Members of Congress confront Sacklers, Purdue Pharma CEO
STAMFORD — Two owners and the chief executive of OxyContin maker Purdue Pharma f aced a scathing Congressional hearing Thursday, as their testimony f ailed to sway lawmakers who called for criminal prosecution of the firm’s “evil” leaders.
The House Committee on Oversight and Reform convened the online meeting as part of it s investigation into role Stamford-based Purdue and its Sackler f amily owners allegedly played in fueling the national opio id epidemic. The acrimonious hearing was Purdue’s and the Sacklers’ most public grilling to date. The company pleaded guilty last month to three criminal charges and is still dealing through bankr uptcy with several thousand lawsuits accusing it of deceptively marketing OxyContin.
“People str uggling with addiction are not criminals. Your f amily and Purdue Pharma — you are the criminals,” said Rep. Ayanna Pressley, D-Massachusetts. “You are the ones who disregarded your duties to society, and you should be ashamed of yourselves.”
‘Sadness’ about crisis
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From the hearing ’s outset, committee members assailed the company and depicted the Sacklers as key culprits in a crisis in which nearly 450,000 people have died from opio id overdoses since 1999. The hearing included pre-recorded video statements from several witnesses whose children had died after taking OxyContin or had sur vived addiction to the dr ug.
“Most despicably, Purdue and the Sacklers worked to deflect the blame for all that suffering away from themselves and onto the people suffering with OxyContin addiction,” said Carolyn Maloney, D-New York, chair woman of the committee.
Contention had already marked the lead-up to the hearing, one of the rare occasions in which any company executives or owners testified publicly. Committee members had threatened subpoenas after they said four of the Sackler
owners of Purdue had declined invitations to t esti f y. In the end, co-owners David and Kathe Sackler and Purdue CEO and President Craig Landau appeared of their own volition.
“I want to express my f amily’s deep sadness about the opio id crisis,” David Sackler, a grandson of one of Purdue’s late founders and a board member from 2012 to 2018, said in his opening statement. “There are many lawsuits that have blamed Purdue and my f amily for the opio id crisi s. While we deny liability and are vigorously contesting these claims, we want to respond to the opio id crisis because a prescription medicine that our company manuf actured and sold, which was never intended to harm anyone, ended up being a part of a crisis that has harmed too many people.”
Kathe Sackler, a daughter of one of Purdue’s late founders and who ser ved on the company’s board from 1990 to 2018, made similar comments.
“I know the loss of any f amily member or loved one is terribly painful, and nothing is more tragic than the loss of a child,” she said. “As a mother, my heart breaks for those parents who have lost their children. It distresses me greatly and angers me greatly that the medication that was developed to help people and relieve se
vere pain has become associated with so much human suffering.”
In his opening statement, Landau said he wanted to speak to ever yone affected by the opio id epidemic. He said the company was “charting a new course” under his leadership. Major changes since he took over in June 2017 have included the end of opio id marketing and the disbanding of the company’s sales force, he said.
“On behalf of Purdue, as it s current leader, I’m profoundly sorr y,” Landau said. “In tr ying to strike a careful balance between supporting physicians who treat patients with pain and mitigating the serious risks associated with the opio id medications, Purdue fell short. The company accepts full responsibility for its wrongdo ing. And as Purdue’s leader, I’m determined to lead all of our efforts to address the opio id crisis as quickly and effectively as I can.”
But even after being repeatedly pressed by committee members, none of the three admitted to personal wrongdo ing.
“I have tried to figure out there anything that I could have done differently knowing what I knew then,” Kathe Sackler said. “I have to say there is nothing that I can find that I would have done differis ently based on what I believed and understood then, and what I learned from management and reports to the board and what I learned from my colleagues on the board.”
The answers incensed committee members on both sides of the aisl e.
“Watching you testify makes my blood bo il,” Rep. Jim Cooper, R-Tennessee, said later in the hearing. “I‘m not sure that I’m aware of any f amily in America that’s more evil than yours.”
Calls for stronger prosecution
Throughout the hearing, committee members also vented about the company’s and the Sacklers’ recently agreedupon settlements with the U.S. Department of Justice.
As part of Purdue’s approximately $ 8 billion settlement, the company pleaded guilty to defrauding the government and violating anti-kickback laws.
At the same time, the Sacklers agreed to a $ 225 million settlement to resolve allegations of marketing misconduct. The Sacklers did not admit any wrongdo ing.
None of the Sacklers or any current or former Purdue executives have f aced criminal charges related to those settlements, a lack of prosecution that has been condemned by many Congressional members.
“The blame for Purdue’s dangerous sales tactics rests squarely with the Sackler f amily,” said Rashida Tlaib, DMichigan. “If someone, Mr. Sackler, in my district was caught flooding my district with opio ids, we know damn well that they would be tried and locked up. They would be thrown into jail. … You’re using our bankr uptcy process and ever ything to walk free.”
Committee members also assailed the Sacklers in response to committee findings and bankr uptcy court records showing that from 2008 through 2017 withdrawals worth more than $ 10 billion were made from the company that benefited the Sacklers.
“They took the 2007 settlement (also with the Justice Department) as a signal that they should withdraw even more money from Purdue, hoping to get as much money
out as possible, as quickly as possible — all so that they could prevent the money from go ing to the victims and sufferers from the opio id crisi s, ” Maloney said.
Later in the hearing, Maloney said the Sacklers had “taken money out of the company so it would be forever beyond the legal reach of the people they were harming. They are the Bernie Madoffs of medicine.”
Representatives for the Sacklers have said that more than half of those transfers were paid in taxes and would be reinvested in businesses that would be sold as part of Purdue’s proposed settlement of the lawsuits.
In addition, several committee members pilloried the company’s bankr uptcy process. The firm has offered to settle the lawsuits with a proposal it values at more than $ 10 bil l i on. It would have the Sacklers relinquish control and restr ucture Purdue into a “public benefit company.” Twenty-four states including Connecticut have rejected that plan.
“I’m just sick to see, what appears to me, is a f amily and company that’s go ing to use the bankr uptcy process to get out of this and continue to be one of the wealthiest companies in America,” said Rep. James Comer, R-Kentucky, the committee’s ranking member. “It’s unacceptable. I’m just sickened the more I read about the actions of Purdue Pharma.”
At the end of the hearing, Maloney indicated that the committee would continue to investigate the company and the Sacklers. The subsequent measures, she said, would include the witnesses providing a “full accounting of shell companies owned by the Sackler f amily” and the public disclosure of “all documents in the Sackler f amily’s possession.”
“The committee will not allow you to continue hiding from your part in this devastation. You have played a crit i cal and active role in sparking and fueling the opio id epidemic,” Maloney said in her closing comments. “You have the ability now to mitigate at least some of the damage you caused. … Make a massive financial contribution that leaves no doubt about your commitment. And finally, acknowledge your wrongdo ing. The f amilies and communities whose lives have been r uined deser ve at least that much.”