Discover more from Just the Facts with Gerald Posner
"I thought I understood the Sacklers' opioid empire. Startling documents I found showed I was wrong"
What could possibly be new about the Sackler family, the billionaire owners of Purdue Pharma?
That was a question I asked myself in the late fall of 2015 as I began doing research for the book that would become “Pharma.” The project I had pitched to my publisher was a comprehensive history of the American pharmaceutical industry, starting with patent drugs and finishing with biotechnology breakthroughs. Covering the full breadth of the domestic drug industry in a single, readable volume meant I would have to compress into single chapters many consequential matters that had been the focus of full-length books.
My first outline included two chapters about the opioid epidemic and the family that Forbes dubbed “the Oxycontin Clan” when it welcomed the Sacklers to the magazine’s 2015 list of the richest U.S. families.
I didn’t expect to break any news about the family because many good journalists had already written extensively about them. It was by then a familiar tale: Three patriarchs — psychiatrist brothers Arthur, Mortimer, and Raymond Sackler — had played roles in the pharmaceutical industry decades before anyone dreamed of OxyContin. Arthur, the eldest, had revolutionized pharmaceutical advertising and in so doing helped Hoffman LaRoche’s Valium become the industry’s first $100 million seller.
So why did half of “Pharma” ultimately become about the Sacklers and the opioid epidemic? Fresh interviews and previously classified documents brought their backstory to life. What emerged in my reporting was an intimate and at times startling look inside the family. It also unexpectedly provided a lens by which to examine larger themes in the pharmaceutical industry’s explosive growth after World War II.
One of the first revelations came from an unpublished government memo I found at the National Archives. It was about a Senate investigation into “a Sackler empire.” That might not seem extraordinary now except for its date — March 16, 1962 — 34 years before anyone had heard of OxyContin. John Blair, the chief economist for Sen. Estes Kefauver’s antitrust and price fixing probe of the drug industry, wrote that “from time to time [I] heard the rumors of the ‘Sackler Brothers’ or ‘Sackler Empire.’ At first, I had been under the impression that this is something of a ‘fringe’ operation, of passing interest because of its unique character but of little substantive importance. As I have gathered further information, however, I have been forced to modify this earlier impression. The Sackler brothers [are] hardly a fringe operation…. [t]he very number of organizations in every facet of the drug industry which are under their ownership, control or influence, is such that they must be regarded as constituting a relatively large-scale operation.”
Blair attached a list of 20 companies that his investigators suspected “the Sackler brothers own or control” through proxies.
I used that as the starting point for retrieving hundreds of incorporation records that I cross-checked against 1950s and 1960s telephone listings and public records. From that I compiled a list of several dozen Sackler-controlled businesses with the same addresses and phone numbers. Some were ad firms, others did medical research, clinical testing, and even medical publishing.
Sometimes the brothers increased their odds of landing a government research grant by having several of their companies “compete” as seemingly independent contenders. Other times they hid their roles in data collection firms or ventures that produced prepackaged ads disguised as editorial stories. Once the brothers concealed multiple conflicts of interest in an over-the-counter vitamin promotion, a questionable clinical study, and an eventual public stock offering that resulted in 1958 in their first multimillion dollar payout.
The Senate wasn’t the only federal organization to shine a spotlight on the Sacklers. FBI files declassified as a result of my Freedom of Information Act requests revealed that the brothers were hard-line leftists. When a confidential FBI informant took photos of the 1944 membership list of the Communist Party of America Kensington Club on Church Avenue in Brooklyn, they showed the names of Raymond Sackler, the youngest brother, and his wife, Beverly. (Raymond was Purdue’s CEO when the company launched OxyContin in 1996 and Beverly was a director).
The FBI investigated the Sacklers many times over nearly a quarter-century. Arthur came under suspicion because he gave money to radical left causes and, during the Red Scare of the 1950s, provided many blacklisted journalists a second chance at his advertising and publishing companies. The bureau developed an informant inside Arthur’s main ad agency. Alarm bells went off when the FBI learned about Arthur’s friendship with Alfred Stern and Stern’s wife, Martha Dodd, both of whom had fled the U.S. as suspected Soviet spies. The probe into possible espionage on Arthur’s part went nowhere, according to the files, though I am still waiting for the release of additional FBI files, expected later this year.
The Sacklers brought new ways of thinking to drug business and later applied their concepts to Purdue. One of Arthur’s former business partners told me how the senior Sackler had underlined two sentences from a 1976 New York Times magazine article about Valium: “A drug has no moral or immoral qualities. These are the monopoly of the user or abuser.” Twenty-five years later, Richard Sackler, Arthur’s nephew and then president of Purdue, wrote an email responding to a New York Times article about abuse and diversion of OxyContin: “We have to hammer on the abusers in every way possible. They are the culprits and the problem. They are reckless criminals.”
The most significant breakthrough in my reporting wasn’t the result of knocking on doors or sifting through boxes at the National Archives. It came via a sealed brown manila envelope postmarked from New York without a return address that arrived at my Miami-area office. Inside of it were several hundred pages, including copies of government documents, sent by an anonymous whistleblower that make a powerful case that OxyContin was already a deepening national crisis by 2002.
An unpublished 45-page PowerPoint presentation helped fill in details of a 2002 standoff between the Drug Enforcement Administration and the Food and Drug Administration over how best to control OxyContin’s growing abuse and diversion. The PowerPoint, which had been made by the DEA, was shown to three senior Purdue executives and Deborah Leiderman, the director for controlled substances in the FDA’s Center for Drug Evaluation and Research. The DEA officials at that summit expected the Purdue executives to dismiss the evidence as cherry-picked. What they did not expect, according to a former DEA officer familiar with what happened, was that the FDA official shocked everyone by backing Purdue. It was the FDA’s way of pushing back against what it considered as the DEA’s encroachment on its regulatory turf.
The unintended consequence of this bureaucratic power struggle was that Purdue felt emboldened and launched even more aggressive marketing for its blockbuster painkiller. The price Americans paid for that standoff later became clear as the number of overdose deaths involving prescription opioids has grown each year. When the DEA had unsuccessfully urged the FDA to place dispensing restrictions on OxyContin, just over 10,000 Americans had died from prescription opioids. That number has now topped 200,000.
“It was as if they [the FDA] were going out of their way in giving Purdue a free pass,” an ex-DEA official told me. “What the hell was going on over there?”
It is an unresolved question and one that many Americans, particularly the families of opioid victims, should have answered.
Gerald Posner is a journalist and author. His most recent book is “Pharma: Greed, Lies, and the Poisoning of America” (Avid Reader Press, March 2020).