Politics & Government

Drug industry backing groups spending millions in Kentucky’s attorney general race

No issue plays a bigger role than drugs in Kentucky’s attorney general race, which voters will decide Tuesday.

Republican Daniel Cameron and Democrat Greg Stumbo both pledge to pursue nine opioid addiction lawsuits that were filed against pharmaceutical manufacturers and distributors by outgoing Attorney General Andy Beshear. Each vows to be tougher than the other, holding drug companies accountable in court for the harm they allegedly have done to Kentuckians.

But behind the scenes, millions of dollars are being spent in Kentucky by outside groups to boost the campaigns of Cameron and Stumbo, drawing on hefty donations from the pharmaceutical industry — including some of the same drug companies that have been sued by Beshear’s office, such as Pfizer and Mallinckrodt.

The Republican Attorneys General Association and the Democratic Attorneys General Association are political nonprofits in Washington that raise large sums from wealthy donors to assist in their parties’ statehouse races around the country. Those contributors get to rub shoulders with attorneys general during private retreats held by RAGA and DAGA at luxury resorts.

According to tax filings and interviews, during the first half of 2019, RAGA and DAGA collected $372,300 and $340,000, respectively, from drug companies involved in litigation with Beshear’s office or their lobbying organizations, such as the Pharmaceutical Research and Manufacturers of America.

Until this year, one of the groups’ top donors was Purdue Pharma, maker of prescription painkiller OxyContin. From 2014 to 2018, even as it was being sued by Kentucky and many other states over the opioid addiction crisis, Purdue Pharma gave $210,000 to DAGA and a far larger amount, $680,000, to RAGA.

The Sackler family, which owns Purdue Pharma, employs Luther Strange, a former Republican Alabama attorney general and RAGA chairman, to represent it in ongoing settlement talks with more than two dozen states in a deal that could be worth up to $12 billion. The Republican attorneys general have wanted to settle the case on Purdue Pharma’s terms, while their Democratic counterparts have argued for more, including the need to hold members of the Sackler family personally accountable.

All of this drug money plays a critical part in state elections.

With only three attorneys general races on the nation’s ballots this year — in Kentucky, Louisiana and Mississippi — RAGA and DAGA have been able to spend $4.52 million and $1.43 million, respectively, on behalf of Cameron and Stumbo, according to state campaign-finance data filed this week. The candidates themselves have raised only a fraction of that sum for their own campaign committees.

Most of the groups’ money goes to broadcast and digital advertising across Kentucky, usually attack ads. RAGA (operating as the “Kentucky Freedom Fund”) runs ads referring to Stumbo as “Scumbo, bought and paid for.” DAGA (as the “People’s Lawyers Project”) runs ads calling Cameron a Washington lobbyist and corporate attorney who can’t be trusted by consumers.

‘A flood of money’

It’s no mystery why corporations getting sued by the states want to help pick the states’ lawyers, said Paul Nolette, a political scientist at Marquette University who studies the increasingly powerful role that attorneys general play in national litigation.

“A lot of this money is about buying access,” Nolette said. “It’s about saying, ‘Let’s be able to present our side of the story to these elected officials and their staffs, not just in court but in a more relaxed setting outside of the courthouse.’”

In 1998, 46 attorneys general reached a $246 billion settlement between the states and the tobacco industry about deceptive cigarette marketing that hooked generations of smokers without adequately disclosing the serious health risks they faced.

Since then, Nolette said, attorneys general joining forces to pursue multi-state litigation have taken the lead on a number of complex problems that no other government agency would address, probably none more important than the current opioid addiction crisis.

Simultaneously, RAGA and DAGA organized as a way for interest groups to funnel huge sums of money into the elections of attorneys general, allowing donations far above the relatively small limits imposed on the candidate committees by state campaign-finance laws. Just from 2014 to 2018, RAGA raised $63.2 million and DAGA raised $27.5 million, according to their tax filings.

“I’ve been pretty critical of this process because the attorney general’s office really is a black box,” Nolette said.

“A.G.s have a lot of discretion in whether or not to prosecute or litigate a case — when and how to settle a case — and it can be hard for anyone outside their office to second-guess them without the same level of access to all of the facts and reasoning involved,” he said. “There is not a lot of transparency.”

