Empire of Pain: The Secret History of the Sackler Dynasty

by Patrick Radden Keefe

Over the previous six decades, Kathe Sackler’s family had left its mark on New York City, in a manner that the Vanderbilts or the Carnegies once did. But the Sacklers were wealthier now than either of those families that traced their fortunes to the Gilded Age.

The Sacklers had given away hundreds of millions of dollars, and for decades the Sackler name had been associated in the public mind with philanthropy.

the precise origins of the Sacklers’ wealth had, for a long time, been more mysterious.

you could scour Purdue Pharma’s website and find no mention of the Sacklers whatsoever. But Purdue was a privately held company entirely owned by Kathe Sackler and other members of her family. In 1996, Purdue had introduced a groundbreaking drug, a powerful opioid painkiller called OxyContin, which was heralded as a revolutionary way to treat chronic pain. The drug became one of the biggest blockbusters in pharmaceutical history, generating some $35 billion in revenue.

Arthur had discovered that of all his many talents one thing he was particularly good at was selling things to people.

“It almost seems as though society has anesthetized itself or deluded itself with the belief that such intense individual suffering and such mass destruction of human talents and capacities does not exist—because we have put it behind hospital walls,” Arthur reflected at the time.

there was something about Arthur Sackler—his life force, his won’t-take-no-for-an-answer tenacity, his vision. When you were with Arthur, Marietta came to feel, it seemed as if anything were possible. There was no such thing as an insurmountable obstacle. In fact, by the time Marietta learned that Arthur Sackler, the man she had been seeing, already had a wife and two children, Arthur treated it as a mere detail, a minor technicality that should not slow the two of them down.

When they injected forty patients who had been diagnosed as schizophrenic with histamine, nearly a third of them improved to a degree where they could be sent home. Some patients who had not responded to any other course of treatment did respond to histamine. Drawing on this research, the Sackler brothers proceeded to publish more than a hundred medical papers. Their aim was, as they put it, to trace “the chemical causes of insanity.” With his unusual experience as an editor, a marketing director, and an adman, Arthur knew how to attract breathless press coverage.

There was a sense, in their press clippings, that this trio of brothers at a mental hospital in Queens might have stumbled upon a solution to a medical riddle that had bedeviled societies for thousands of years. If the problem of mental illness originated in brain chemistry, then perhaps chemistry could provide the solution. What if, in the future, the cure for insanity was as simple as taking a pill?

in the early 1940s, the introduction of penicillin ushered in a new era of antibiotics—powerful medications that can stop infections caused by bacteria. When the war broke out, the U.S. military needed great quantities of penicillin to administer to the troops, and companies like Pfizer were enlisted to produce the drug. By the time the war ended, the business model of these chemical companies had forever changed: now they were mass-producing not just chemicals but finished drugs, which were ready for sale. Penicillin was a revolutionary medicine, but it wasn’t patented, which meant that anyone could produce it. Because no company held a monopoly, it remained cheap and, thus, not particularly lucrative. So Pfizer, emboldened, began to hunt for other remedies that it could patent and sell at a higher price.

Terramycin wasn’t a particularly groundbreaking product, but it became a huge success because it was marketed in a way that no drug ever had been. It was Arthur Sackler who would be credited not just with this campaign but with revolutionizing the whole field of medical advertising.

In 1955, the annual intake of patients to American psychiatric facilities declined for the first time in a quarter of a century. The coming decades would witness the great deinstitutionalization of the mentally ill in America, as the wards at asylums like Creedmoor began to empty out. The success of Thorazine was hardly the only factor driving this seismic change, but it did seem to substantiate the theory to which Arthur subscribed—that mental illness was caused by brain chemistry, rather than immutable genetic tendency or a traumatic upbringing or flawed character. In fact, Thorazine created a whole new research agenda for scientists: if you could address mental illness by tinkering with chemical deficiencies in the brain, surely there were other afflictions that could be cured in a similar fashion.

one of the entities in which Arthur possessed a clandestine stake was his ostensible rival, the L. W. Frohlich agency. To the outside world, Sackler and Frohlich were competitors. But the truth was, Arthur had helped Frohlich set up his business, staking him money, sending him clients, and, ultimately, colluding with him in secret to divvy up the pharmaceutical business.

