.
  62. 62. 2014-02-14 email from Russell Gasdia, Massachusetts v. Purdue document PPLPC012000464424.
  63. 63. “Prescription Drugs: OxyContin Abuse and Diversion and Efforts to Address the Problem,” 2003.
  64. 64. Author interview with former DEA official involved in the original OxyContin investigation, February 28, 2019.
  65. 65. Jayawant and Balkrishnan, “The Controversy Surrounding OxyContin Abuse.”
  66. 66. Benjamin Lesser, Dan Levine, Lisa Girion, and Jaimi Dowdell, “How Judges Added To The Grim Toll Of Opioids,” A Special Investigation, Hidden Injustice, Reuters, June 25, 2019.
  67. 67. Ashanti M. Alvarez, “Arrests Heighten Battle Over Pain Killer,” The Record, New Jersey, July 6, 2001, A1, A18.
  68. 68. Ibid.
  69. 69. Ibid.
  70. 70. “Did the FDA Ignite the Opioid Epidemic?” 60 Minutes, February 24, 2019.
  71. 71. FDA Issues New Warnings on Painkiller OxyContin, WebMD, July 26, 2001.
  72. 72. Author interview with former Purdue assistant marketing manager, July 2018.
  73. 73. Caitlin Esch, “How One Sentence Helped Set Off The Opioid Crisis,” Marketplace, December 13, 2017.
  74. 74. “Prescription Drugs: OxyContin Abuse and Diversion and Efforts to Address the Problem,” 2003.
  75. 75. Ibid., Appendix II: Summary of FDA Changes to the Original Approved OxyContin Label,” 48–52.
  76. 76. “Did the FDA Ignite the Opioid Epidemic?”
  77. 77. “Prescription Drugs: OxyContin Abuse and Diversion and Efforts to Address the Problem,” 48–52.
  78. 78. David Kessler interviewed in “Did the FDA Ignite the Opioid Epidemic?”
  79. 79. Andrew Kolodny interviewed in Ibid.
  80. 80. Ed Thompson interviewed in Ibid.
  81. 81. “Did the FDA Ignite the Opioid Epidemic?”
  82. 82. “OxyContin: Its Use And Abuse,” House of Representatives, Committee on Energy and Commerce, Subcommittee on Oversight and Investigations, Serial 107-54, August 28, 2001, 107th Congress, First Session.
  83. 83. Purdue’s Totowa, New Jersey, plant was 110 miles away from the Cardinal Health recipient in Swedesboro, New Jersey. Connected by I-95, the typical travel time is two hours. In the case of the missing OxyContin, a truck brought the Oxy to Newark International Airport where it was transferred to another truck that then drove it to Philadelphia. From there it was loaded on a cargo plane for Dayton, Ohio, after which it was flown back to Philadelphia. When the crate was opened on the truck that took it on its last leg to Swedesboro, the OxyContin was missing. “$800,000 in Painkilling Pills Disappear on a Zigzag Route,” New York Times, December 22, 2001.
  84. 84. Randolph Lievertz prescribed six times as much OxyContin as the next biggest dispenser in Indiana. The prescriptions he wrote were for so many pills that patients would have had to take thirty-one OxyContin tablets every twelve hours instead of the one approved by the FDA. Barry Meier, “Doctor to Face U.S. Charges in Drug Case,” New York Times, December 23, 2001.
  85. 85. Caryn James, “Television Review; A Painkiller’s Double Life as an Illegal Street Drug,” New York Times, December 12, 2001.
  86. 86. Pain management advocates always pushed back against state prescription-monitoring systems. They contended such systems created undue fear among doctors and therefore punished chronic pain sufferers. By the time OxyContin was released in 1996, only fourteen states had prescription-monitoring systems. That made it impossible in the other thirty-six to determine if a patient obtained multiple prescriptions from different doctors and filled them at separate pharmacies. Melody Petersen and Barry Meier, “Few States Track Prescriptions As Way to Prevent Overdoses,” New York Times, December 21, 2001.
  87. 87. Peter Provet, President, Odyssey House, “OxyContin Abuse,” Letters to the Editor, New York Times, December 27, 2001.
  88. 88. Hutchinson testimony before the House Appropriations Subcommittee on Commerce, Hearings on OxyContin Abuse, Decemeber 11, 2001, at https://www.c-span.org/video/?167770-1/oxycontin-abuse. See also Barry Meier, “Official Faults Drug Company For Marketing of Its Painkiller,” New York Times, December 12, 2001.
  89. 89. Goldenhiem testimony before the House Appropriations Subcommittee on Commerce, Hearings on OxyContin Abuse, December 11, 2001, at https://www.c-span.org/video/?167770-1/oxycontin-abuse.
  90. 90. Meier, “Official Faults Drug Company For Marketing of Its Painkiller.”
  91. 91. Inciardi and Goode, “OxyContin and Prescription Drug Abuse.”
  92. 92. Elliott, “The Drug Pushers”; Meyers, Happy Accidents, 4693 of 6459.
  93. 93. Jayawant and Balkrishnan, “The Controversy Surrounding Oxycontin Abuse.”
  94. 94. Purdue also distributed one of the few sets of good statistics. The National Institutes of Health’s Monitoring the Future survey had since 1975 assessed annually the extent of prescription drug abuse and illegal drug use among eighth- through twelfth-grade students (mostly fourteen to eighteen years). The survey conducted in 2002 added for the first time some questions about OxyContin. Less than 4 percent of the students admitted to trying OxyContin and fewer than half of 1 percent said they had taken it to get high. Nearly 10 percent had tried other opioids such as Percocet, Lortab, or Vicodin. Inciardi and Goode, “OxyContin and Prescription Drug Abuse.”

Chapter 46: “Giving Purdue a Free Pass”

  1. 1. Fred Schulte, “Internal Documents: Purdue Pharma Knew OxyContin’s Risks, Pushed It Anyway,” Kaiser Health News, June 13, 2018.
  2. 2. Meier, “At Painkiller Trouble Spot.” Also see “Pulse Check. Trends in Drug Abuse. January–June 2001 Reporting Period. Special Topic: Synthetic Opioids,” Office of National Drug Control Policy, Washington, D.C., 2001.
  3. 3. It was $300,000 more than any other sales territory. See Meier, Pain Killer, 40.
  4. 4. Meier, “At Painkiller Trouble Spot.”
  5. 5. Author interview with former Purdue assistant marketing manager, February 2017.
  6. 6. Alabama, Arkansas, Kentucky, Indiana, Louisiana, Michigan, Mississippi, North Carolina, Ohio, Oklahoma, South Carolina, Tennessee, and West Virginia had between 96 and 143 prescriptions written per 100 people. See IMS, National Prescription Audit, 2012.
  7. 7. The Centers for Disease Control in 2006 started compiling annual opioid prescribing statistics by county. See also Julie Appleby and Elizabeth Lucas, “Doctors Can Change Opioid Prescribing Habits, But Progress Comes In Small Doses,” Kaiser Health News, August 14, 2019.
  8. 8. Katherine Hoover was the West Virginia doctor. German Lopez, “This Doctor Wrote 130 Opioid Prescriptions A Day. She Says She Did Nothing Wrong,” Vox, September 26, 2018.
  9. 9. Zoe Matthews, “AG: North Andover Doctor Was Top Prescriber Of OxyContin,” Eagle Tribune (North Andover, MA), February 6, 2019.
  10. 10. Andover’s Dr. Walter Jacobs, for instance, received $50,000 to talk to other physicians about opioids and pain treatment. Meanwhile, Purdue netted an estimated $3 million from the OxyContin he prescribed. 2001-06-25 spreadsheet attached to email from Kathy Doran (re Thought Leaders), Document PPLPC012000038726; 2010-10-06 Consultant Services Agreement signed by Russell Gasdia and Walter Jacobs, Massachusetts v. Purdue document PPLP003479945.
  11. 11. 2012-10-02 email from Yoni Falkson, Massachusetts v. Purdue document PLPC012000392932. “Purdue Pharma Family Sought To Profit Off Opioid Crisis, Filing Alleges,” PBS News Hour, February 1, 2019.
  12. 12. Meier, “Origins of an Epidemic.”
  13. 13. Massachusetts v. Purdue, para 135–37, 45–46.
  14. 14. See “Prescription Drugs”: OxyContin Abuse and Diversion and Efforts to Address the Problem,” GAO Report, 2003.
  15. 15. Four months earlier, the DEA’s director, Asa Hutchinson, had testified to Congress that there had been 282 OxyContin overdose deaths. Purdue dismissed that conclusion and attacked the media reports of abuse and diversion as fake news.
  16. 16. The author also obtained a twenty-page printout of a related but streamlined PowerPoint presentation by Laura Nagel’s Office of Diversion Control at the sixty-fourth annual meeting of the College on Problems of Drug Dependence. It was held June 8–13 in Quebec City, Canada.
  17. 17. Author interview with former DEA official involved in the original OxyContin investigation, February 28, 2019.
  18. 18. David V. Gauvin, Christine Sannerud, Frank Sapienza, “Two-Year Incidence of Fatal Adverse Drug Events Associated with Single-Entity Oxycodone Products: A Review of 1,304 Cases.” From the Drug and Chemical Evaluation Section, Office of Diversion Control, Drug Enforcement Administration, Washington, D.C., undated, twenty-six pages, in collection of author.
  19. 19. All of the descriptions of the DEA presentation and its findings are from the author’s review of David V. Gauvin, Christine Sannerud, and Frank Sapienza, “Two-Year Incidence of Fatal Adverse Drug Events Associated with Single-Entity Oxycodone Products: A Review of 1,304 Cases.”
  20. 20. Lev Facher, “Fentanyl And Other Synthetic Opioids Contributed To More Overdose Deaths In 2016 Than Prescription Painkillers,” STAT, May 1, 2018.
  21. 21. “Meeting, Presentation: DEA, Headquarters, 2002, Present: DEA Staff, Dr. Debra Leiderman FDA, Friedman, Udal [sic] Dr. Goldenheim, in collection of author.
  22. 22. DEA notes of April 2002 meeting, in collection of author.
  23. 23. Years later the FDA complained the DEA had not shared the 1,304 death records, while the DEA said the records were available for review, but no one had done so. Meier, “At Painkiller Trouble Spot.”
  24. 24. Author interview with former DEA official involved in the original OxyContin investigation, February 28, 2019.
  25. 25. Barry Meier, “OxyContin Deaths May Top Early Count,” New York Times, April 15, 2002.
  26. 26. Author interview with former DEA official involved in the original OxyContin investigation, February 28, 2019.
  27. 27. Notes from DEA officer regarding submission to NEJM, in collection of author.
  28. 28. “Evaluating the Propriety and Adequacy of the OxyContin Criminal Settlement,” Hearing before the Committee on the Judiciary, US Senate 110th Congress, first session July 31, 2007 (US Government Printing Office, Washington: 2008), 15.
  29. 29. United States Attorney’s Office for the District of Columbia archive by year, www.justice.gov/usao-dc.
  30. 30. Daniel C. Richman, “Political Control of Federal Prosecutions: Looking Back and Looking Forward,” 58 Duke L. J. 2087 (2009).
  31. 31. “Evaluating the Propriety and Adequacy of the OxyContin Criminal Settlement,” Senate 2008, 15.
  32. 32. The paper’s public editor, Daniel Okrent, had extensively addressed Purdue’s complaints in a December 21, 2003, column, “You Can Stand on Principle and Still Stub a Toe.” Okrent noted that the paper’s written policy was that “staff members must never give an impression that they might benefit financially from the outcome of news events.” Okrent said “after talking to authorities both parties directed me to, I believe Meier’s reporting was generally accurate and fair, even if the way some of the pieces were played—placement, headline, frequency, etc.—sometimes seemed the work of an especially ferocious terrier that had gotten its teeth into someone’s ankle.” According to Okrent, “Even if Barry Meier was not going to see dollars pouring in from writing about OxyContin, and even if he was the Times reporter who knew the most about oxycodone-based painkilling medication, and even if Udell’s demand was perceived as a disingenuous effort to intimidate the paper into altering its coverage—despite all this, there did exist the appearance of a conflict.”
  33. 33. Stuart Baker’s law firm, Chadbourne & Parke, was one of the two that advised on the early litigation defense. The other was Atlanta’s King & Spaulding. Meier, Pain Killer, 144.
  34. 34. Udell quoted in Ibid. Udell told Corporate Counsel Business Journal in September 2002 that Purdue had spent $45 million on legal expenses and the bills were escalating at $3 million per month. Macy, Dopesick, 68.
  35. 35. Author interview with former Purdue assistant marketing manager, February 2017.
  36. 36. John Solomon and Matthew Mosk, “The Importance of Being Rudy,” Seattle Times, May 15, 2007.
  37. 37. 2008-01-15 Board report, pgs. 4, 22, 24, Massachusetts v. Purdue document PDD8901733977.
  38. 38. Solomon and Mosk, “The Importance of Being Rudy.”
  39. 39. Nagel quoted in Ibid.
  40. 40. Tandy became the DEA director in January 2003 when Hutchinson went to run the Border and Transportation Security division at the newly created Department of Homeland Security.
  41. 41. Kerik quoted in Chris Smith, “American Idol,” New York, September 6, 2002. Kerik was sentenced to four years in prison in 2010 after he pled guilty to eight felonies, ranging from lying to White House officials tax fraud. Sam Dolnick, “Kerik Is Sentenced in Corruption Case,” New York Times, February 16, 2010.
  42. 42. Author interview with former DEA official involved in the original OxyContin investigation, February 28, 2019.
  43. 43. David Kessler, the crusading chief of the FDA, was not involved with OxyContin’s approval when he ran the agency in 1996. This was when the Sackler directors shuffled some of their own corporate titles. Richard Sackler, for instance, resigned as CEO and appointed as his replacement his trusted, longtime colleague Michael Friedman. However, the swapping of titles was mostly window dressing that hid the extent to which the family continued to run the firm.
  44. 44. The investigation was the Florida attorney general’s office File No. L01-3-2535; from that investigation, Kaiser Health News has published Purdue’s internal budget documents from 1996 to 2002 online at https://khn.org/news/purdue-and-the-oxycontin-files/.
  45. 45. Author interview with former Purdue assistant marketing manager, July 2018. See “OxyContin Abuse Shatters Drug Company’s Low Profile,” Hartford Courant, September 2, 2001, 1, 26.
  46. 46. Ethan Barton, “American Cartel: Here Are The Politicians That Took Opioid Tycoons’ ‘Dirty, Bloody Money,’ ” Investigative Group, Daily Caller, March 14, 2008.
  47. 47. Matthew Perrone and Ben Wieder, “Pro-Painkiller Echo Chamber Shaped Policy Amid Drug Epidemic,” Part 2 of 3, The Center for Public Integrity copublished with The Associated Press, September 19, 2016; IMS Health and citation for FEC for chart “The Politics of Pain.” The spending was during the decade 2006 to 2016.
  48. 48. Ibid., Perrone and Wieder, “Pro-Painkiller Echo Chamber.”
  49. 49. Agreement dated November 1, 2002, between the Office of the Attorney General, Department of Legal Affairs, State of Florida, and Purdue Pharma L. P. and Purdue Frederick Company, 9 pages, and Exhibits A and B and a 3-page amendment dated April 25, 2003, in files of author.
  50. 50. Lizette Alvarez, “Florida Shutting ‘Pill Mill’ Clinics,” New York Times, August 31, 2011.
  51. 51. Barry Meier, “Opioid Makers Are the Big Winners in Lawsuit Settlements,” New York Times, December 26, 2018.
  52. 52. See “OxyContin: Balancing Risks and Benefits,” Senate Hearing before the Committee on Health, Education, Labor and Pensions, 107th Congress, second session, February 12, 2002.
  53. 53. Purdue contributed $10,000 to Senator Dodd in 2002, more than any other federal politician. Barton, “American Cartel.”
  54. 54. The 257 cases resulted in 302 arrests and $1 million in fines, separate from the civil settlement with Purdue. Solomon and Mosk, “The Importance of Being Rudy.” See also “In fiscal years 2001 and 2002, GAO’s report noted, the Drug Enforcement Administration initiated 257 OxyContin-related abuse and diversion cases, which resulted in 302 arrests and about $1 million in fines,” “FDA Approves Generic OxyContin,” American Journal of Health-System Pharmacy, April 23, 2004.
  55. 55. Author interview with former Purdue assistant marketing manager, February 2017.
  56. 56. Sam Dolnick, “Kerik is Sentenced in Corruption Case,” New York Times, February 18, 2010, A1.

