AP NEWS

Purdue Pharma’s local partnerships face growing scrutiny

March 15, 2019

STAMFORD — Hildene Capital Management recently cut ties with the owners of Purdue Pharma. But so far, the hedge fund’s decision has not sparked a trend.

As Purdue faces more than 1,000 lawsuits tied to its allegedly deceptive marketing of drugs such as OxyContin, organizations including the Stamford Downtown Special Services District, Mill River Park Collaborative and Palace theater have shown no signs of disavowing their support from the company or from the members of the Sackler family who own the firm. Their stance parallels other beneficiaries’ tepid responses to the widespread outrage against Purdue. It is also a position that risks alienating key supporters.

“Ever since I learned the facts about the lawsuits, the numbers of (opioid) deaths and Purdue’s marketing tactics, I became very concerned about the board’s inactivity,” said Fernando Luis Alvarez, a Stamford art-gallery owner and DSSD board member, who was arrested last June for his role in a “spoon” protest outside Purdue’s headquarters in downtown Stamford.

Purdue did not make any officials available for an interview for this story. Instead, it issued a statement about its support of nonprofits.

“For many years, Purdue’s proudly supported more than 125 different organizations and their important efforts to help make Connecticut a better place,” the statement said, in part. “The organizations we support range from education, disaster relief, feeding the hungry and numerous other critical initiatives for the state and our community.”

Going separate ways

Hildene told investment entities of Sackler family members late last year that the firm was no longer comfortable managing their money.

Investment managers’ ties to clients who are linked to the opioid crisis have come under greater scrutiny in recent years — paralleling controversies, in the 1980s, about their connections to apartheid-era South Africa and, in the 1990s, their business with the tobacco industry.

“This is yet another manifestation of an inclination among asset managers to say there are some people and organizations they don’t want to be involved with,” said Lawrence J. White, a professor of economics at New York University. “This isn’t the first time this sort of thing has happened, and it surely won’t be the last.”

Officials at Westport-based Bridgewater Associates, the world’s largest hedge fund by assets under management, were not available to comment on whether they have investments with the Sacklers. AQR Capital and Viking Global investors, the next two-largest hedge funds in the state that are both based in Greenwich, declined to comment.

Maintaining ties

Purdue ranks as one of the city’s most-prominent corporate supporters of Stamford-based community organizations.

The company has given between $500,000 and $1 million to the Mill River Park Collaborative, the nonprofit that oversees the downtown park, according to the organization’s website. A glade in the north end of the revitalized park is named after the firm, which is a lead sponsor of the MRPC.

Messages left this week for MRPC officials were not returned.

Diana Lenkowsky, vice president of facilities and administrative services for Purdue, is a vice chairwoman of the MRPC’s board. She also serves on the boards of the DSSD and Palace theater.

Purdue declined to make Lenkowsky available for an interview.

In the DSSD’s 2017-18 annual report, Purdue is listed as one of the property owners that gave donations and in-kind sponsorships, in addition to paying a tax assessment to help fund the organization.

The report does not specify how much Purdue gave to DSSD, whose community and economic-development programs include the Alive@Five summer-concert series.

“It completely undermines the DSSD’s mission, in my opinion,” Alvarez said of Purdue’s support. “Organizations that represent the public and community, who are taking money from corporations and governments, should bear the responsibility to play in the best interest and safety of the community rather than their own vested interest.”

Some local elected officials have raised similar concerns. DSSD’s and MRPC’s funders include Stamford’s local government.

“I personally believe those public-private partnerships should no longer be taking any more money from Purdue — at least until we see the outcome of the Connecticut lawsuit against Purdue,” said Nina Sherwood, a Democrat who represents the city’s eighth district on the Board of Representatives. “Once they take the money, then they’re advertising for the company. They’re also potentially compromising the city’s ability to hold those businesses such as Purdue accountable and protect the people from their ‘bad acting.’”

Messages left for DSSD President Sandy Goldstein were not returned.

At 61 Atlantic St., the Palace theater has an art gallery that is named after Arthur Sackler, who died in 1987. He was a brother of the late Raymond and Mortimer Sackler, who bought Purdue’s predecessor company in 1952.

No living Sacklers have recently made donations to the Palace, according to the organization’s executive director, Michael Moran Jr. He declined to comment further on the Palace’s connections to the Sacklers and Purdue.

Stamford Mayor David Martin, who is a DSSD and Palace board member, was not available to comment.

In contrast with Connecticut’s attorney general and many other Connecticut cities — including Bridgeport, Danbury, New Haven, Norwalk and Waterbury — Stamford’s municipal government has not filed a lawsuit against Purdue. Martin has not ruled out litigation, but he has questioned the impact of Stamford’s filing or joining a complaint.

The philanthropy of the Sacklers — whose combined net worth has been estimated at $13 billion — extends well beyond Stamford.

Other major Connecticut-based beneficiaries include the University of Connecticut, Yale University and Greenwich Hospital. Those organizations have not publicly criticized the Sacklers, either.

In contrast, Connecticut’s Democratic Party recently denounced more than $100,000 in Sackler contributions that it has received in recent years.

“I’m glad that the Democratic Party, on the state level, is no longer interested in taking Purdue Pharma/Sackler money,” said Megan Cottrell, a Democrat who represents the fourth district on the Board of Representatives. “Other organizations, locally, should consider distancing themselves as well, but that is each individual organization’s call to make.”

pschott@scni.com; 203-964-2236; twitter: @paulschott