The challenge was that because of conflict of interest rules no single agency could handle two accounts for competing products. “So what they did was, they set up two agencies,”

“Change the molecules a little,” his superiors told him. Make something different enough that we can patent it and charge a premium to sell a competing product, but not so different that we won’t be able to muscle in

Valium was the first $100 million drug in history, and Roche became not just the leading drug company in the world but one of the most profitable companies of any kind.

Librium and Valium made Arthur Sackler very rich. But even as they were doing so, troubling signs were starting to emerge that the miracle drugs devised by Leo Sternbach at Roche might not be quite so miraculously free from side effects as the advertising campaigns had suggested.

Roche hadn’t just blithely assumed that the powerful drugs it was about to introduce to the public would be safe: the company had deliberately obfuscated evidence to the contrary.

Some individuals just have addictive personalities and are prone to abuse any substance you make available to them. This attitude was typical in the pharmaceutical industry: it’s not the drugs that are bad; it’s the people who abuse them.

As Arthur’s friend and secret business partner Bill Frohlich had observed, the commercial life span of a branded drug is the short interval between the point when you start marketing it and the point when you lose patent exclusivity.

But the original House of Sackler was built on Valium, and it seems significant, and revealing, that for the rest of his life Arthur would downplay his association with the drug, emphasizing his achievements in other areas and deliberately obscuring (or leaving out altogether) the fact that his first fortune was made in medical advertising.

He desired posterity, but not publicity. The last thing Arthur wanted to do was call attention to his own wealth and holdings, and do so in a manner that might raise questions about his overlapping careers.

In January 1959, Lear published the initial results of his investigation in a Saturday Review article called “Taking the Miracle Out of the Miracle Drugs.” In stark contrast to the euphoria that generally accompanied public discussion of antibiotics, Lear suggested that these drugs were being wildly overprescribed, often without any firm medical basis for doing so, and that the ubiquity and sophistication of pharmaceutical advertising shared some of the blame.

The notion that the FDA actually protects American consumers was nothing but a comforting myth.

Someone at Pfizer had dreamed up the line, he explained, as a marketing “theme” for Sigmamycin. It wasn’t that Pfizer admired the FDA man’s sound bite so much that they borrowed it for their ad copy. The company had insinuated its own ad copy directly into the speech.

The investigators identified no fewer than twenty separate corporate entities that were linked to the building.

“The Sackler empire is a completely integrated operation,” Blair wrote. They could develop a drug, have it clinically tested, secure favorable reports from the doctors and hospitals with which they had connections, devise an advertising campaign in their agency, publish the clinical articles and the advertisements in their own medical journals, and use their public relations muscle to place articles in newspapers and magazines.

Arthur liked limbo. He thrived on it. He’d built a life around fuzzy boundaries, overlapping identities, conflicts of interest. Limbo was his element.

He made the Forbes 400 list in 1986; the magazine estimated that he was worth “$175 million plus.”

Arthur Sackler liked to opine that the problem with midsized pharma companies was that they often had no research and development capacity with which to discover new drugs.

Napp had been acquired by the Sacklers in 1966,

Napp had recently developed a special coating system for pills that allowed the diffusion of a drug into the bloodstream of a patient to be carefully regulated over time. They called the system Continus, and they had already used it for an asthma drug. But what if you applied it to morphine? It would mean that a patient could swallow a pill and the morphine would slowly release into the body, in the same manner that it would on a drip. The new drug, which would become known as MS Contin, was released in the U.K. in 1980, and it was a breakthrough.

Having developed this drug in England, under Mortimer, the Sacklers’ next step would be to market it in Raymond’s domain, the United States. But this raised an interesting dilemma. The Sacklers were committed to the narrative that MS Contin was new, even revolutionary. But the FDA’s procedures for securing approval of any new drug required a lengthy and cumbersome regulatory application process. What if the company asserted that this wasn’t actually a new drug at all? The only active ingredient was morphine, an old and familiar drug that had long since been approved. Really, it was just the distribution mechanism that had changed.

So without alerting the FDA, much less asking for permission, Purdue started manufacturing MS Contin at a plant in New Jersey and offered it for sale in October 1984.

MS Contin would go on to generate $170 million a year in sales, dwarfing anything that Purdue Frederick had sold in the past.