Chapter 47: “You Messed with the Wrong Mother”

  1. 1. Some had also been filed by OxyContin patients who claimed the drug had been falsely marketed since it did not provide a full twelve hours of pain relief. See Ryan, Girion, and Glover, “You Want A Description Of Hell?”; Bob Braun, “A Chilling Attempt at Damage Control,” Star-Ledger (Newark, NJ), March 5, 2003.
  2. 2. Giovanna Fabiano, “Dangers of Painkiller Highlighted by Fatality,” The Courier-News (Bridgewater, NJ), September 15, 2002, 22.
  3. 3. Marianne was divorced from her first husband. She also had raised a son from that marriage. He was nineteen when his sister died.
  4. 4. Fabiano, “Dangers of Painkiller Highlighted by Fatality.”
  5. 5. Marianne Skolek Perez, “You Messed with the Wrong Mother: One mother’s 17-year personal account exposing Purdue Pharma, maker of OxyContin in fueling the ‘manufactured’ opioid epidemic crippling the U.S.,” unpublished manuscript, cited here by courtesy of author. Bob Considine, “Readington Family Finds Justice, But Seeks More,” Courier-News (Bridgewater, NJ), June 4, 2007, A1, A4.
  6. 6. Marianne Skolek Perez, “You Messed with the Wrong Mother.”
  7. 7. Fabiano, “Dangers of Painkiller Highlighted by Fatality.”
  8. 8. Ibid.
  9. 9. The task force was based in Hunterdon County, NJ. See Marianne Skolek, “The Citizens of Ohio Deserve Better in Dealing with Your Epidemic of Drugs,” Salem-News (Salem, OR), March 18, 2010.
  10. 10. Marianne Skolek Perez, “You Messed with the Wrong Mother.”
  11. 11. Ibid.
  12. 12. Ibid.
  13. 13. Considine, “Readington Family Finds Justice.”
  14. 14. See, for example, “Griffith Hopes for Better Regulation of Painkiller,” Quad-City Times (Davenport, Iowa), November 11, 2002, 16.
  15. 15. Marianne Skolek, “Mom Vows to Fight Heroin Epidemic,” Courier-News (Bridgewater, NJ), March 31, 2001, A9.
  16. 16. Braun, “A Chilling Attempt at Damage Control.”
  17. 17. “Prescription Drugs: OxyContin Abuse and Diversion and Efforts to Address the Problem,” 2003.
  18. 18. It was founded in 1992 by former HEW secretary Joseph Califano Jr.
  19. 19. Marianne Skolek Perez, “You Messed with the Wrong Mother.”
  20. 20. Bob Braun, “A Chilling Attempt at Damage Control.”
  21. 21. Marianne Skolek Perez, “You Messed with the Wrong Mother.”
  22. 22. Ibid.
  23. 23. Giovanna Fabiano, “Woman Who Lost Daughter Targets Painkiller,” The Courier-News (Bridgewater, NJ), November 17, 2002, A6.
  24. 24. Braun, “A Chilling Attempt at Damage Control.”
  25. 25. Ibid.
  26. 26. Ibid.
  27. 27. Ibid.
  28. 28. Marianne Skolek Perez, “You Messed with the Wrong Mother.”
  29. 29. Ibid.
  30. 30. Hogen quoted in Bob Braun, “A Chilling Attempt at Damage Control” and “Inappropriate Comment,” Star-Ledger, March 18, 2003.
  31. 31. Considine, “Readington Family Finds Justice.”
  32. 32. Ibid.
  33. 33. Ibid.
  34. 34. Ibid.
  35. 35. Mark I. Pinsky, “Right Too Soon: The Orlando Sentinel On Opioid Epidemic,” Columbia Journalism Review, August 23, 2017.
  36. 36. One of the lead characters in the Sentinel series was described, for instance, as an “accidental addict” whose “idyllic life was ruined by OxyContin.” It turned out he had a federal conviction for conspiracy to distribute cocaine and a history of financial problems and domestic abuse allegations. See Dan Tracy and Jim Leusner, “Sentinel Finishes Report About OxyContin Articles,” The Orlando Sentinel, February 24, 2004. See also Pinsky, “Right Too Soon: The Orlando Sentinel On Opioid Epidemic.”
  37. 37. Ibid., Pinsky, “Right Too Soon: The Orlando Sentinel On Opioid Epidemic.”
  38. 38. “Orlando Sentinel Reporter Resigns, Two Editors Reassigned In OxyContin Story Fallout,” Orlando Business Journal, February 27, 2004.
  39. 39. T. Cicero et al., “Trends In Abuse Of OxyContin And Other Opioid Analgesics In The United States: 2002–2004,” J Pain 2005;6:662–72.
  40. 40. Author interview with former assistant production manager, February 2017. See also Cicero, “Trends In Abuse Of OxyContin And Other Opioid Analgesics In The United States.”
  41. 41. A. G. Lipman, “Pain as a human right: the 2004 Global Day Against Pain,” J Pain Palliat Care Pharmacother. 2005;19(3):85–100. The WHO declaration led to initiatives in some countries to address pain as a basic human right. See F. Brennan et al., “Pain Management: A Fundamental Human Right,” Anesth Analg. 2007 Jul;105(1):205–21. In 2010, six years after the WHO conference, at the International Pain Summit Of The International Association For The Study Of Pain in Montreal, the delegates adopted what became known as the “Declaration of Montreal.” It stated that “access to pain management is a fundamental human right” and urged that all nations provide “access to pain management without discrimination… on the basis of age, sex, gender, medical diagnosis, race or ethnicity, religion, culture, marital, civil or socioeconomic status, sexual orientation, and political or other opinion.” Declaration at https://www.iasp-pain.org/DeclarationofMontreal. See also International Pain Summit Of The International Association For The Study Of Pain, J Pain Palliat Care Pharmacother. 2011; 25(1):29–31.
  42. 42. Meier, “Origins of an Epidemic.”
  43. 43. Barry Meier, “Why Drug Company Executives Haven’t Really Seen Justice for Their Role in the Opioid Crisis,” Time, June 15, 2018.
  44. 44. Meyer, “Origins of an Epidemic.”
  45. 45. Chris McGreal, “Rudy Giuliani Won Deal For OxyContin Maker To Continue Sales Of Drug Behind Opioid Deaths,” Guardian, May 22, 2018.
  46. 46. Meier, “Origins of an Epidemic.”
  47. 47. Andrew Good, attorney for Dr. Goldenheim, interviewed in Meier, “Origins of an Epidemic.”
  48. 48. What Is a Serious Adverse Event? Reporting Serious Problems to the FDA, Safety Information and Adverse Event Reporting Program, FDA, at https://www.fda.gov/safety/reporting-serious-problems-fda/what-serious-adverse-event.
  49. 49. 2008-01-15 Board report, pgs. 16, 24, PDD8901733989, -997.
  50. 50. 2007-07-15 Board report, pgs. 33, 41, 54, Massachusetts v. Purdue document PWG000300817, -825, -838.
  51. 51. Barry Meier reported in 2018 “top Justice Department officials in the George W. Bush administration did not support the move [for the serious felony counts], said four lawyers who took part in those discussions or were briefed about them.” Meier, “Origins of an Epidemic.”
  52. 52. Author interview with retired criminal investigator, DOJ, June 2018.
  53. 53. Rannazzisi interviewed in Meier, “Origins of an Epidemic.”
  54. 54. 2006-10-25 Board minutes, Massachusetts v. Purdue document PKY183307486; see also 2006-10-25 agreement, PPLP004031281.
  55. 55. According to a complaint filed in January 2019 by the Massachusetts attorney general against Purdue and the eight living Sackler family members who had served as company directors. Bob Considine, “Readington Family Finds Justice, But Seeks More,” Courier-News, June 4, 2007, A4; Massachusetts v. Purdue 61.
  56. 56. 2007-05-09 Agreed Statement of Facts, paragraph 20, available at https://www.documentcloud.org/documents/279028-purdue-guilty-plea.
  57. 57. “The Purdue Frederick Company, Inc. And Top Executives Plead Guilty To Misbranding OxyContin; Will Pay Over $600 Million,” News Release from the United States Attorney’s Office, Western District of Virginia, May 10, 2007. The plea deal allowed the Purdue executives to plead guilty only to misdemeanors.
  58. 58. 2007-05-09 Plea Agreement; 2007-05-04 Associate General Counsel’s Certificate, Massachusetts v. Purdue document PDD1712900054.
  59. 59. 2007-05-15 Consent Judgment, Massachusetts v. Purdue document 07-1967(B).
  60. 60. 2007-05-09 Plea Agreement; 2007-05-04 Associate General Counsel’s Certificate, Massachusetts v. Purdue document PDD1712900054.
  61. 61. David Sackler quoted in Bethany McLean, “ ‘We Didn’t Cause The Crisis’: David Sackler Pleads His Case On The Opioid Epidemic,” Vanity Fair, August 2019.
  62. 62. Marianne Skolek Perez, “You Messed with the Wrong Mother.”
  63. 63. Considine, “Readington Family Finds Justice.”
  64. 64. “Evaluating the Propriety and Adequacy of the OxyContin Criminal Settlement,” Hearing before the Committee on the Judiciary, US Senate 110th Congress first session July 31, 2007 (US Government Printing Office, Washington: 2008).
  65. 65. Nagel quoted in Solomon, “The Importance of Being Rudy.”
  66. 66. Marianne Skolek Perez, “You Messed with the Wrong Mother.”
  67. 67. Testimony of Marianne Skolek, July 31, 2007, before the Senate Judiciary Committee, 110th Congress, first session, July 31, 2007.
  68. 68. Skolek became an investigative reporter for The Washington Standard and Salem-News and also has served as a consultant to plaintiff’s attorneys suing Purdue.