“So it is worrisome when you see a flood of money coming into this process for elections,” he added. “It leads you to wonder what influence this money will have. Drug companies and others would not be pouring in $50,000 and $100,000 and $150,000 donations if they did not believe they would be getting something out of it that was well worth the cost. They are not just throwing away their money.”

$50,000 here, $100,000 there

Pharmaceutical industry donors say they don’t expect their money to buy them favorable treatment in court.

For example: Pfizer has paid $50,000 each to RAGA and DAGA in this election cycle, said corporate spokesman Sharon Castillo.

Kentucky’s Office of the Attorney General sued Pfizer in May for allegedly engaging in a scheme to inflate and fix the price of more than 100 generic drugs. But Castillo said it would be “inaccurate and misleading” to suggest that Pfizer’s political donations are intended to influence the outcome of state-filed litigation. The donations are about shaping “public policies,” she said.

“We maintain longstanding relationships with these organizations and we give yearly,” Castillo said. “Engaging with elected officials to educate them about the impact current and proposed public policies have on our ability to meet patient needs is an important and appropriate role for companies in open societies, when conducted in a legal and transparent manner.”

Mallinckrodt is a drug maker that Kentucky’s attorney general is suing for allegedly profiting from its massive sale of opioids to Kentucky doctors and patients while knowing about and misrepresenting their addictive nature. A spokesman referred questions about his employer’s $100,000 RAGA and DAGA donations to the corporation’s website.

There, Mallinckrodt explains that it belongs to political organizations like RAGA and DAGA “to ensure Mallinckrodt’s voice is heard on important policy issues concerning our business, employees and patients.”

Among the other Kentucky pharmaceutical defendants and drug industry trade groups donating to RAGA and DAGA this year are Cardinal Health, the Biotechnology Innovation Organization, the Association for Accessible Medicines, Eli Lilly & Co., Johnson & Johnson, Novo Nordisk and Walgreens.

Candidates deny influence

In a prepared statement, a DAGA spokesman said the group uses the money it collects from the pharmaceutical industry exclusively for administrative expenses, not for campaign-related spending in the states.

Even so, “for Democratic A.G.s, there is no potential conflict of interest,” said DAGA press secretary Brandon Richards.

“No matter the issue — whether it’s tackling the opioid crisis, holding corporations accountable or taking care of our most vulnerable communities — Democratic attorneys general have proven time and again that they do the right thing by the law and for the people of their states.”

Likewise, RAGA said Republican attorneys general have sued drug companies regardless of political donations from the pharmaceutical industry. Oklahoma’s attorney general, Republican Mike Hunter, earlier this year won a $572 million verdict against Johnson & Johnson for that company’s alleged role in the opioid crisis in his state. The state of Oklahoma originally wanted $17 billion in damages.

“Republican attorneys general are champions of the rule of law and ensure a stable and predictable legal and regulatory environment exists,” RAGA spokeswoman Kelly Laco said.

Kentucky’s attorneys general nominees said they would not be influenced by pharmaceutical donations to the partisan groups.

“If elected, I will run the attorney general’s office with integrity and without allegiance to anyone other than the people of Kentucky,” Cameron said.

“I can assure the voters that, unlike Greg Stumbo, I will stay the course in our lawsuits against the drug companies,” Cameron said. “He left the attorney general’s office after a single term (in 2004) to run for lieutenant governor, allowing Purdue Pharma to be let off the hook with a paltry $24 million settlement. That’s shameful, and when I am attorney general, we’ll finish what we start and hold the drug companies accountable.”

Stumbo campaign spokeswoman Meredith Scalos said the Democratic nominee doesn’t want any drug money spent on his behalf.

“While we can’t control who the Democratic Attorney Generals Association accepts money from, Greg has made it clear to them that he does not want them spending one penny of any money from the pharmaceutical industry on his race,” Scalos said.

“As attorney general, Greg Stumbo has made clear from day one his primary reason for entering the race is to continue fighting the opioid epidemic and hold every opioid manufacturer and their distributors accountable in a Kentucky courtroom, where he has actually practiced law for more than 30 years,” Scalos said.

John Cheves is a government accountability reporter at the Lexington Herald-Leader. He joined the newspaper in 1997 and previously worked in its Washington and Frankfort bureaus and covered the courthouse beat.
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