Why Are Two Pharmaceutical Companies Based in Ireland Caught Up In US Opioid Crisis?

Documents unsealed by a federal judge in Ohio show three companies - none of them household names - were behind the production of billions of opioid painkillers which flooded the US market between 2006 and 2012.

Previously the bad publicity for the opioid crisis in the United States had been focused on Purdue Pharma, which makes OxyContin, and Johnson & Johnson - who are on trial in Oklahoma over their marketing of two drugs, Nucynta and Duragesic.

Purdue, who are owned by the Sackler family, invented the powerful opioid painkiller OxyContin in 1996 and have been accused of driving up demand with deceptive marketing.

​But attention is now switching to the makers of generic opioid painkillers who sold drugs which were similar to OxyContin, but cheaper, to doctors and hospitals across the US.

In October Judge Dan Polster will preside over a consolidated lawsuit in Ohio in which 1,200 US counties are suing Purdue and 22 other firms in the pharmaceutical industry, including wholesale distributors McKesson and Cardinal Health.

​The lawsuit claims “the manufacturers of prescription opioids grossly misrepresented the risks of long-term use of those drugs for persons with chronic pain, and distributors failed to properly monitor suspicious orders of those prescription drugs - all of which contributed to the current opioid epidemic.”

Paul Farrell, a lawyer with Greene, Ketchum, Farrell, Bailey & Tweel, told NPR: "I don't think America truly understands the scope and depth, the level of penetration these pills had in their communities. It's going to be an awakening."

​During legal argument in the run up to the trial Judge Polster decided to unseal secret documents which outlined key decisions made by Big Pharma during the period 2006 and 2012, when the crisis was taking off.

On 23 July the documents became public and journalists trawling through hundreds of pages have discovered the importance of three companies which had previously remained under the radar.

In an article syndicated across North America, Washington Post reporters Aaron C. Davis, Shawn Boburg and Robert O’Harrow, said the vast majority of the 76 billion opioid tablets produced between 2006 and 2012 were made by three companies.

​They were SpecGx, Par Pharmaceutical and Actavis.

Actavis is owned by Israel-based Teva Pharmaceutical Industries but both SpecGx and Par are owned by Irish companies.

Mallinckrodt owns SpecGx and Endo Pharmaceuticals owns Par.

So who are these little-known companies which are accused of being behind so much misery in the US?

In 1840 Emil Mallinckrodt built his first factory in St Louis, Missouri and began producing pharmaceuticals.

His sons grew the company and in 1898 they began producing morphine and codeine, which are still heavily used as painkillers.

​In 1982 Mallinckrodt was bought by the giant cosmetics firm Avon and was later sold on to Tyco International, which renamed it Covidien.

In 2013 Mallinckrodt Pharmaceuticals spins off from Covidien, becoming an independent company worth US$2 billion.

Mallinckrodt has 3,500 employees and although its company headquarters is in Dublin, much of its production remains in Missouri.

Earlier this year the company said it planned to spin off its generics business which generated revenue of $839.5 million in 2017 - as a separate company, Sonorant Therapeutics.

But last week they put the spin-off on hold because potential lawsuits stemming from the opioid crisis have undermined its future cashflow.

​On its website Endo says it is a “highly focused generics and specialty branded pharmaceutical company delivering quality medicines through excellence in development, manufacturing and commercialization.”

“Through our operating companies – Endo Pharmaceuticals, Par Pharmaceutical and Paladin Labs – Endo is dedicated to serving patients in need,” it adds.

Endo’s headquarters are in the Republic of Ireland but its main manufacturing centres are in Malvern, Pennsylvania, and Chestnut Ridge, New York.

Endo bought Par for $8 billion in 2015 from private equity firm TPG, who had bought the business only three years earlier for $1.8 billion.

​At the time of the sale to Endo, Todd Sisitsky, managing partner of TPG Capital North America, said the company’s product pipeline had seen "significant growth" since 2012.

It is not clear yet whether Mallinckrodt, Endo or Teva will face trial like Johnson & Johnson, which is accused in Oklahoma of deceptively marketing painkillers and downplaying the risk of addiction.

Johnson & Johnson denies any wrongdoing and says it marketed products responsibly.

Mallinckrodt, Endo and Teva have not commented publicly on the opioid epidemic or their alleged roles in it.

Purdue pleaded guilty in federal court in 2007 to fraudulently marketing OxyContin as a drug that was not addictive and had few side effects. They agreed to pay US$635 million in a settlement.