Chapter 48: Profits and Corpses

  1. 1. “Instead of reporting dangerous prescribers, or even directing sales reps to stop visiting them, the Sacklers chose to keep pushing opioids to whoever prescribed the most,” Massachusetts v. Purdue, 65, and para 112–53, 39–50.
  2. 2. The estimate for 2007 profits was presented in a July 2007 board meeting, and the figures on net sales were in a January 2008 board meeting. 2007-07-15 Board report, pg. 46, Massachusetts v. Purdue document PWG000300830 and 2008-01-15 Board report, pgs. 4, 22, 24, Massachusetts v. Purdue document PDD8901733977, -995, -997. Net sales are the sum of a company’s gross sales minus its returns, allowances, and discounts. Revenues reported on the income statement often represent net sales.
  3. 3. 2007-10-28 attachment to email from Edward Mahony, Massachusetts v. Purdue document PPLPC012000159170.
  4. 4. In 2008, the detail team had four hundred employees; in 2009, just under five hundred; 2010, six hundred; and in 2014, it surpassed seven hundred. That remained consistent until 2017 when Purdue thought the opioid market in the U.S. was saturated and the company was under increasing legal attack for its marketing of OxyContin. In February 2018 the detail squad was back to three hundred. In June 2018, Purdue laid off the remainder of its once high-flying detail team. 2007-07-15 Board report, pg. 46, Massachusetts v. Purdue document PWG000300830; 108 2007-07-15 Board report, pg. 52, Massachusetts v. Purdue document PWG000300836. See Nate Raymond, “OxyContin maker Purdue Pharma cuts remaining sales force,” Reuters, June 20, 2018.
  5. 5. “The Sacklers’ micromanagement was so intrusive that staff begged for relief,” Massachusetts v. Purdue, 63. Richard Sackler was often involved in minutiae and details of marketing OxyContin. The complaints of those who worked for him and had to constantly accede or fend off his directives are recounted in the emails and memos produced by Purdue later as part of litigation discovery. See 2012-02-07 email from Russell Gasdia, Massachusetts v. Purdue document PPLPC012000368569.
  6. 6. Barry Meier, “Ruling Is Upheld Against Executives Tied to OxyContin,” New York Times, December 15, 2010. The law firm was originally Washington, D.C.’s, Hogan & Hartson. Seven months before the 2010 ruling that rejected the appeal to overturn the ban on the three executives, Hogan & Hartson merged with London’s Lovells. The new firm had forty-nine offices worldwide. It represented Mylan Pharmaceuticals when that company was later named a defendant in the consolidated opioid litigation. See for instance Washington County, Virginia v. Purdue Pharma, L.P. et al, US District Court, Western District of Virginia, case number 1:18-cv-00046-EKD-PMS, filed 12/13/2018.
  7. 7. Russell Gasdia, Purdue’s vice president of sales and marketing, wrote to Michael Friedman, the CEO, about Richard Sackler: “Anything you can do to reduce the direct contact of Richard into the organization is appreciated.” 2012-02-07 email from Russell Gasdia, Massachusetts v. Purdue document PPLPC012000368569.
  8. 8. Massachusetts v. Purdue, para 227, 74.
  9. 9. Tom Loftus, “Tighter Rein on Controlled Drugs Urged,” Lexington Courier-Journal, September 19, 2001, 1, 5.
  10. 10. Remedica was an offshoot of a successful Cyprus drug company of the same name; Mortimer Sackler had come across it not long after it opened in the U.K. See “Brief History Of Remedica, A Leading Pharmaceutical Company In The European Union,” at https://www.remedica.eu/about-us/history/.
  11. 11. There were then 142 accredited colleges of pharmacy nationwide.
  12. 12. His “relevant financial relationships” were: Abbott, Adolor, Alpharma, Anesiva, Archimedes Pharma, Ascent Biomedical Ventures, Aveva Drug Delivery, Baxter, Bayer, BioDelivery Sciences, Biometrix, Biovail, Cephalon, CombinatroRx, Cytogel, Endo Pharmaceuticals, Fralex, Genentech, GlaxoSmithKline, Globomax, GPC Biotech, GW Pharmaceuticals, Janssen/Ortho-McNeil, Johnson & Johnson, King Pharmaceuticals, Ligand Pharmaceuticals, Merck, Nektar Therapeutics, Neuromed, Novartis, Organon, Painceptor, Pfizer, Pharmos, PPD, Progenics, Sarentis, United Biosource Corp, Valeant Pharmaceuticals North America, Wyeth, Xenome, and Xenon Pharmaceuticals.
  13. 13. “Screening and Stratification Methods to Minimize Opioid Abuse in Cancer Patients,” Lynn Webster, Advances in Pain Management, Volume 2, Number 1, 2008, 4–8.
  14. 14. Salt Lake County v. Purdue Pharma, et. al., Third District Court for Salt Lake County, State of Utah, paragraph 12.
  15. 15. CDC Guideline for Prescribing Opioids for Chronic Pain (March 18, 2016), available at https://www.cdc.gov/mmwr/volumes/65/rr/rr6501e1.htm. See also Jesse Hyde and Daphne Chen, “The Untold Story Of How Utah Doctors And Big Pharma Helped Drive The National Opioid Epidemic,” Deseret News, October 26, 2017.
  16. 16. In the few instances that Pain Management acknowledged there were “some endemic areas of high [opioid] abuse,” it put the blame on “inadequately trained clinicians trying to do the right thing…” In a widely disseminated “lead article” published a year after Purdue’s guilty plea, it explained, for instance, that the “myth [that] the mere exposure to an opioid leads to addiction” had given way to the “new thought [that] patients function well on opioids and rarely show addictive behavior.” The same was true for the myth that “opioids should be only used to treat severe pain.” It had given way to the idea that “treating pain early and aggressively leads to better quality of life” (the idea expressed often by Richard Sackler). See generally Ricardo Cruciani, “Treatment of Pain with Opioids and the Risk of Opioid Dependence: The Search for a Balance”; Steven D. Passik, “Appropriate Prescribing of Opioid and Associated Risk Minimization”; Lynn Webster, “Screening and Stratification Methods to Minimize Opioid Abuse in Cancer Patients,” all three articles in Advances in Pain Management, Volume 2, Number 1, 2008.
  17. 17. Salt Lake County v. Purdue Pharma, et. al., Third District Court for Salt Lake County, State of Utah, para 11–12, 56.
  18. 18. Ibid. See also Kristen Steward and Jennifer Dobner, “Utah Doctors Paid $25.8 Million By Drug Companies,” Salt Lake Tribune, March 12, 2013.
  19. 19. His conviction was upheld on appeal. The People of the State of New York, v. Ricardo Cruciani, Supreme Court, New York County, New York, 1734-2018, January 23, 2019.
  20. 20. Steward and Dobner, “Utah Doctors Paid $25.8 Million By Drug Companies.”
  21. 21. Salt Lake County v. Purdue Pharma, et. al., Third District Court for Salt Lake County, State of Utah, para 13.
  22. 22. 2008-04-18 email and attached memo from Richard Sackler, Massachusetts v. Purdue document PDD9316300629-631.
  23. 23. Chart titled “The Sacklers Paid Themselves Billions of Dollars,” AGO graphic based on Purdue’s internal Board documents, covering from April 2008 through 2016. Massachusetts v. Purdue, board minutes cited in note 154, 79.
  24. 24. Jared S. Hopkins, “OxyContin Made The Sacklers Rich. Now It’s Tearing Them Apart,” Wall Street Journal, July 13, 2019.
  25. 25. 2008-10-15 Board report, pgs. 19, 24, 28, Massachusetts v. Purdue document PDD9316101020, -025, 029.
  26. 26. 2009-03-05 Board minutes, Massachusetts v. Purdue document PKY183212703-711.
  27. 27. 2009-07-30 Board report, pg. 16, Massachusetts v. Purdue document PPLPC012000233246; 2009-06-26 Board minutes, Massachusetts v. Purdue document PKY183212742.
  28. 28. David Sackler did not become a Purdue director until 2012. McLean, “ ‘We Didn’t Cause The Crisis.’ ”
  29. 29. “Numerous studies have shown that the most common route by which drugs of abuse are administered is ingestion, followed by snorting and injection, with the percentage of those ingesting the drugs ranging from 64 percent to 97 percent, depending on the population studied. Certain medications are more likely than others to be snorted or injected.” “Many Doctors Misunderstand Key Facets of Opioid Abuse.” Survey by Bloomberg School of Public Health, Johns Hopkins, June 23, 2015.
  30. 30. 2008-02-22 email from John Stewart, Massachusetts v. Purdue document PPLPC012000172201.
  31. 31. Introducing Opioids with Abuse-Deterrent Properties (OADP), Massachusetts v. Purdue document PVT0024614.
  32. 32. Three Purdue-sponsored articles ran in The Atlantic. The company’s campaign built around the tamper-resistant formulations ran in medical journals, medical education courses, and on the website In the Face of Pain. Some of the Purdue publications included: Providing Relief, Preventing Abuse: The Resource Guide for People with Pain; Exit Wounds; Opioid Prescribing: Clinical Tools and Risk Management; Strategies For Responsible Opioid Prescribing; and Clinical Issues in Opioid Prescribing. See Introducing Opioids with Abuse-Deterrent Properties (OADP), PVT0024614.
  33. 33. 2010-07-22 questions during Board meeting, Massachusetts v. Purdue document PPLPC012000283167.
  34. 34. 752,417 visits in 2012, and 744,777 visits in 2013. See the following Purdue board of director meeting reports, all documents in Massachusetts v. Purdue: 2010-02-01 Board report, 23, PPLPC012000252797; 2011-05-02 Board report, 3, PPLPC012000322428; 2012-04-30 Board report, 3, PPLPC012000374793; 2013-05-13 Board report, 7, PPLP004367546.
  35. 35. Richard Sackler complained, for instance, that they were slightly under their quotas for doctor visits and did not forcefully present the benefits of opioid pain treatment. He was particularly incensed that managers had allowed many visits to “non-high potential prescribers.” 2011-06-16 email from Richard Sackler, Massachusetts v. Purdue document PPLPC012000329706.
  36. 36. See the following Purdue board of director meeting reports, all documents in Massachusetts v. Purdue: 2010-02-04 Board minutes, PKY183212818-820; 2010-04-01 Board minutes, PKY183212829; 2010-12-02 Board minutes, PKY183212869-70. In 2010-07-27 Board report, pg. 18, PWG000422494, the staff reported to the Sacklers “that Purdue had paid their family $389,000,000 in the first six months of 2010,” Massachusetts v. Purdue, para 317, 107.
  37. 37. 2010-06-24 Purdue Pharma 2010 10-Year Plan, 1-15, Key Assumptions 6, Massachusetts v. Purdue document PPLPC012000277155-169, 217.
  38. 38. Walters, “America’s Opioid Crisis: How Prescription Drugs Sparked A National Trauma.”
  39. 39. Massachusetts v. Purdue, para 335–37, 113.
  40. 40. Purdue contended its promotion of Oxy was “consistent with FDA-approved product labeling. And doctors at all times have had access to FDA-approved label, which is crystal clear about the risk of abuse and addiction.” Massachusetts v. Purdue, Purdue’s Memorandum Of Law In Support Of Its Motion To Dismiss Amended Complaint, 20–21.
  41. 41. Ryan, Girion, and Glover, “More than 1 Million OxyContin Pills Ended up in the Hands of Criminals and Addicts.”
  42. 42. According to the complaint filed in Massachusetts v. Purdue, the attorney general charged, “The Sacklers knew these employees were aware of misconduct because they had directed it,” para 334, 112. See also 2011-01-20 Board minutes, Massachusetts v. Purdue document PKY183212882-892. And Ryan, Girion, and Glover, “More than 1 Million OxyContin Pills Ended up in the Hands of Criminals and Addicts.”
  43. 43. Joseph Rannazzisi quoted in Ryan, Girion, and Glover, “More than 1 Million OxyContin Pills Ended up in the Hands of Criminals and Addicts.”
  44. 44. Ibid.
  45. 45. Phil Strassburger quoted in Ibid.
  46. 46. Rannazzisi was featured as a whistleblower in a 2017 joint investigation by 60 Minutes and The Washington Post. “Ex-DEA agent: Opioid crisis fueled by drug industry and Congress,” CBS 60 Minutes, October 15, 2017. See also Scott Higham and Lenny Bernstein, “Who is Joe Rannazzisi: The DEA man who fought the drug companies and lost,” Washington Post, October 15, 2007.
  47. 47. “Ex-DEA agent: Opioid crisis fueled by drug industry and Congress”; Nate Raymond, “Mckesson To Pay $37 Million To Resolve West Virginia Opioid Lawsuit,” Reuters, May 2, 2019. See Sara Randazzo, “Last-Minute Opioid Deal Could Open Door to Bigger Settlement,” Wall Street Journal, October 21, 2019.
  48. 48. Matthew Herper, “David Graham On The Vioxx Verdict,” Forbes, August 19, 2005.
  49. 49. Derek Lowe, “500,000 Excess Deaths From Vioxx?,” In the Pipeline (AAAS), May 30, 2012.
  50. 50. Since Vioxx was not a Controlled Substances Act scheduled drug, Merck was spared parallel investigations by the DEA and FBI, and criminal probes by state attorneys general and federal prosecutors. Because of Purdue’s great success with OxyContin, the Sacklers believed that politicians and law enforcement had unfairly put most of the blame for the abuse and addiction epidemic on the company. See differences with a drug not a controlled substance in “Merck Settles Vioxx Claims for $4.85 Billion,” Reuters, November 9, 2007.
  51. 51. “Ex-DEA Agent: Opioid Crisis Fueled By Drug Industry And Congress,” CBS 60 Minutes, October 15, 2017.
  52. 52. Author interview with former attorney for Purdue, January 2019.
  53. 53. Jef Feeley, “J&J Labeled ‘Kingpin’ of US Opioid Drug Epidemic by Oklahoma,” Bloomberg, March 12, 2019; Jan Hoffman, “Johnson & Johnson Ordered to Pay $572 Million in Landmark Opioid Trial,” New York Times, August 26, 2019, 1; Colin Dwyer and Jackie Fortier, “Oklahoma Judge Shaves $107 Million Off Opioid Decision Against Johnson & Johnson,” NPR, “All Things Considered,” November 15, 2019.
  54. 54. 2011-11-09 Board report, pg. 26, Massachusetts v. Purdue document PWG000419328.
  55. 55. 2012-04-20 email from David Rosen, Massachusetts v. Purdue document PPLPC012000374532.
  56. 56. 2013-07-05 email from Edward Mahony, Massachusetts v. Purdue document PPLPC012000431312-313.
  57. 57. Paul D. Thacker, “Senators Hatch And Wyden: Do Your Jobs And Release The Sealed Opioids Report,” Stat, June 27, 2016.
  58. 58. Charles Ornstein and Tracy Weber, “The Champion of Painkillers,” ProPublica, December 23, 2011.
  59. 59. Charles Ornstein and Tracy Weber, “American Pain Foundation Shuts Down as Senators Launch Investigation of Prescription Narcotics,” ProPublica, May 8, 2012.
  60. 60. Thacker, “Senators Hatch And Wyden: Do Your Jobs And Release The Sealed Opioids Report.” See also Jason Smith, “OxyContin, Heroin, and the Sackler-Sinaloa Connection,” Part I: The Come Up, September 25, 2015, 20, initially published online on therealedition.com but not available as of 2019. Smith has written about that article, “Of anything I’ve ever written, I may be most proud of this piece,” Medium.com, September 10, 2015.
  61. 61. 2012-04-20 email from David Rosen, Massachusetts v. Purdue document PPLPC012000374532.
  62. 62. The FDA had approved generic OxyContin in 2003 and Purdue had agreed for several years to limited competition, but the competitors had difficulties duplicating the extended release coating. There were many generic oxycodone tablets on the market, but they were all instant release, short relief. FDA Actions on OxyContin Products, 4/16/2013, at https://www.fda.gov/drugs/information-drug-class/fda-actions-oxycontin-products-4162013.
  63. 63. Nancy Shute and Audrey Carlsen, “FDA’s Rejection of Generic OxyContin May Have Side Effects,” NPR News, April 18, 2003.
  64. 64. The arguments before the FDA had made for some odd allies. In opposing any generics Purdue was joined by some state attorneys general who decided it was better to allow Purdue to keep prices high and feed its profits than to allow cheap generics to flood the market and almost certainly fuel the illicit street trade. McLean, “ ‘We Didn’t Cause The Crisis’ ”; See also Barry Meier, “F.D.A. Bars Generic OxyContin,” New York Times, April 16, 2013.
  65. 65. Shute and Carlsen, “FDA’s Rejection of Generic OxyContin May Have Side Effects.”
  66. 66. Meier, “F.D.A. Bars Generic OxyContin.”
  67. 67. Ibid.
  68. 68. 2013-08-08 Identifying Granular Growth Opportunities for OxyContin: Addendum to July 18th and August 5th Updates, Massachusetts v. Purdue document PPLP004409892.
  69. 69. 2014-01-30 memo from Edward Mahony, Massachusetts v. Purdue document PPLPC020000756513.
  70. 70. 2013-08-08 Identifying Granular Growth Opportunities for OxyContin: Addendum to July 18th and August 5th Updates, Massachusetts v. Purdue document PPLP004409896-897.
  71. 71. The exact amount was $399,920,000. 2013-11-01 Board report, pgs. 3, 6, Massachusetts v. Purdue document PPLPC002000186913, -916.
  72. 72. 2013-12-04 email from David Rosen, Massachusetts v. Purdue document PPLPC012000454676; 500 2014-01-03 email from Burt Rosen, Massachusetts v. Purdue document PPLPC020000748356 (“I spoke to Richard just before the year end and raised concerns over our internal documents.”).
  73. 73. “I think my dad’s vision was that I would replace him at some point,” said David Sackler, “as his health continued to decline.” McLean, “ ‘We Didn’t Cause The Crisis.’ ”
  74. 74. Alex Morrell, “The OxyContin Clan: The $14 Billion Newcomer to Forbes 2015 List of Richest U.S. Families,” Forbes, July 1, 2015.
  75. 75. Ibid.
  76. 76. McLean, “ ‘We Didn’t Cause The Crisis.’ ”

