Opioid Factory Provides Jobs, But At What Cost?
The Mallinckrodt pharmaceutical factory is the largest employer in Hobart, New York. It was also the source of millions of generic oxycodone pills that federal investigators say fueled the narcotics epidemic. A rural community grapples with the supply-side of the United States’ problem with pills.
This article appeared originally in 100 Days in Appalachia, a Daily Yonder publishing partner.
The small community of Hobart, New York, is a village divided.
The West Branch of the Delaware River splits it in two — Main Street along the north, and the “industrial district” of Railroad Avenue trailing along to the south. Between the historic Main Street storefronts, you can catch a glimpse of the Mallinckrodt plant, where generic oxycodone tablets are produced in massive quantities.
The pill factory employs hundreds of people, more than Hobart’s population of 441. The factory is easily overlooked and ignored by those in the village, but, to some, its presence there is troubling. Some in the area are thankful for the jobs the pill factory provides — but others worry that a plant that manufactures oxycodone is more curse than blessing.
Waiting for the other shoe to drop
Hobart sits in the town of Stamford, on the northeast border of Delaware County, the fifth most rural of New York’s 62 counties. A Community Health Survey conducted in 2016 showed that the county contains a higher proportion of low-income earners than either the state or the nation.
“We’re struggling like all of the county,” town supervisor Mike Triolo notes. “Mallinckrodt — we’re glad it’s there, but everybody’s waiting for the other shoe to drop. If somebody offers them a better deal, they may not be averse to moving.”
Looking at the Supply Side of Pill Epidemic. Read more.
From farming to pharma
During the last half of the 20th century, farmland in Delaware County declined by more than 70 percent, dropping from 520,000 acres in 1959 to just 145,608 in 2012, the most recent year for which data is available.
In 1966, Dean “Doc” Graham established Graham Laboratories, and began manufacturing generic medications such as acetaminophen in Hobart, with support from business partner and investor Allan Knox.
“We realized farming was going out and to build and sustain our little village, we had to develop whatever resources we had to keep young people here,” Knox told local newspaper The Daily Star in 1996.
“Almost all the employees were local at that time,” Triolo recalled. “And Doc Graham was active in the community — he was a fixture.”
Hobart village historian Jim Meagley, who worked for Doc Graham in the 1970s, remembers packaging pill bottles and compounding acetaminophen at Graham Labs as a summer job.
Doc Graham sold the company in the 1990s to longtime customer Mallinckrodt, then headquartered in St. Louis, which had been manufacturing codeine and morphine for a century.
The facility would become Mallinckrodt’s primary manufacturing and distribution base for dosage pharmaceuticals—including its new product lines of oxycodone and hydrocodone.
The business changed hands a few times in the 2000s, but by the time the pill factory bore the Mallinckrodt name once more in 2013, the company had became one of the largest manufacturers of oxycodone in the nation.
Drugs from Hobart plant fueled opioid crisis
In the summer of 2017, the federal Drug Enforcement Administration announced that Mallinckrodt would pay a $35 million fine to settle a years-long investigation alleging that the company allowed suspicious orders for pills from the Hobart plant to go unchecked.
The Washington Post reported that, in one instance, a single distributor sent more than 40 million tablets of Mallinckrodt oxycodone from Hobart to Florida—more than 2 pills for every man, woman and child in the state. In a 2012 media release, the DEA had reported that Mallinckrodt oxycodone was so common in Florida that drug users asked for it by name.
The company pushed back, arguing that it was not required to monitor what happens “downstream,” in doctors’ offices or pharmacies, when selling to wholesale distributors.
In a statement about the settlement, Mallinckrodt said it is proud of the programs it has developed to prevent prescription medication from falling into the hands of other users.
Drug plant plugs a hole
In 2012, a year-long investigation dubbed “Operation Gold Rush” resulted in the arrest of Dante Darren Major, 35, of Hobart. A source close to the investigation said Major supplied 95 percent or more of the oxycodone powder bought and sold in the Delaware County area.
His source: One employee, who had been sneaking the drugs out of the Hobart plant “a little at a time,” then-Undersheriff Craig Dumond reported.
Major was prosecuted in nearby Otsego County, where District Attorney John Muehl secured convictions on 4 counts of drug trafficking and possession and a sentence of 55 years. The employee charged with stealing the drugs was acquitted. According to Muehl, there is no other explanation for where the drugs originated.
But with Major behind bars, and the company put on notice, things have changed, according to Muehl.
“It completely wiped out the oxycodone,” Muehl said. “There was none left; it was gone. Once they convicted him, we have not seen any oxycodone (powder) since.”
Muehl credits Mallinckrodt for tightening security at the Hobart plant since “Operation Gold Rush.”
According to Muehl, the investigation showed that the drugs were coming out of one of the few areas in the plant where there were no security cameras — a deficiency the company has since corrected.
‘It’s like a secret’
The 2017 settlement, which made national news, made few local waves. The pill factory sits tucked away on Railroad Avenue, drawing little attention from the locals to whom it has become so much scenery.
For Justin Hamm, assistant director of the county’s Alcohol and Drug Abuse Council, the pill factory’s presence as a major employer in the region may also take away some of the stigma surrounding the drugs it produces.
“It desensitizes people to (opioids),” Hamm said. “People become used to it maybe without even realizing it.”
For local writer Kristina Zill, who has collected local lore in a project called “Hobart Stories,” there is a larger question of the value of having a pill factory in Hobart’s back yard.
“At a certain point, you have to ask, ‘What are we doing here?’ We’re making these drugs that are really responsible in part for the opioid crisis that we’re in,” Zill noted. “It is an economic driver, in this area, but this isn’t a righteous livelihood.”
Too little, too late
The relationship between non-medical use of opioid analgesics and heroin use is well established, with one study reporting that nearly 80 percent of recent heroin users started with opioid analgesics, according to a 2016 report created by New York’s Heroin and Opioid Task Force.
A Community Health Survey conducted in 2016 concluded that nearly 40 percent of people seen by the county’s Drug and Alcohol Abuse Services the previous year were using opiates, and that opioid-related emergency department admissions rose at a rate of 15.6 percent between 2010 and 2015.
Hamm said the No. 1 risk factor for opioid use in the region isn’t race, class or education, but something much more personal.
“Someone who uses opioids is someone who’s trying to cope with something,” Hamm said. “Maybe it’s abuse, maybe it’s depression, maybe it’s something going on in their personal lives. And this becomes their way of trying to manage it.”
And for writer Kristina Zill, who has been collecting the stories of Hobart, there is plenty of pain to go around.
“When we ask people, ‘What do you think is the future of Hobart?’ it’s this kind of magical, wishful thinking, of some deux ex machina that’s going to come in and fix all the problems,” Zill said. “There’s a kind of helplessness, and a kind of despair.”
Triolo, though, sees signs of hope. Efforts to brand Hobart as “the Book Village of the Catskills” have drawn attention from national and international publications, and the revival of the Catskills as a trendy spot for New York City weekenders and vacationers is finally beginning to reach the village.
“We’re reinventing ourselves from what was really a farm community into something else,” Triolo said, “and we hope it works.”
Emily F. Popek (@EmilyPopek) is a communications specialist and freelance journalist. She lives in upstate New York with her husband and daughter.