Arthur’s heirs ended up selling their one-third stock interest in Purdue Frederick to Mortimer and Raymond for $22 million. In light of what the company was about to become, this was, for Arthur’s heirs, a spectacularly foolish transaction.

there’s another reason that drug companies charge such high prices: the monopoly granted by the patent is only temporary. Once you have received a patent, you generally have twenty years in which to market the product exclusively, though in practice it is often less time, because the patents tend to be issued before FDA approval. After the patent expires, any other company can make its own generic version and sell the drug at a cheaper price. You’ve made it easy for them to do so—by publishing the formula in exchange for your patent.

generic competition was a reality that any drug company would be forced to contend with: a horde of competitors just watching the calendar and waiting for the moment when the patent exclusivity is set to expire. As Bill Frohlich had declared back in 1960, there is a limited window in which a maker of branded drugs can reap outsized profits.

There was a movement under way in American medicine to reexamine the treatment of pain. An emerging cohort of doctors was arguing that for too long the medical profession had overlooked pain, thinking of it merely as a symptom of underlying conditions and not as an affliction that merited serious clinical attention itself.

Because morphine had long been perceived as a drug with a high risk of addiction, physicians reserved it for particularly severe cases. Consequently, patients and their families were often reluctant to have doctors prescribe morphine, because in the popular imagination it was seen, as Richard put it, to be “a death sentence.”

Now this is fentanyl

Romagosa asserted that fears of people becoming hooked on morphine had been overblown, because addiction “is a psychological malady” and only occurred when morphine was misused by “those who do not need it.” For the Sacklers, this was a helpful message.

When Purdue Frederick released MS Contin in the United States, it became an enormous success, changing the fortunes of the company.

“MS Contin may eventually face such serious generic competition that other controlled-release opioids must be considered,” he wrote. If Purdue was going to lose the monopoly on its flagship painkiller, perhaps it would be possible to use the Contin time-release system as a delivery mechanism for other opioids, in order to secure new patents.

The challenge was to find a successor to MS Contin. The real innovation in MS Contin was not the morphine but the Contin system, so they had been talking about other drugs that could be used with that system.

Kathe suggested using oxycodone, an opioid that had been synthesized in Germany in 1917.

oxycodone was much more potent than morphine. The drug was already widely available as a painkiller, in mild treatments like Percodan and Percocet. But there was only a small amount of oxycodone in those pills, because in Percodan it was mixed with aspirin and in Percocet it was mixed with acetaminophen, both of which can be toxic if a person takes too much of them. If you deployed pure oxycodone using the Contin system, however, it might be possible to administer a larger dose that would filter slowly into the bloodstream, allowing the patient to take a more formidable quantity.

Gone were the days when Purdue was content to be a sleepy manufacturer of laxatives and earwax remover. What was required now, Richard believed, was “a new aggressiveness.”

“We believe that the FDA will restrict our initial launch of OxyContin to the Cancer pain market,” Friedman wrote. But what if, over time, the drug extended beyond that? There was a much greater market for other types of pain: back pain, neck pain, arthritis, fibromyalgia. According to the wrestler turned pain doctor John Bonica, one in three Americans was suffering from untreated chronic pain. If that was even somewhat true, it represented an enormous untapped market. What if you could figure out a way to market this new drug, OxyContin, to all those patients? The plan would have to remain secret for the time being, but in his memo to the Sacklers, Friedman confirmed that the intention was “to expand the use of OxyContin beyond Cancer patients to chronic non-malignant pain.”

the Sackler family made its first great fortune was with Arthur’s involvement in marketing the “minor” tranquilizers Librium and Valium. Thorazine was perceived as a heavy-duty solution for a heavy-duty problem, but the market for the drug was naturally limited to people suffering from severe enough conditions to warrant a major tranquilizer. The beauty of the minor tranquilizers was that they were for everyone. The reason those drugs were such a success was that they were pills that you could pop to relieve an extraordinary range of common psychological and emotional ailments. Now Arthur’s brothers and his nephew Richard would make the same pivot with a painkiller: they had enjoyed great success with MS Contin, but it was perceived as a heavy-duty drug for cancer. And cancer was a limited market. If you could figure out a way to market OxyContin not just for cancer but for any sort of pain, the profits would be astronomical. It was “imperative,” Friedman told the Sacklers, “that we establish a literature” to support this kind of positioning. They would suggest OxyContin for “the broadest range of use.”

if Purdue wanted to market a powerful opioid like OxyContin for less acute, more persistent types of pain, one challenge would be the perception, among physicians, that opioids could be very addictive. If OxyContin was going to achieve its full commercial potential, the Sacklers and Purdue would have to undo that perception.