Chapter 49: Gaming the System

  1. 1. See Benjamin M. Craig and Scott A. Strassels, “Out-of-pocket Prices of Opioid Analgesics in the United States, 1999–2004,” Pain Med. 2010;11(2):240–47.
  2. 2. Kesselheim, “The High Cost of Prescription Drugs in the United States: Origins and Prospects for Reform.”
  3. 3. “Pain Management and the Opioid Epidemic: Balancing Societal and Individual Benefits and Risks of Prescription Opioid Use,” National Academies of Sciences, Engineering, and Medicine; Health and Medicine Division; Board on Health Sciences Policy; Committee on Pain Management and Regulatory Strategies to Address Prescription Opioid Abuse; (Phillips JK, Ford MA, Bonnie RJ, editors) (Washington, D.C.: National Academies Press, July 2017).
  4. 4. Dan Mangan, “US Often Pays Much More Than Other Countries For Prescription Drugs, Surgery,” CNBC, July 19, 2016.
  5. 5. Ben Hirschler, “How the U.S. Pays 3 Times More for Drugs,” Scientific American, October 13, 2015.
  6. 6. Kefauver, In a Few Hands, 6.
  7. 7. Dan Mangan and Anita Balakrishnan, “Mylan CEO Bresch: ‘No One’s More Frustrated Than Me’ About Epipen Price Furor,” CNBC, August 25, 2016.
  8. 8. Michael A. Carrier and Carl J. Minniti III, “The Untold Epipen Story: How Mylan Hiked Prices By Blocking Rivals,” Cornell Law Review, Vol. 102:53, 2017, 53–72.
  9. 9. Cynthia Koons and Robert Langreth, “How Marketing Turned the EpiPen into a Billion-Dollar Business,” Businessweek, September 23, 2015.
  10. 10. As with most drug company settlements, it admitted no guilt. Ibid. See also David Lazarus, “Always look on the bright side of life, says CEO who raised EpiPen price by more than 400%,” Los Angeles Times, June 5, 2018.
  11. 11. A snapshot of the industry in 2014 was skewed by the sale of just four prescription drugs that had been approved recently to treat hepatitis C. Gilead Sciences had Harvoni and Sovaldi, AbbVie sold Viekira Pak, and Janssen had Olysio. If their combined 2014 sales of $14 billion were removed from the $265 billion prescription market, the industry’s total growth rate would have been 7.6 percent instead of 12.2 percent. Even the lower rate would have been nearly triple the annual inflation rate. See Charles Roehrig, “The Impact Of New Hepatitis C Drugs On National Health Spending,” Health Affairs, December 7, 2015.
  12. 12. Helene L. Lipton et al., “Pharmacy Benefit Management Companies: Dimensions of Performance,” Annual Review of Public Health 1999 20:1, 361–401.
  13. 13. Vagelos and Galambos, Medicine, Science and Merck, 202–3.
  14. 14. C. Woolsey, “Any adverse effects? Drug industry mergers invite more scrutiny of plan costs,” Business Insurance, July 18, 1994, 1.
  15. 15. Some examples include the purchase of Caremark by MedPartners, a physician practice management firm, for $2.5 billion. The following year, RxAmerica, a PBM owned by American Stores, a national retail pharmacy, merged with Integrated Health Concepts, a PBM owned by Long’s Drugstores. PCS Health Systems acquired Managed Prescription Services, Inc., a PBM owned by Humana Health. Also in 1997 the national hospital chain Columbia HCA bought Value Health, Inc., the parent of ValueRx, for $1.1 billion. A year later, Columbia sold ValueRx to Express Scripts, an independent PBM, for just under half a billion. Lipton et al., “Pharmacy Benefit Management Companies.”
  16. 16. Medicare Prescription, Drug, Improvement, and Modernization Act of 2003, 108th Congress, Public Law 108-173.
  17. 17. Sidney Lupkin, “5 Reasons Prescription Drug Prices Are So High in the U.S.,” Money, Kaiser Health News, August 23, 2016.
  18. 18. “Fact Sheet: How Much Money Could Medicare Save By Negotiating Prescription Drug Prices?,” Committee for a Responsible Budget, April 11, 2016.
  19. 19. Brittany Hoffman-Eubanks, “The Role of Pharmacy Benefit Managers in American Health Care: Pharmacy Concerns and Perspectives: Part 1,” Pharmacy Times, November 14, 2017.
  20. 20. “While PBMs Market Themselves As Being Well-Positioned To Bring Savings To Plans And Consumers, A Lack Of Transparency In Their Practices Enables Them To Wield Their Power To Increase Their Profits, Often At The Expense Of The Consumer,” PBM Watch, Winter 2018.
  21. 21. “CMS Updates Drug Dashboards with Prescription Drug Pricing and Spending Data,” Centers for Medicare & Medicaid Services, March 14, 2019, and Jacqueline Renfrow, “Kentucky Officials: Pbms Earned $123M Last Year Through Spread Pricing In State’s Medicaid Program,” Fierce Healthcare, February 25, 2019; Susan Jaffe, “No More Secrets: Congress Bans Pharmacist ‘Gag Orders’ on Drug Prices,” Kaiser Health News, October 10, 2018.
  22. 22. Rabah Kamal et al., “What Are the Recent and Forecasted Trends in Prescription Drug Spending,” Health System Tracker, Kaiser Family Foundation, 2018, 21.
  23. 23. “An Overview of the Medicare Part D Prescription Drug Benefit,” Kaiser Family Foundation, October 12, 2018.
  24. 24. Veterans Affairs has the discretion to exclude some of the budget-busting drugs from its formulary.
  25. 25. “Prices for Brand-Name Drugs Under Selected Federal Programs,” A CBO Paper, Congressional Budget Office, June 2005.
  26. 26. Katherine Young et al., “Medicaid’s Most Costly Outpatient Drugs,” Kaiser Family Foundation, July 15, 2016; see also “Medicaid Spending for Prescription Drugs,” Report of Medicaid and CHIP Payment and Access Commission, January 2016.
  27. 27. “An Overview of the Medicare Part D Prescription Drug Benefit.”
  28. 28. The federal government pays for drugs under Social Security Disability, Veterans Affairs, TRICARE, the civilian health program of the U.S. military and State Department, and FEHB, which provides civilian health coverage for all other divisions in the federal government. Kesselheim, “The High Cost of Prescription Drugs in the United States,” 859.
  29. 29. M.R. Trusheim et al., “Stratified Medicine: Strategic and Economic Implications of Combining Drugs and Clinical Biomarkers,” Nature Reviews: Drug Discovery 6, no. 4 (2007): 287–93.
  30. 30. David Dayen, “The Hidden Monopolies That Raise Drug Prices,” American Prospect, March 28, 2017.
  31. 31. Separate contracts mean that insurance companies cannot determine what percentage of what they pay to a PBM for a drug is reimbursed to the pharmacist at the bottom of the pharma distribution chain. Insurers also have no idea of what the PBM paid for a drug; the pharma company might have discounted the list price or effectively reduced it by offering a rebate. Since pharmacists do not know what insurance companies paid to the PBMs for the drug, when they finally receive their payment there is no way to tell whether the PBM passed along most of the insurance reimbursement or retained an outsized share as its profit.
  32. 32. It is not even certain whether PBMs keep all profits from spread pricing or share some with private insurers in order to get them to issue the highest reimbursement rates without asking any questions.
  33. 33. Robert Langreth et al., “The Secret Drug Pricing System Middlemen Use to Rake in Millions,” Bloomberg, September 11, 2018.
  34. 34. “Study shows PBMs skimming big markups,” National Community Pharmacists Association, January 25, 2019.
  35. 35. Review of costs from 1987 to 2014, CMS Updates Drug Dashboards with Prescription Drug Pricing and Spending Data, Centers for Medicare & Medicaid Services, March 14, 2019.
  36. 36. Ibid.
  37. 37. “Feeling The Pain Of Rising Drug Prices? Blame The Middle Man,” CBS News, September 20, 2018.
  38. 38. Hirschler, “How the U.S. Pays 3 Times More for Drugs.”
  39. 39. Testimony of Heather Bresch, “Reviewing The Rising Price Of Epipens,” Hearing Before The Committee On Oversight And Government Reform House Of Representatives, 114th Congress, second session, September 21, 2016.
  40. 40. Deposition of Richard Sackler, 41.
  41. 41. Listed are the three hypertension drugs, year of first approval in the U.S., and the price increase from 2008 to 2015: isoproterenol (1947), 2,500 percent; nitroprusside (1955), 1,700 percent; digoxin (1949), 687 percent. JAMA, 860—n 23; see “Escalating Prices Of Generic Drugs In The US,” Generics and Biosimilars Initiative, March 15, 2019.
  42. 42. Hirschler, “How the U.S. Pays 3 Times More for Drugs.”
  43. 43. I. Papanicolas et al., “Health Care Spending in the United States and Other High-Income Countries.” JAMA, 319(10), 2018:1024–39.
  44. 44. Nicholas Florko, “Federal judge blocks Trump rule to require drug prices in TV ads,” STAT, July 8, 2019.
  45. 45. “Sweeping Lawsuit Accuses Top Generic Drug Companies, Executives of Fixing Prices,” CBS News, 60 Minutes, May 12, 2019.
  46. 46. Nicholas Florko and Lev Facher, “Pelosi’s Drug Pricing Plan Is More Aggressive than Expected,” STAT, September 9, 2019. See also Johnathan Gardner, “Medicare Would Negotiate Prices for 250 Drugs Under House Democrats’ Plan,” BioPharma Dive, September 10, 2019; Shraddha Chakradhar, “Battle Set in Washington Over Competing Drug Price Bills,” STAT, December 9, 2019; “Health Care: See Where the 2020 Democrats Stand,” Tracking the Issues in the 2020 Election, Special Series, NPR, September 10, 2019. See also Jay Hancock, “Talk About Déjà Vu: Senators Set To Re-Enact Drug Price Hearing Of 60 Years Ago,” Kaiser Health News, February 22, 2019.

