Committed to Fair Play

The job at TAP should have capped Douglas Durand’s pharmacy career, instead he found himself caught in a corporate culture of bribes and kickbacks.

Committed to Fair Play

By Jill ConnorsPhotos By Jim Stem Photography

When Douglas Durand ’74 was a URI student commuting daily from his hometown of Pawtucket, R.I., people never failed to remark about what a long way he traveled to get to college. “It’s that Rhode Island thing where any drive that’s more than 15 minutes a day attracts attention,” he laughs.

When Durand journeyed to Kingston last month to receive the Presidential Award, one of the University’s 2003 Alumni Achievement Awards, the same refrain about traveling a long way was appropriate in terms of moral stamina, not just mileage.

For Douglas Durand has gone from pharmacy major to pharmaceuticals sales executive to corporate whistleblower to multimillionaire. His 1996 lawsuit against his former employer, TAP Pharmaceutical Products, Inc., prompted a five-year investigation by federal prosecutors and forced TAP to pay an $875 million fine in 2001 in connection with fraudulent drug pricing and marketing conduct. Durand received $77 million of that fine because whistleblowers who file lawsuits against companies defrauding the government are entitled to 15 to 25 percent of recovered funds.

Durand never aspired to be either a corporate whistleblower or a multimillionaire. He grew up in a blue-collar neighborhood in Pawtucket, one of eight children in a family that valued honesty and hard work. His father never went to college but worked himself up from apprentice carpenter to construction superintendent. His mother was a registered nurse who became a stay-at-home mom.

“My parents are the epitome of good solid folk,” says Durand. They sent all eight of their children to college (including Steve Durand ’83), a remarkable accomplishment. “My parents pushed very hard for all the right things,” says Durand. “They laid down the rules: We would all go to state schools, they would pay tuition, and we would pay the other expenses.”

Durand worked throughout his five-year pharmacy program, primarily at the Pawtucket Avenue Pharmacy near his home where he had held a job since he was 16. During his fourth and fifth years of pharmacy school, he entered state politics. A Democrat, he was elected a state representative from Pawtucket (a position that paid $300 per year), and he served on the House’s Health, Education, and Welfare Committee. For Durand, it was another way to express his commitment to fair play, an ethos that would later turn his career upside down.

After graduation he joined Merck & Co., Inc., a leading pharmaceutical manufacturer, as a salesman. “I had already peaked as a 20-year-old for how many prescriptions I could fill in an hour,” he jokes. He stayed with Merck for 20 years, moving up from sales to management positions all over the country. Durand, his wife, former high school classmate Elizabeth Shanaghan, and their two daughters lived in Philadelphia (twice), Pittsburgh, New Hampshire, Memphis, and New Jersey. In addition, Durand frequently traveled abroad.

Then came the job move that changed his life. In 1995, Durand left Merck and joined TAP Pharmaceuticals Products, Inc., a Chicago-area company that was a joint venture started by Abbott Laboratories and Takeda Pharmaceuticals of Japan to market Lupron, a drug that controlled prostate cancer, as well as a new product, Prevacid for ulcers. The job promised the title of vice president, higher pay, and a chance to settle down in one place. For Durand, then 44, with a spotless record behind him at Merck, it should have been the job that capped his career.

Instead, he hit a stone wall. At least that was the reaction Durand received from colleagues at TAP when he tried to introduce ethics into a corporate culture that he found encouraged kickbacks and gifts. Urologists were routinely given large-screen TVs for their waiting rooms, VCRs, computers, and fax machines. Sales representatives, as well as their managers, did not track their Lupron samples, an oversight that can lead to big fines—after a third offense, the FDA can impose a $1 million fine for just one missing drug sample. And there was talk of giving a two percent “administrative fee” to doctors who prescribed Lupron.

Durand tried to make his sales managers accountable by basing their bonuses on tracking their samples. “I had one manager who went from 50 percent to 95 percent,” says Durand. But TAP made Durand stop that incentive because they felt it wasn’t in keeping with their corporate culture and might hurt morale. And with the two percent “administrative fee” going into effect in spite of his objections, Durand, as a vice-president, felt he could be held responsible for what was essentially a kickback scheme.

It was time for Durand to draw on the values instilled in him by his family. He mailed a binder carrying evidence of the kickbacks and other misbehavior to Elizabeth Ainslie, a Philadelphia attorney and former prosecutor with close ties to the U.S. attorney specializing in medical fraud. Ainslie thought she had a case to sue under the False Claims Act, but it was Durand’s decision to proceed with the lawsuit.

He left TAP in February 1996, took a lower paying and less prestigious position at Astra Merck, a pharmaceuticals company back in the Philadelphia area, and in May 1996, he filed the suit. Then it was a waiting game while the federal investigation was underway, a time when Durand’s identity as the whistleblower was still unknown to TAP.

Finally, in 2001 the government made its case against TAP, and Durand’s years of tense anonymity were over. In October 2001, TAP pleaded guilty to conspiring to violate the Prescription Drug Marketing Act. The company was fined and put on probation. A U.S. District Court said TAP’s actions cost Medicare, Medicaid, and other federal health care programs $145 million.

Durand left Astra Zeneca (the company’s new name after two mergers) in 1999 for a position with ePocrates in January 2000. That year he and Elizabeth moved to Florida to be near his parents, who are now in their 80s. “My father had worked outside in cold weather his whole life, so within a month of retiring back in 1980, he and my mother had moved to Florida.”

With his money from the TAP fine, Durand retired with no financial worries. His newfound wealth seems not to have changed the fundamentals. He and Elizabeth visit his parents at least twice a week, do their shopping for them, and are adjusting to a new role as grandparents themselves. Family values are still what matters most.

“I fully credit my parents with bringing me up in a way that made it possible for me to go through all this,” says Durand. “I also could not have made it through without the support of my wife, Elizabeth, my family, and my attorney.”v

A former magazine editor in New York City, Jill Connors is now a freelance writer based in Middletown, R.I.

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