Business focus: Questions over elite family's drug wealth spread to the UK

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The Sackler family, an Anglo-American business dynasty with a £10 billion fortune, like to put their stamp on things.

Walk into any of the capital’s most famous art galleries, theatres or museums and it won’t be long before you see their name.

The British arm of their charitable foundation has gifted more than £50 million to some of London’s cultural gems since 2010, including the Old Vic, the National Portrait Gallery and the Victoria & Albert Museum, making the family one of the top 20 philanthropists in the UK last year.

All of this has burnished their civic credentials. But now the Sacklers, ranked as the 19th-richest family in America by Forbes, are facing widespread accusations that the source of their fortune is tarnished by the worst drug crisis in US history. 

That’s because the Sacklers owe their wealth in part to a blockbuster painkiller called OxyContin, which was created, launched and marketed by their family firm, Purdue Pharma, and is blamed by some for contributing to the epidemic of painkiller addictions that has swept through America.

Purdue has been accused of marketing the powerful opiate too aggressively, resulting in doctors prescribing the medicine in industrial quantities.

It is a claim that is vigorously denied by Purdue, although the company did settle a major criminal and civil case in 2007 over its sales practices from 1995 to 2001, paying $630 million after pleading guilty to misbranding the drug.

Purdue said it accepted responsibility for the actions of some of its employees but had since “strictly limited and monitored the marketing” of opioid drugs and “imposed strict internal compliance programs”.

The settlement has not stopped other cases — some of them arguing that bad practices continued after 2001 — being brought against it.

It is defending a lawsuit from the state of Ohio, arguing the case should be thrown out because the US drug regulator approved OxyContin for use as a painkiller and approved its warnings, and that the lawsuit has failed to identify any specific harm from its marketing of the drug.

While the Purdue cases have caused a storm of negative publicity in America, the controversy now threatens to throw the family’s UK operation, Napp Pharmaceutical, into the glare.

Sackler Trust’s grants


University of Sussex: £6m

Moorfields Eye Hospital: £3m

Royal College of Art: £2m

Univ of Edinburgh & Glasgow: £1.5m

The Ashmolean Museum (2 grants): £1.1 million

National Portrait Gallery: £1m

Royal Opera House: £2.5m

University College, London: £1.4m

The National Gallery: £1m

The Courtauld Institute of Art: £1m

The Defence and National Rehabilitation Centre: £1m

MK Gallery: £1m

Royal Botanic Gardens, Kew: £1m

Tate Modern: £1m

Cambridge-based Napp, owned by the Sackler family since the Sixties, specialises in asthma drugs and painkillers, including OxyContin.

The business turned over £288 million last year and paid £19.5 million in dividends to the Sackler family shareholders and an offshore trust, also thought to be owned by them, in the British Virgin Islands. 

Napp and Purdue have separate management and operations, and the UK business is far more tightly regulated under the NHS than its American counterpart. But Napp, too, has faced criticism for its marketing of opium-derived drugs. 

One was Targinact, a slow-release painkiller like OxyContin, whose opioid status means it is deemed a controlled substance.

A pharma expert complained in 2009 that a slide on a Napp-sponsored website had suggested patients could be simply switched from rival painkillers co-codamol and tramadol to Targinact.

The person said the presentation’s claims were inflated because the Napp drug was not an equivalent as claimed, and Napp had failed to highlight adequately that Targinact was a controlled substance. At the time, neither co-codamol or tramadol were.

The Prescription Medicines Code of Practice Authority (PMCPA) ruled the slide’s claims — and a leaflet distributed to doctors that repeated them — were “misleading”.

It declared that high standards had not been maintained, and the literature breached its rules on promotional material, but it ruled against the controlled-substance claim. 

Napp said the failure to include some information on Targinact on one part of the presentation was an oversight, that the PMCPA had acknowledged patients were not put at risk and  it “cannot be characterised as aggressive marketing”.

It also said any suggestion that it acted inappropriately in its marketing of opioids in the UK would be completely false. It added that it had not actively promoted them for several years and, when it did, its activities were responsible and balanced.

In the UK in 2001, the Office of Fair Trading fined it for the way it maximised the market share of a delayed-release morphine called MST, used for pain in cancer patients.

The regulator found Napp had been artificially discounting the price of the drug in hospitals to stave off competitors while charging excessive prices to outpatients receiving it from their GPs.

Winning the hospital business was vital for Napp because GPs tend to follow the lead of the specialists’ prescriptions. Napp cut the price of hospitals’ MST by 90% or more to discourage them from moving to competitors.

The price of MST from GPs was 10 times higher than in hospitals. As rivals dropped out, MST ended up with a market share of more than 90% of delayed-release morphine in 1999 — despite the drug’s patent having expired seven years earlier.

The OFT declared the practice “abusive” and fined Napp £3.2 million, reduced to £2.2 million on appeal. Napp said this week that there had been no suggestion that it had made any misleading or inappropriate marketing claims about its medicines, and the regulator did not accuse it of aggressive marketing practices.

While these UK breaches were far less serious than the allegations against Purdue in the US — and opiates can help in end-of-life care — they raise further questions surrounding the governance of Sackler medicines companies. 

Seven family members — including Dame Theresa Sackler, the British widow of one of Napp’s founders — are non-executive directors at Napp. She helps with the Sacklers’ UK charitable trust although she has no operational responsibilities for Napp itself.

Napp has paid the family more than £200 million in dividends over the past 10 years. 

With the US press highlighting the opiate epidemic claims, British charities and institutions benefiting from Sackler family largesse have been placed in a difficult position.

The UK donations in particular have sparked anger from US campaigners, who say the family fortune should go to funding addiction treatment in the US, not museums in London. 

London roots 


Oxycontin, a slow-release opioid said to allow people in severe pain to get pain relief over 12 hours, was invented after technological breakthroughs by Napp here in London in the late Seventies. 

A request from St Christopher’s Hospice for a time-release morphine system to help patients sleep through the night led to the creation of the “contin” system. MS Contin, its first iteration, was launched in the mid-Eighties.

A decade later, OxyContin, a slow-release version of oxycodone, was launched after the MS Contin patent ran out.

Sales of OxyContin in the US ballooned from $45 million in 1996 to nearly $3 billion over 2001 and 2002.

According to investment bank Bernstein, Purdue sold $2.4 billion worth of opioids last year — nearly five times higher than its closest rival.

Campaigner Ryan Hampton, a former Clinton administration staffer who got hooked on opiates after he was prescribed them for an ankle injury, said the Sacklers should “take action” but instead “they are off halfway across the world, using the money on donations to the arts”.

Sir Mark Rylance, actor and former artistic director of the Globe theatre called on the venue to stop accepting their money.

Purdue said it supported efforts to prevent opioid abuse. Napp said it recognised risks around opiates and implemented preventative measures.

Some recipients of Sackler largesse are quick to defend the family.

The Old Vic, which received a £2 million grant from the Sackler Trust in 2014, called its support “valued”. The University of Glasgow, which took £1 million in 2013 for a psychobiology centre, said this donation had “saved lives”. 

The Sackler family declined to comment. Their name is still dotted across a panoply of London institutions. It’s a name likely to be getting more attention in the months to come.

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November 16, 2017 |
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