Chapter 50: Billion-Dollar Orphans

  1. 1. The per capita health care costs were compared in the U.S. and Australia, Canada, France, Germany, the Netherlands, Norway, Sweden, Switzerland, and the U.K. The Swiss came in second, at $783 per person, and Sweden was the lowest at $351. Austin Frakt, “Something Happened to U.S. Drug Costs in the 1990s,” New York Times, November 12, 2018.
  2. 2. Sarah Jane Tribble and Sydney Lupkin, “Drugs For Rare Diseases Have Become Uncommonly Rich Monopolies,” NPR, Morning Edition, January 17, 2017.
  3. 3. Paul Melmeyer, Director of Federal Policy for the National Organization of Rare Disorders, quoted in Malorye A. Branca, “How the Orphan Drug Act Changed the Development Landscape,” BioPharma Dive, April 10, 2017; see also Sarah Jane Tribble and Sydney Lupkin, “How Drugmakers Manipulate Orphan Drug Rules to Create Prized Monopolies,” California Healthline, January 18, 2017.
  4. 4. Kaiser Health Report 2017. See also Stephen Barlas, “The Push for Additional Orphan Drugs,” P&T Community, 2016;41(11): 667.
  5. 5. FDA’s Orphan Drug Database, Kaiser Health News, Tribble and Lupkin, “How Drugmakers Manipulate Orphan Drug Rules to Create Prized Monopolies.”
  6. 6. In 2015, orphan drugs accounted for 47 percent of FDA approved medicines, up from 29 percent in 2010. In 2016, nine more orphans were approved, 40 percent of the total.
  7. 7. Andrew Pollack, “AstraZeneca Pushes to Protect Crestor From Generic Competition,” New York Times, June 27, 2016.
  8. 8. The seven orphan drugs in the top ten were Humira (2), Enbrel (3), Remicade (5), and 7 through 10 were Rituxan, Neulasta, Revlimid, and Copaxone.
  9. 9. Nigel Walker, “Where Do Orphan Drugs Go From Here?,” Pharma’s Almanac, May 24, 2019.
  10. 10. Michael G. Daniel et al., “The Orphan Drug Act: Restoring the Mission to Rare Diseases,” American Journal of Clinical Oncology: April 2016, Volume 39, Issue 2, 210–13.
  11. 11. “Orphan Products: Hope for People With Rare Diseases,” Drug Information for Consumers, FDA, March 1, 2018.
  12. 12. Coté quoted, and Coté Orphan website, in Tribble and Lupkin, “Drugs For Rare Diseases Have Become Uncommonly Rich Monopolies.”
  13. 13. Ibid.
  14. 14. “I was responsible for the administration of the US Orphan Drug Act—the first in the world,” Haffner says on her LinkedIn profile. https://www.linkedin.com/in/marlene-haffner-299b3b22/.
  15. 15. In 2013, Haffner opened a new LLC with Lisa Beth Ferstenberg, the medical director of Sequella, a small biotech.
  16. 16. Subsequently, the FDA has given Genentech and Biogen separate orphan status on even smaller subclasses of follicular B-cell non-Hodgkin’s lymphoma: diffuse large B-cell lymphoma and lymphocytic leukemia.
  17. 17. MedStats and Kiplinger (2017); Megan Brooks, “Cancer Drugs Dominate Top 10 Best-Selling Drugs in 2018,” Medscape, March 19, 2019.
  18. 18. Bill Saporito, “Hospitals Furious at Cancer-Drug Price Hikes,” Time, October 27, 2014.
  19. 19. Measuring the number of people affected with FH has proven difficult and is the subject of academic studies that have attempted to standardize the measurements and factors. Leo Akioyamen et al., “Estimating The Prevalence Of Heterozygous Familial Hypercholesterolaemia: A Systematic Review And Meta-Analysis,” BMJ vol. 7, no. 9, September 1, 2017. The FH Foundation provides this information: “Worldwide, 1 in every 200–500 people has FH. Certain populations display a higher prevalence of FH, such as the French Canadian, Ashkenazi Jew, Lebanese, and South African Afrikaner populations. In these populations, 1 in every 67 people are found to have FH.” Marie Louise Brumit, “How Common Is Familial Hypercholesterolemia?” News & Blogs, The FH Foundation, December 24, 2014.
  20. 20. Anne C. Goldberg and Samuel S. Gidding, “Knowing the Prevalence of Familial Hypercholesterolemia Matters,” Circulation, March 15, 2016, vol 133, no. 11.
  21. 21. The more common FH includes all instances in which a child inherits only one dominant gene from one parent. That is classified as Heterozygous familial hypercholesterolemia, HeFH. See “Repatha (Evolocumab) for the Treatment of Heterozygous and Homozygous Familial Hypercholesterolemia,” Clinical Trials Arena, at https://www.clinicaltrialsarena.com/projects/repatha-evolocumab-treatment-heterozygous-homozygous-familial-hypercholesterolemia.
  22. 22. Some researchers who worked on the development of Repatha were surprised that Amgen applied for orphan status. Steven Nissen, the chairman of Cardiovascular Medicine at the Cleveland Clinic, had run one of the largest clinical trials. “It’s certainly not considered by any of us [researchers] to be an orphan drug.” Nissen quoted in Sarah Jane Tribble and Sydney Lupkin, “Drugs For Rare Diseases Have Become Uncommonly Rich Monopolies,” NPR, Morning Edition, January 17, 2017.
  23. 23. Anthony Wang et al., “Systematic Review of Low-Density Lipoprotein Cholesterol Apheresis for the Treatment of Familial Hypercholesterolemia,” Journal of the American Heart Association vol. 5, no. 7, July 6, 2016,
  24. 24. Pediatric Device Consortia Grants Program, Section: “Developing Products for Rare Diseases & Conditions,” FDA, September 20, 2018.
  25. 25. “To Accelerate The Discovery, Development, And Delivery Of 21st Century Cures, And For Other Purposes” (this Act may be cited as the “21st Century Cures Act”), H.R.24, 114th Congress, second session, January 4, 2016.
  26. 26. Pollack, “AstraZeneca Pushes to Protect Crestor From Generic Competition.”
  27. 27. Ibid.
  28. 28. “Csrxp Statement On Astrazeneca Seeking ‘Orphan Drug’ Designation For Widely-Used Cholesterol Drug Crestor,” The Campaign for Sustainable Rx Pricing, September 2016.
  29. 29. Crestor’s patent now expires on May 27, 2023, unless AstraZeneca can extend it even further by finding another rare disease that Crestor could treat.
  30. 30. It was in December 1999 for the “Treatment of patients with pancreatic cancer that overexpress p185HER2, a monoclonal antibody,” and in December 2009 for “Treatment of HER2-overexpressing advanced adenocarcinoma of the stomach, including gastroesophageal junction.”
  31. 31. Christopher T. Chen and Aaron S. Kesselheim, “Journey of Generic Imatinib: A Case Study in Oncology Drug Pricing,” Journal of Oncology Practice 2017 13:6, 352–55.
  32. 32. Gleevec’s patent included a pediatric exclusivity extension, an additional six months of protection for drug companies that conduct a clinical trial in pediatric patients. It also got a patent term restoration of 586 days.
  33. 33. Chen and Kesselheim, “Journey of Generic Imatinib.”
  34. 34. See Orphan Designations under Generic Name Imatinib and Imatinib Mesylate, FDA, ranging from January 21, 2001 to December 19, 2005.
  35. 35. Abbott got Humira when it bought BASF Pharma. See Dyke Hendrickson, “Birth Of A Blockbuster: Abbott Mounts Humira’s Marketing Campaign,” Boston Business Journal, October 20, 2003.
  36. 36. Ibid.
  37. 37. Lipitor is #1 by a healthy margin, more than $150 billion in sales.
  38. 38. Two approvals for juvenile rheumatoid arthritis (2005); pediatric Crohn’s disease (2006); pediatric ulcerative colitis (2011); chronic noninfectious anterior uveitis (2014); moderate to severe hidradenitis suppurativa (2015); and severe hidradenitis suppurativa (2015). US FDA Orphan Drug Designations and Approvals.
  39. 39. “Humira: The Highs And Lows Of The World’s Best-Selling Drug,” Pharmaceutical Technology, September 5, 2018.
  40. 40. Allergan was spun off from SmithKline Beecham and was looking for ways to build a business beyond its mainstay allergy eye and nose drops and eye care products. Between 1986 and 1991, there had been five double-blind, placebo-controlled studies of botulinum toxin protein on patients with a rare disorder, cervical dystonia. The trials, sponsored by academic institutes and the NIH, had produced promising results. Marius Nicolae Popescu et al., “Injecting Botulinum Toxin Into The Treatment Of Blepharospasm,” Romanian Journal of Ophthalmology 62(2), April–June 2018, 162–65. See also Leslie Berkman, “Shareholders OK SmithKline Deal Spinning Off Beckman, Allergan,” Los Angeles Times, July 27, 1989.
  41. 41. “Allergan Agrees to Plead Guilty and Pay $600 Million to Resolve Allegations of Off-Label Promotion of Botox,” Press Release, Department of Justice, September 1, 2010.
  42. 42. Ibid.
  43. 43. It took until 2013 for the FDA to approve Botox for the mass-market treatment of lateral canthal lines, so-called crow’s-feet wrinkles near the eyes.
  44. 44. When it comes to treating upper limb spasticity, the FDA approved muscles and doses are biceps brachii (100 units to 200 units divided in four sites); flexor carpi radialis (12.5 units to 50 units in 1 site); flexor carpi ulnaris (12.5 units to 50 units in 1 site); flexor digitorum profundus (30 units to 50 units in 1 site); flexor digitorum superficialis (30 units to 50 units in 1 site); adductor pollicis (20 units in 1 site); and flexor pollicis longus (20 units in 1 site).
  45. 45. “Botox Approval History, Treatment for: Hyperhidrosis, Cervical Dystonia, Urinary Incontinence, Migraine Prevention, Upper Limb Spasticity, Lower Limb Spasticity, Blepharospasm, Strabismus” at https://www.drugs.com/history/botox.html.
  46. 46. They include corticobasal degeneration, a progressive neurological disorder marked by cell loss and deterioration of areas of the brain; essential tremor, an involuntary, rhythmic spasm of the hands; Frey syndrome, affecting ability to form saliva; gastroparesis, slow emptying of food from the stomach; hereditary leiomyomatosis and renal cell carcinoma, smooth muscle growths on the uterus and kidneys; hereditary spastic paraplegia, difficulty walking; laryngeal dystonia, chronic voice disorder caused by uncontrolled spasms of the larynx muscles; multiple system atrophy, which causes Parkinson’s-type symptoms; necrotizing fasciitis, a decaying infection of the fascia; Niemann-Pick disease Type C, an inability of the body to transport cholesterol; pantothenate kinase-associated neurodegeneration, a neurological movement disorder; primary orthostatic tremor, a rapid uncontrolled trembling in the leg when standing. See Rare Disease Database, National Organziation for Rare Disorders. See also Antigone S Papavasiliou et al., “Safety of botulinum toxin A in children and adolescents with cerebral palsy in a pragmatic setting,” Toxins vol. 5(3), March 12, 2013, 524–36.
  47. 47. When the Orphan Drug Act passed in 1983, it had been less than a year since the FDA approved Genentech’s Humulin, the first ever genetically engineered drug. Biotechnology since then has changed the world of orphan drugs.
  48. 48. “Atypical hemolytic-uremic syndrome,” Genetics Home Reference, U.S. National Library of Medicine, October 29, 2019.
  49. 49. Chuck Dinerstein, “Why Is Soliris The Most Expensive Drug In The US?,” American Council on Science and Health, May 27, 2017.
  50. 50. The orphan illness was biallelic RPE65-mediated inherited retinal disease.
  51. 51. The drug was only approved for children under the age of two. See Joshua Cohen, “At Over $2 Million Zolgensma Is The World’s Most Expensive Therapy, Yet Relatively Cost-Effective,” Forbes, June 5, 2019; Hannah Kuchler, “Novartis Wins Approval For World’s Most Expensive Drug,” Financial Times, May 24, 2019.
  52. 52. Berkeley Lovelace Jr., and Angelica LaVito, “FDA Approves Novartis’ $2.1 Million Gene Therapy—Making It The World’s Most Expensive Drug,” CNBC, May 24, 2019.
  53. 53. Robert Weisman, “New Genzyme Pill Will Cost Patients $310,250 A Year,” Boston Globe, September 2, 2014.
  54. 54. Tim Coté, the ex-FDA orphan drug director and founder of Coté Orphan, told NPR when asked about Kalydeco’s price: “The price point is justified because actually it has a dramatic effect on the children. Dead children… people are willing to pay a lot to prevent that. And that’s a real good thing that we have this drug. OK?” Coté quoted in Tribble and Lupkin, “Drugs For Rare Diseases Have Become Uncommonly Rich Monopolies.”
  55. 55. John Farber, a specialist researcher on cystic fibrosis, organized the petition. For more on the pricing controversy see Ed Silverman, “Vertex Faces More Pressure Over Pricing, But One Analyst Does Not Expect Any Movement,” Stat, January 28, 2019.
  56. 56. Megan Thielking, “NIH Funding Contributed To 210 Approved Drugs In Recent Years, Study Says,” Stat, February 12, 2018.
  57. 57. Mariana Mazzucato, “How Taxpayers Prop Up Big Pharma, And How To Cap That,” Los Angeles Times, October 27, 2015.
  58. 58. On the few occasions in which the FDA tried to limit some of the orphan abuses, it was not successful. Depomed, a small California pharmaceutical company, tried in 2010 to get orphan approval for “management of postherpetic neuralgia” (a complication of shingles). Depomed’s once-a-day pill was based on gabapentin, the same active ingredient in Pfizer’s Neurontin. The FDA approved Depomed’s pill but denied it the seven-year exclusive selling period since there was no proof its product was any better than others. Depomed sued the FDA, contending the Orphan Drug Act did not require a drug to be better, only effective. The courts agreed and the drug, Gralise, became one of the small company’s best-selling drugs at $100 million annually. Tribble and Lupkin, “Drugs For Rare Diseases Have Become Uncommonly Rich Monopolies”; Monica Holmberg, “New FDA Actions: Depomed Inc’s Gralise,” Pharmacy Times, 2012-01-09 09:45:51.
  59. 59. Pollack, “Questcor Finds Profits, at $28,000 a Vial.”
  60. 60. Michael Gibney, “H.P. Acthar Gel–Questcor/Mallinckrodt,” FiercePharma, 2019.
  61. 61. Pollack, “Questcor Finds Profits, at $28,000 a Vial.”
  62. 62. Gibney, “H.P. Acthar Gel.”
  63. 63. In 2006, for example, Questcor lost $10.1 million on revenues of $12.8 million.
  64. 64. Don Bailey quoted in Pollack, “Questcor Finds Profits, at $28,000 a Vial.”
  65. 65. David White, “Questor Pharmaceuticals: Quickly Building A Multi-Billion Dollar Business,” Seeking Alpha, January 17, 2012.
  66. 66. Historical share price of QCOR at https://www.historicalstockprice.com/qcor-historical-stock-prices/.
  67. 67. Sergio Hernandez and Wayne Drash, “How CNN Reported on Acthar,” CNN, June 29, 2018.
  68. 68. Andrew Pollock and Chad Bray, “Mallinckrodt Pharmaceuticals to Buy Questcor for $5.6 Billion,” New York Times, April 7, 2014.
  69. 69. Hernandez and Drash, “How CNN Reported on Acthar.”
  70. 70. S. Shakil and Redberg RF, “New (Very High) Prices on Old Drugs,” JAMA Intern Med. 2017;177(11):1568.
  71. 71. Bourdette quoted in Linette Lopez, “The Most Respected Medical Journal In The US Just Eviscerated A Drug That’s Cost Taxpayers Over $1 Billion,” Business Insider, September 12, 2017.
  72. 72. Matt Novak, “Drug Company to Pay Just $15.4 Million Over Doctor Bribery Scandal Involving Medicine That Brings in $1 Billion a Year,” Gizmodo, June 5, 2019.
  73. 73. Shakil and Redberg, “New (Very High) Prices on Old Drugs,” 1568.
  74. 74. Novak, “Drug Company to Pay Just $15.4 Million Over Doctor Bribery.”
  75. 75. Beth Mole, “The 5,000 percent price hike that made Martin Shkreli infamous is no longer paying off,” ARSTechnica, July 19, 2018; Scarlet Fu, “Drug Goes From $13.50 to $750 Overnight,” Bloomberg, September 21, 2015.
  76. 76. Only 27 percent had a positive view while 58 percent had a negative opinion. Americans ranked even the federal government ahead of pharma. Justin McCarthy, “Big Pharma Sinks to the Bottom of U.S. Industry Rankings,” Gallup News, September 3, 2019.
  77. 77. Stephanie M. Lee, “Here’s How Big Pharma Plans To Clean Up After Martin Shkreli,” Science, BuzzFeed, January 10, 2017.
  78. 78. Tom Hays and Colleen Long, “ ‘Pharma Bro’ Martin Shkreli cries in court, is sentenced to 7 years for securities fraud,” Associated Press, March 9, 2018.
  79. 79. “ ‘Pharma Bro’ Shkreli Is In Prison, But Daraprim’s Price Is Still High,” Kaiser Health News, May 4, 2018.
  80. 80. Lee, “Here’s How Big Pharma Plans To Clean Up After Martin Shkreli.”
  81. 81. Marlene Haffner told NPR: “People have played games with the Orphan Drug Act since it was passed. It’s the American way, I don’t mean that in a nasty way. But we take advantage of what’s in front of us.”
  82. 82. Quoted in “How Pharma Companies Manipulate Orphan Drug Rule to Create Monopolies P&T Community,” https://www.ptcommunity.com/news/20170117/how-pharma-companies-manipulate-orphan-drug-rule-create-monopolies.

