December 16,2020

Wyden, Grassley Call for Greater Drug Industry Transparency in Report Exposing Opioid Makers’ Ties to Tax-Exempt Groups

Bipartisan Investigation Identifies $65 million in Payments Made to a Handful of Groups Focused on Pain Issues by Manufacturers of Opioids and Opioid-Related Products

Washington, D.C. – Senate Finance Committee Ranking Member Ron Wyden, D-Ore., and Chairman Chuck Grassley, R-Iowa, today issued a report to committee colleagues illuminating the extensive connections between opioid manufacturers and opioid-related products, and tax-exempt entities that have helped drive up sales while downplaying the risks of opioid addiction.

In June 2019, the senators sent letters requesting and collecting financial data including grant contracts, audits and IRS Form 990s from 10 tax-exempt groups working on pain issues, along with information about their advocacy activities, and the advocacy activities of their officers and board members. Using this data, the Finance Committee leaders exposed the financial relationships between opioid manufacturers and these organizations in a detailed letter to their committee colleagues that:

  • Identified $65 million in payments from manufacturers of opioids and opioid-related products (for example, therapies to treat opioid use disorder, opioid overdoses, or opioid-induced constipation) to such groups since 1997, including nearly $30 million since 2012;
  • Released hundreds of pages of internal documents demonstrating the business motivations of the donations companies made to tax-exempt groups, and the close relationships that were maintained between companies and the groups they funded;
  • Provided detailed data showing payments the groups received from drug companies; and
  • Further explains the relationships with three case studies involving the American Chronic Pain Association, Americans for Patient Access, and the International Association for the Study of Pain, each of whose work appears to have echoed and amplified the business interests of their pharmaceutical donors.

Wyden and Grassley found that these opioid manufacturers viewed these tax-exempt organizations as helpful extensions of their sales and marketing efforts. Based on the investigation and their findings, the senators make two recommendations to improve transparency:

  • Expand CMS’s Open Payments database to require pharmaceutical manufacturers and device manufacturers to report payments made to tax-exempt organizations;
  • Require the Secretary of HHS to develop guidelines and procedures to increase transparency among members of Federal task forces, as well as research groups and panels convened or contracted by HHS.

“Our bipartisan investigation shows how pharmaceutical companies use tax-exempt groups to help seed the market for their products by shaping the views of patients, doctors and policymakers,” said Wyden. “The potential dangers presented by opioids makes this Trojan horse-style of marketing particularly troubling, but make no mistake that such practices are widespread across the pharmaceutical industry, and consumers are often left in the dark. I look forward to working with Senator Grassley and our Finance Committee colleagues to pass into law important reforms that provide consumers with more visibility of the financial relationships between drug companies and tax-exempt organizations.”

“Tax-exempt advocacy organizations like the ones we looked at are created with good intentions. They can be forces for good, advocating and highlighting issues that might not otherwise receive the warranted attention,” said Grassley. “But we’ve found that the possibility of donor influence could and has undermined the efforts to develop and advocate good policy. When it comes to opioids, we need to make sure there is transparency and accountability to prevent what, in this case, led to serious public misunderstanding of the risks of these highly addictive drugs.” 

This inquiry builds on a previous bipartisan investigation in 2012 led by then-Senate Finance Committee Chairman Max Baucus (D-Mont.) and then-Senate Judiciary Committee Ranking Member Grassley. That investigation likewise raised concerns about the millions of dollars opioid manufacturers paid to tax-exempt groups like the American Pain Foundation and American Pain Society. In the years leading up to that investigation, those groups made claims like “most pain sufferers are under-medicated” and “many [physicians] are reluctant to prescribe opioids because they mistakenly think their patients will become addicted to the drug...” Wyden has also repeatedly raised concerns regarding financial ties of pain groups with opioid manufacturers.

The full text of the report is available here.

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