Chapter 51: The Coming Pandemic

  1. 1. “Antimicrobial Resistance: Tackling a crisis for the health and wealth of nations,” The Review on Antimicrobial Resistance, December 2014.
  2. 2. “In 15 European countries more than 10 percent of bloodstream Staphylococcus aureus infections are caused by methicillin-resistant strains (MRSA), with several of these countries seeing resistance rates closer to 50 percent.” See European Centre for Disease Prevention and Control Antimicrobial Resistance Interactive Database (EARS-NET) data for 2013. See also R. Monina Klevens et al., “Invasive Methicillin-Resistant Staphylococcus aureus Infection in the United States,” JAMA 298, no. 15 (2007): 1763–71; Gregory A. Filice et al., “Excess Costs and Utilization Associated with Methicillin Resistance for Patients with Staphylococcus aureus Infection,” Infection Control and Hospital Epidemiology 31, no. 4 (2010): 365–73.
  3. 3. “Antimicrobial Resistance: Tackling a crisis for the health and wealth of nations,” 5. See also Antibiotic Resistance Threats in the United States, 2013, U.S. Department of Health and Human Services, Center for Disease Control and Prevention, https://www.cdc.gov/drugresistance/pdf/ar-threats-2013-508.pdf.
  4. 4. Referring to a 2015 WHO report, in “Doctors Urged to Stop Prescribing Antibiotics for Colds and Flus,” CBS/AP, January 19, 2016.
  5. 5. L.A. Hicks, TH Taylor, Jr., and R.J. Hunkler, “US outpatient antibiotic prescribing, 2010,” 2013;368(15):1461–62. See also A. Huttner et al., “Antimicrobial Resistance: A Global View from the 2013 World Healthcare Associated Infections Forum,” 2013;2(1):31; Blaser, Missing Microbes, 84–86.
  6. 6. Another Obama administration health priority in 2015 was passing the Drug Supply Chain Security Act. It sought to upgrade the safety of compounded medicines following a severe outbreak of fungal meningitis that killed sixty-four people. It also sought to better track the distribution of prescription drugs through the supply chain in the hope of cutting back on stolen, counterfeit, and contaminated medications. Sabrina Tavernise and Michael D. Shear, “Obama Seeks to Double Funding to Fight Antibiotic Resistance,” New York Times, March 27, 2015. As for 30 percent of antibiotics dispensed to Americans being unnecessary, see “Antibiotic Use in the United States, 2017: Progress and Opportunities,” U.S. Department of Health and Human Services, Centers for Disease Control and Prevention; Atlanta, GA: 2017.
  7. 7. Nick Cumming-Bruce, “W.H.O. Plan Aims to Combat Resistance to Antibiotic Drugs,” New York Times, May 25, 2015.
  8. 8. Ibid.
  9. 9. Morbidity and Mortality Weekly Report, Centers for Disease Control, Vol. 68, 2019. By 2019, some infectious disease specialists called on countries to list antibiotic resistance as a cause of death on official certificates. Doing so would provide researchers with more accurate data and also bring attention to the health crisis. Sarah Newey, “Superbugs Should Be Entered as a Cause of Death on Death Certificates, Say Experts,” The Telegraph (U.K.), November 21, 2019.
  10. 10. “Antibiotic/Antimicrobial Resistance (AR/AMR) Biggest Threats and Data,” Report of the Centers for Disease Control, 2013 (the CDC website says it “is working towards releasing an updated AR Threats Report in fall 2019”).
  11. 11. Many of the most “dangerous pathogens were hiding in plain sight,” said the CDC’s deputy director. Eleven percent of the health care workers screened carried the superbugs although they were asymptomatic. The concern at the CDC is that while those people might have a natural immunity they could be carriers that infect others, especially immunosuppressed patients. Alexandra Sifferlin, “CDC Finds ‘Nightmare Bacteria’ Across the U.S. Here’s What That Means,” Time, April 3, 2018.
  12. 12. The CDC’s official position is: “Like in humans, giving antibiotics to food animals will kill most bacteria, but resistant bacteria can survive. When food animals are slaughtered and processed, resistant germs in the animal gut can contaminate the meat or other animal products. Resistant germs from the animal gut can also get into the environment, like water and soil, from animal manure. If animal manure or water containing resistant germs are used on fruits, vegetables, or other produce as fertilizer or irrigation, then this can spread resistant germs.” https://www.cdc.gov/drugresistance/food.html.
  13. 13. Thomas P. Van Boeckel et al., “Reducing Antimicrobial Use In Food Animals,” Science, September 29, 2017. 1350–52. See J. O’Neill, “Antimicrobials In Agriculture And The Environment: Reducing Unnecessary Use And Waste,” Review on Antimicrobial Resistance, 2016.
  14. 14. “Fact Sheet: Veterinary Feed Directive Final Rule and Next Steps,” FDA, July 29, 2019.
  15. 15. Andrew Jacobs, “Citrus Farmers Facing Deadly Bacteria Turn to Antibiotics, Alarming Health Officials,” New York Times, May 17, 2019.
  16. 16. “Antimicrobial Susceptibility Testing of Human Bacterial Pathogens to Antibiotics Used as Pesticides,” Report to EPA, May 11, 2017, in collection of author.
  17. 17. Erik Wistrand-Yuen et al., “Evolution Of High-Level Resistance During Low-Level Antibiotic Exposure,” Nature Communications, 2018; 9 (1).
  18. 18. Jacobs, “Citrus Farmers Facing Deadly Bacteria Turn to Antibiotics, Alarming Health Officials.”
  19. 19. Ibid.
  20. 20. “Antibiotic Resistance Threats in the United States, 2019,” U.S. Department of Health and Human Services, Centers for Disease Control and Prevention, November 2019, 1–143.
  21. 21. Jason Gale, “The Deadly African Virus That’s Killing China’s Pigs,” Washington Post, May 2, 2019.
  22. 22. Author interview with Karen Bush, November 7, 2016. See also David Shlaes, “The Abandonment of Antibacterials: Why and Wherefore?,” Current Opinion in Pharmacology 3, no. 5 (2003): 470–73; Steven Projan, “Why is Big Pharma Getting Out of Antibacterial Drug Discovery?,” Current Opinion in Microbiology 6, no. 5 (2003): 428; see H. W. Boucher et al., “Bad Bugs, No Drugs: No ESKAPE! An Update From The Infectious Diseases Society Of America,” Clin Infect Dis. 2009 Jan 1;48(1):1–12.
  23. 23. The first new drug in the class was Pharmacia’s Zyvox. Milton and Lee, Pills, Profits and Politics, 33.
  24. 24. Amy Nordrum, “Antibiotic Resistance: Why Aren’t Drug Companies Developing New Medicines To Stop Superbugs?” International Business Times, March 3, 2015. At present, this approach has remained essentially unchanged. See Andrew Pollock, “Antibiotic Subsidies Weighed by US,” New York Times, November 6, 2010. See also, “Tracking the Pipeline of Antibiotics in Development,” Antibiotic Resistance Project, The Pew Charitable Trusts, 2015.
  25. 25. J. Sun et al., “A systematic analysis of FDA-approved anticancer drugs,” BMC Syst Biol. 2017;11(Suppl 5):87. October 3, 2017.
  26. 26. Forty-five percent of cancer patients are expected to survive at least ten years, compared with 23 percent in the 1970s. Matthew Weaver, “Cancer Survival Rates Have Doubled Since 1970s, Research Shows,” Guardian, July 12, 2010.
  27. 27. A good example of misplaced priorities was Upjohn. It depended on antibiotic sales for almost half its gross revenues from the early 1950s through the mid-1960s. During World War II when penicillin revolutionized the pharma market, Upjohn had twelve scientists researching those drugs. In 1970, it had more than four hundred scientists, but fewer than a dozen were assigned to antibiotics. Author interview with Barry Eisenstein, December 19, 2016. See also “Report: Bad Bugs, No Drugs: As Antibiotic R&D Stagnates A Public Health Crisis Brews,” Infectious Disease Society of America, 2004.
  28. 28. Author interview with Mike Skoien, December 21, 2016.
  29. 29. Author interview with Barry Eisenstein, December 19, 2016.
  30. 30. Author interview with Steven Projan, December 5, 2016.
  31. 31. Author interview with Barry Eisenstein, December 19, 2016.
  32. 32. Author interview with Karen Bush, November 30. 2016.

Chapter 52: “Essentially a Crime Family”

  1. 1. Hadland, “Association of Pharmaceutical Industry Marketing of Opioid Products to Physicians With Subsequent Opioid Prescribing.”
  2. 2. Walters, “America’s Opioid Crisis: How Prescription Drugs Sparked A National Trauma.”
  3. 3. In 1993, life expectancy declined by 0.3 percent. See Lopez and Frostenson, “How The Opioid Epidemic Became America’s Worst Drug Crisis Ever.”
  4. 4. Ibid. The attraction for many was that the price of heroin was cheap compared to high-dosage opioids and it was often easier to obtain than dealing with the increasing restrictions on prescriptions in some states. For the Veterans Administration, see “Calculating Total Daily Dose Of Opioids For Safer Dosage,” CDC.
  5. 5. Lopez and Frostenson, “How The Opioid Epidemic Became America’s Worst Drug Crisis Ever,” and German Lopez, “The Opioid Epidemic, Explained,” Vox, December 21, 2017.
  6. 6. Survey: Many Doctors Misunderstand Key Facets of Opioid Abuse, Johns Hopkins Bloomberg School of Public Health, June 23, 2015. Purdue was not the only drug company selling opioids and breaking the rules on promotion and marketing. Insys Therapeutics, founded in 2013, was a one-drug company. Its future depended on a single opioid drug approved for “breakthrough” pain in terminal cancer patients. The small detail team used an updated version of Purdue’s playbook. Insys sales reps pitched it for everything from regular back pain to arthritis, even treating depression. Doctors who prescribed the most drugs, and at the highest dosages, were rewarded with lucrative contracts for the company’s “Speakers Bureau.” Many times, the physicians never even gave a talk but got paid anyway (that is illegal, since federal regulations require at least two doctors to be at a public event; otherwise the “speaker’s fee” is judged a bribe). Doctors whose prescribing dropped off were struck from the speaker’s bureau. And Insys set a new low for their detail team. The company hired as a supervisor in sales a former exotic dancer who had no prior experience in pharmaceuticals. Dubbed “a closer” inside the company, at least once she did a lap dance on a physician in order to encourage him to write more prescriptions. The results of all the shady and unauthorized marketing? Over three years, the company’s opioid sales went from seven thousand annual prescriptions to sixty thousand. That pushed the stock price up from $5 in 2015 to a high in late 2017 of $44.92, making its owner a billionaire. As of January 2019, Kapoor and four Insys sales managers were charged with criminal racketeering and conspiracy. Insys’s stock price had crashed, down by 95 percent. All five were convicted of conspiracy and racketeering on May 2, 2019. Each faces up to twenty years in prison. “ ‘We Owe Much to the Sackler Family.’ ”
  7. 7. The CDC is considered the most reliable source of opioid overdose death figures. It collects underlying data from the National Vital Statistics System, a web-based “Injury Statistics Query and Reporting System,” and an online database that the CDC says provides “data from a variety of trusted sources.” See generally https://www.cdc.gov/drugoverdose/data/statedeaths.html.
  8. 8. In November 2017 four West Virginia cities filed a class action lawsuit against the Joint Commission, alleging that when it issued its pain management standards in 2001 it had deliberately underplayed the dangers of opioids. See Joint Commission Statement on Pain Management, April 18, 2016,
  9. 9. Sarah Varney, “Beset by Lawsuits and Criticism in U.S., Opioid Makers Eye New Market in India,” Kaiser Health News, August 28, 2019.
  10. 10. “We’re only just getting started” according to one Mundipharma promotional video. “Pharma Leader Series: Top 50 Generic Drug Manufacturers 2012–2022,” CISION PR Newswire, Macy 2, 2012; Harriet Ryan, Lisa Girion, and Scott Glover, “OxyContin Goes Global—‘We’re Only Just Getting Started,’ ” Los Angeles Times, December 18, 2016.
  11. 11. Ryan, Girion, and Glover, “OxyContin Goes Global.”
  12. 12. Max Blau, “Opioids could kill nearly 500,000 Americans in the next decade,” STAT, June 27, 2017.
  13. 13. “Put another way, opioids could kill nearly as many Americans in a decade as HIV/AIDS has killed since that epidemic began in the early 1980s.” Blau, “Opioids could kill nearly 500,000 Americans in the next decade.”
  14. 14. “Purdue Pharma Promoted OxyContin for Years. Now, It Is Combating the Opioid Crisis,” PBS NewsHour, March 14, 2018.
  15. 15. W. Timothy Coombs, Texas A&M Professor of Crisis Communications, quoted in “Purdue Pharma Promoted OxyContin for Years. Now, it is Combating the Opioid Crisis.”.
  16. 16. Ibid.
  17. 17. “Cure to the Crisis?” NBC Weekend National News, March 18, 2018. See also Walters, “America’s Opioid Crisis: How Prescription Drugs Sparked A National Trauma.”
  18. 18. The network of Sackler Mundi companies operating from Bermuda included Mundipharma International, Mundipharma Pharmaceutical Company, Mundipharma Medical Company, Mundipharma International Holdings, Mundipharma Laboratories, Mundipharma International Corporation, Mundipharma Research Company, Mundipharma Company, and Rooksnest Estate and Merganser Ltd. The companies used the same address on Par-la-Ville Road in Hamilton, Bermuda. Tax experts who looked at the arrangement for Britain’s Evening Standard estimated that based on the amount of OxyContin Napp sold, it had saved over $1.4 billion in taxes over a quarter century. It was technically legal since it took advantage of a loophole in the U.K. tax law that was closed after the Sackler revelations.

    The author found an overlap between the directors of half a dozen Mundipharma companies and some of the firms listed in the Evening Standard exposé, including Merganser Limited and Rooksnest Estate Limited. Documents released as part of the leak of papers from the Bermuda law firm, Appleby, referred to as the Paradise Papers, available as a searchable database maintained by the International Constortium of Investigative Journalists (ICIJ).

    The Sackler family’s only statement to the Evening Standard was through a spokesman: “The late Dr Mortimer Sackler paid full UK taxes, including on all UK-sourced income, capital gains and monies remitted to the UK. His heirs also pay the full amount of UK taxes as required by law.” See David Cohen, Special Investigation, “Opioid Timebomb Series”—“Revealed: Tax Secrets of the Opioid Billionaires”; “Revealed: Sackler Family Linked To Worldwide Drugs Crisis Saves Millions Using Offshore Haven And Non-Dom Status”; “Prescriptions Are Double What the Government Told Us”; “Taxman Criticised for Letting Sackler Firms ‘Dodge Corporation Tax’ ”; “How a Painkiller Addiction Cost This Man Everything”; “The Sackler Family And How Their Painkiller Fortune Helps Bankroll London Arts”; “Princes’s Trust Stops Taking Donations from Sackler Family,” May 11, 2018 through September 2019.

  19. 19. Author review of Registry and Company files in the U.K.
  20. 20. Renae Reints, “Family Behind Purdue Pharma and OxyContin Faces Multiple Lawsuits,” Fortune, November 19, 2018.
  21. 21. Judge Dan A. Poster, of the Federal District Court in Cleveland, oversees the multidistrict litigation. Matthew Goldstein, Danny Hakim, and Jan Hoffman, “Sacklers vs. States: Settlement Talks Stumble Over Foreign Business,” New York Times, August 30, 2019.
  22. 22. It was an amended complaint of the original submitted by Massachusetts for the multidistrict litigation against the company and some individual directors and Sackler family members. Massachusetts v. Purdue, C.A. 1884-cv-01808 (BLS2), Filed January 31, 2019.
  23. 23. Since the Massachusetts suit, nineteen other states have named the Sacklers as defendants through September 2019, and others are expected to do so. Joel Achenbach, “Purdue Pharma Reaches Tentative Deal in Federal, State Opioid Lawsuits,” Washington Post, September 11, 2019, 1; Jesse Paul, “Colorado expands lawsuit against opioid-maker Purdue Pharma to include its owners, the Sackler family,” Colorado Sun, July 1, 2019.
  24. 24. Joanna Walters, “Sackler Family Members Face Mass Litigation And Criminal Investigations Over Opioids Crisis,” Guardian, November 19, 2018.
  25. 25. In mid-August, the New York attorney general subpoenaed banking institutions and money managers who had worked with the Sacklers. See David Robinson, “NY AG subpoenas financial advisers, banking institutions tied to Sacklers, Purdue, opioids,” Lohud, August 16, 2019; Morrell, “The OxyContin Clan: The $14 Billion Newcomer to Forbes 2015 List of Richest U.S. Families.” As for the billion dollars transferred through Swiss banks, see Danny Hakim, “New York Uncovers $1 Billion in Sackler Family Wire Transfers,” New York Times, September 13, 2019, 1.
  26. 26. Walters, “Sackler Family Members Face Mass Litigation And Criminal Investigations Over Opioids Crisis.”
  27. 27. Expert Report Of Professor John C. Coffee, Jr., Matter Of: Purdue Pharma L.P., et al, DCP Case No. 107102, July 12, 2019, in collection of author.
  28. 28. Benjamin Sutton, “Elizabeth A. Sackler Supports Nan Goldin in Her Campaign Against OxyContin,” Hyperallergic, January 22, 2018. One criticism of Elizabeth Sackler was that the foundation for her uncle Mortimer Sackler had made a $500,000 gift to the Brooklyn Museum, designated for the Elizabeth A. Sackler Center for Feminist Art. Mortimer’s wealth was largely built on the success of OxyContin. See Ethan Barton, “Opioid Billionaires’ Niece Denounces Family Company After Her Art Center Took $500,000,” Daily Caller, January 18, 2018.
  29. 29. Jillian Sackler, “Stop Blaming My Late Husband, Arthur Sackler, For The Opioid Crisis,” Washington Post, April 11, 2019.
  30. 30. See also “Disclaimer—Statement by Jillian Sackler,” http://www.sackler.org/about/, and Barton, “Opioid Billionaires’ Niece Denounces Family Company After Her Art Center Took $500,000.”
  31. 31. From 1999 to 2017, there were 218,000 deaths. That included prescription as well as illegal opioids as the cause of death. Another 72,000 died in 2018 and the federal government lists 68,588 as of August 4, 2019. The most recent annual statistics represent the first time in over a decade that the number of opioid-related overdose deaths declined. Experts are divided about whether it is the beginning of a trend or a onetime anomaly in the epidemic. See NCHS, National Vital Statistics System. Estimates for 2018 and 2019 are based on provisional data. See also R. A. Rudd et al., “Increases in Drug and Opioid-Involved Overdose Deaths—United States, 2010–2015,” MMWR Morb Mortal Wkly Rep 65(5051):1445–52. 2016.
  32. 32. “I admire Nan Goldin’s commitment to take action and her courage to tell her story. I stand in solidarity with artists and thinkers whose work and voices must be heard.” Elizabeth Sackler statement issued to Hyperallergic. Benjamin Sutton, “Elizabeth A. Sackler Supports Nan Goldin in Her Campaign Against OxyContin.”
  33. 33. Laura Strickler, “OxyContin maker Purdue Pharma agrees to $270M settlement with Oklahoma: source,” NBC News, March 26, 2019 (confirmed and announced publicly on March 28).
  34. 34. J&J’s share price rose the next day as Wall Street investors had expected a judgment of about $1 billion. The trial judge lowered it to $465 million in November 2019, but the company has appealed the verdict. Hoffman, “Johnson & Johnson Ordered to Pay $572 Million in Landmark Opioid Trial.” As for the public nuisance laws, see Henry Gass and Christa Case Bryant, “When It Comes to Opioid Crisis, What Does Justice Look Like?,” Christian Science Monitor, August 28, 2019. Scott Higham and Lenny Bernstein, “Drug Companies Seek Removal of Judge in Landmark Opioid Case,” Washington Post, September 14, 2019.
  35. 35. James McClain, “OxyContin Heir David Sackler Spends $22.5 Million In Bel Air,” Dirt, March 7, 2018.
  36. 36. David Sackler is listed as the CEO of Summer Road LLC, which according to the Palm Beach Post is “an entity that manages the Sacklers’ fortune.” Summer Road LLC is listed on state records as the purchaser on July 31, 2019, of the Glidden Spina Architecture building at 207 Sixth St, West Palm Beach. Summer Road LLC moved into that building, and the Palm Beach Post reports that David Sackler and his wife, Joss, moved into the “sprawling mansion” in Boca Raton. See Alexandra Clough, “Purdue Pharma Family Office Move To WPB Is ‘Salt In The Wounds,’ Lawyer Says,” Palm Beach Post, September 18, 2019, 1; Alexandra Clough, “EXCLUSIVE: Sackler Family Company Pays $7 Million For Mansion Near Boca Raton,” Palm Beach Post, October 25, 2019, 1.
  37. 37. When news of the Florida purchases became public in late September, one lawyer representing Palm Beach County in its lawsuit against Purdue and some of the former Sackler-family directors told the Palm Beach Post that “It’s rubbing salt in the wounds.” Hunter Shkolnik interviewed in Clough, “Sackler Family Company Pays $7 Million For Mansion Near Boca Raton.”
  38. 38. McLean, “ ‘We Didn’t Cause The Crisis.’ ”
  39. 39. Chris Spargo, “Heir to $13B OxyContin Fortune Says Son, 4, Asked if Family Kills People, Rejects Blame for Opioid Crisis and Plays Victim in Interview,” Daily Mail, June 28, 2019.
  40. 40. The top selling drug companies for opioids from 2006 to 2012 were two generic firms, Actavis Pharma and Mallinckrodt’s subsidiary, SpecGx. “Opioids Market Size, Share & Trends Analysis Report By Product (IR/ Short-acting, ER/Long-acting), By Application (Pain Relief, Anesthesia), By Region, And Segment Forecasts, 2019–2026,” Grand View Research, April 2019, 1–113. See also “Common Myths About OxyContin® (oxycodone HCl) Extended-Release Tablets CII,” Purdue Pharma at https://www.purduepharma.com/news-media/common-myths-about-oxycontin/. For David Sackler, see McLean, “ ‘We Didn’t Cause The Crisis.’ ” See also David Armstrong and Jeff Ernsthausen, “Data Touted by OxyContin Maker to Fight Lawsuits Doesn’t Tell the Whole Story,” ProPublica, September 9, 2019.
  41. 41. RICO, passed in 1970, is used more frequently now for civil cases, where it allows for triple damages, than in criminal cases. Walter Pavlo, “Once Meant To Nail Mobsters, RICO Sees Resurgence In Civil Cases In 2018,” Forbes, Octrober 31, 2018. Ohio Judge Dan Aaron Polster did not dismiss racketeering and fraud claims filed by the Ohio cities of Akron and Cleveland and counties of Cuyahoga and Summit. Polster ruled that key claims made in pending lawsuits should proceed to trial and denied the requests of drug manufacturers and distributors that the charges be dropped. In Re: National Prescription Opiate Litigation, This Document Relates To, The County of Summit, Ohio, et al. v. Purdue Pharma L.P., et al., Case No. 18-op-45090 (MDL 2804), Case No. 1:17-md-2804,
  42. 42. That was a far cry from the estimate nine months earlier by Mike Moore, the former Mississippi attorney general, that a complete settlement of all opioid litigation would top $100 billion. “Purdue Pharma Promoted OxyContin for Years. Now, It Is Combating the Opioid Crisis,” PBS News Hour, March 14, 2018. See also Walters, “Sackler Family Members Face Mass Litigation And Criminal Investigations Over Opioids Crisis.”
  43. 43. Jef Feeley and Riley Griffin, “Sackler Family Backs $11.5 Billion Purdue Opioid Settlement,” Bloomberg, August 27, 2019.
  44. 44. There is precedent for such an arrangement. Both Halliburton and W. R. Grace had separate trusts established and managed by court-appointed trustees to settle claims from asbestos litigation. See Feeley and Griffin, “Sackler Family Backs $11.5 Billion Purdue Opioid Settlement”; Mike Spector and Jessica DiNapoli, “Exclusive: OxyContin maker prepares ‘free-fall’ bankruptcy as settlement talks stall,” Reuters, September 3, 2019.
  45. 45. And see ibid.
  46. 46. Jared S. Hopkins and Sara Randazzo, “Proposed Opioid Deal With Purdue Drawing Pushback From States,” Wall Street Journal, August 29, 2019, 1.
  47. 47. Mundipharma’s own website listed its value at $7 billion in 2017. It is almost impossible to get a fair market value since all Mundipharma firms operate separately as private companies and there are no unified sales and profits numbers.
  48. 48. The Sacklers agreed to pay $500 million the first year, then $300 million from years two through six, and the final $1 billion in the seventh year. Lenny Bernstein et al., “OxyContin Owners May Retain The Bulk Of Their Billions,” Washington Post, August 31, 2019.
  49. 49. Bernstein, “OxyContin Owners May Retain The Bulk Of Their Billions.”
  50. 50. Feeley and Griffin, “Sackler Family Backs $11.5 Billion Purdue Opioid Settlement.”
  51. 51. Joel Achenbach, “Purdue Pharma Reaches Tentative Deal in Federal, State Opioid Lawsuits,” Washington Post, September 11, 2019, 1.
  52. 52. Ed Silverman, “Purdue Pharma’s newly created subsidiaries raise questions over attempts to shield assets from bankruptcy,” STAT, April 1, 2019.
  53. 53. Adam Geller, “Where Did the Sacklers Move Cash From Their Opioid Maker?” Associated Press, September 2, 2019.
  54. 54. The Sackler directors voted themselves over $4 billion in OxyContin profits from 2008 through 2016. Based on information received from subpoenas, New York State investigators tracked a billion dollars in transfers suggesting some family members tried shielding their wealth in case of an adverse litigation ruling. Some Oxy profits passed through a Swiss bank account located in the Channel Islands before getting transferred to a series of trusts (Millborne Trust Company, Heatheridge Trust Co., and Purdue Pharma Trust MDAS). Hakim, “New York Uncovers $1 Billion in Sackler Family Wire Transfers.” Profit statistics are from the office of the Massachusetts attorney general and based on Purdue’s board documents. See Tom Maloney and Jef Feeley, “Sacklers to Remain Billionaire Family If Purdue Settles Opioid Lawsuits,” Bloomberg, August 28, 2019.
  55. 55. Author’s review of registry and company files.
  56. 56. McClain, “OxyContin Heir David Sackler Spends $22.5 Million In Bel Air.”
  57. 57. Geller, “Where Did the Sacklers Move Cash From Their Opioid Maker?” See also David Crow, “Billionaire Sackler family owns second opioid drugmaker,” Financial Times, September 15, 2018.
  58. 58. On some figures there was mutual agreement. Purdue’s cash balance was $500 million. Its largest asset is a group of liability insurance policies worth approximately another $500 million. The policies provide $725 million in coverage but the plaintiffs expect the insurance companies to deny full coverage by insisting that any intentional acts of fraud are outside the coverage terms. A settlement with the insurance companies is expected to bring in two thirds of the face value of the policies. A sale of Purdue’s headquarters, manufacturing facilities, and patents would bring an estimated $750 million. Author interview with a party familiar with the negotiations, September 5, 2019. Bernstein et al., “OxyContin owners may retain the bulk of their billions.”
  59. 59. Bernstein, “OxyContin Owners May Retain Bulk of Their Billions.” See also Jared S. Hopkins and Andrew Scurria, “Sacklers Received $12 Billion to $13 Billion in Profits from OxyContin Maker Purdue Pharma,” Wall Street Journal, October 4, 2019, 1.
  60. 60. Ibid.
  61. 61. “FDA approves first generic naloxone nasal spray to treat opioid overdose,” FDA News Release, April 19, 2019.
  62. 62. Achenbach, “Purdue Pharma Reaches Tentative Deal in Federal, State Opioid Lawsuits.”
  63. 63. Feeley and Griffin, “Sackler Family Backs $11.5 Billion Purdue Opioid Settlement.”
  64. 64. After news had broken of the proposed settlement, Connecticut attorney general William Tong issued a statement: “Connecticut demands that the Sacklers and Purdue management be forced completely out of the opioid business, domestically and internationally, and that they never be allowed to return.” Bernstein, “OxyContin Owners May Retain The Bulk Of Their Billions.”
  65. 65. That is the estimated value of an immediate auction of the company’s assets, including the $500 million in cash. Bernstein, “OxyContin Owners May Retain The Bulk Of Their Billions.” See also Spector and DiNapoli, “Exclusive: OxyContin maker prepares ‘free-fall’ bankruptcy as settlement talks stall.”
  66. 66. Sarah Skidmore Sell, Geoff Mulvihill, and Adam Geller, “What a Purdue Bankruptcy Means for the Sackler Family,” Washington Post, September 12, 2019.
  67. 67. Sara Randazzo and Jared S. Hopkins, “OxyContin Maker Purdue Pharma Files for Bankruptcy Protection,” Wall Street Journal, September 16, 2019. See Spector and DiNapoli, “Exclusive: OxyContin maker prepares ‘free-fall’ bankruptcy as settlement talks stall”; Bernstein et al., “OxyContin owners may retain the bulk of their billions”; and Joel Achenbach, “Purdue Pharma Reaches Tentative Deal in Federal, State Opioid Lawsuits,” Washington Post, September 11, 2019, 1.
  68. 68. Dan Mangan, “Economic cost of the opioid crisis: $1 trillion and growing faster,” CNBC, February 13, 2018.