She got a $30.8 million golden parachute in a corporate merger. Now, they’re being laid off and the medicines they produced are set to be manufactured overseas. Will anyone step up to save their jobs, and protect America’s drug supply?
BY KATHERINE EBAN
JULY 23, 2021
VANITY FAIR
VANITY FAIR
ILLUSTRATION BY QUINTON MCMILLAN. IMAGES FROM GETTY.
On July 31, one of America’s largest pharmaceutical-manufacturing plants is scheduled to shut its doors.
Set on 22 acres in Morgantown, West Virginia, the plant, built in 1965 by the once-storied American generic-drug company Mylan Laboratories, has made 61 drug products, including a substantial portion of the world’s supply of levothyroxine, a critical thyroid medicine. Its 1,431 highly trained workers—analytical chemists, industrial engineers, and senior janitors among them—are represented by the steelworkers union. All are slated to be laid off by month’s end.
The Biden administration has a stated goal of increasing domestic production of pharmaceuticals, and the Morgantown plant is one of a dwindling number of facilities on home soil that produce vital and affordable medicine for the U.S. market. The plant has also lifted hundreds of West Virginia families into the middle class, with the children of its employees going on to become doctors and lawyers.
Under Mylan’s cofounder Mike Puskar, employees received free health care and medicine, turkeys on Thanksgiving, Christmas bonuses, and generous wages. “My father walked the plant once a week,” Puskar’s daughter, Johanna, told Vanity Fair. “He knew everyone’s names. He knew their children’s names. He knew their parents’ names.” Puskar died in 2011, nine years after he placed a businessman named Robert J. Coury at the company’s helm.
The new corporate entity, Viatris Inc., was formed in November 2020 when Mylan merged with the Pfizer subsidiary Upjohn. A month later it announced plans to close the Morgantown plant and told the staff it would move most manufacturing to India, and some to Australia, according to a plant employee.
This would seem to be the perfect fight for West Virginia’s senior U.S. senator, Joe Manchin III, a voluble champion of high-paying union jobs for the Mountain State’s workers. But when officials with the United Steelworkers Local 8-957 managed to get roughly two minutes of his time, over a video call he took from the U.S. Senate floor, there was no fight at all. “Sorry about your luck,” he told them, according to a union official and confirmed by five others who participated in the March 10 call. “It sounds like they’ve reached a corporate decision. There is very little I can do.”
A spokesperson for Senator Manchin vehemently denied this account of the call. In a statement to Vanity Fair, Manchin said, “For months, I have engaged in conversations with Viatris, Monongalia County, the Morgantown Area Partnership, and local and state leaders to find a solution that protects every single job.”
But union officials say they never heard anything from Manchin after their brief call. “We can’t reach him,” Joseph Gouzd, president of the local steelworkers union, told me. “He won’t respond. His aides won’t respond.” Their repeated phone calls and requests for a meeting have gone unanswered.
Union officials believe that Manchin’s silence can be traced to the fact that his daughter Heather Bresch, the former CEO of Mylan, walked away with a $30.8 million golden parachute from the Mylan-Upjohn merger. The resulting entity, which so swiftly targeted the Morgantown plant for closure, is led by Bresch’s former Mylan colleagues, who were also exorbitantly compensated in the merger.
“My father spent his whole life to make that company successful, and it took them less than 10 years to destroy it,” Johanna Puskar said as she contemplated the impending closure. “They came and they robbed it blind till there was nothing left.”
In a lengthy statement to Vanity Fair, in response to detailed questions, Viatris said it was committed to ensuring supply continuity, maintaining the quality of its medicines, and providing generous severance packages for its workers. The decision to close the Morgantown plant “was one we did not take lightly and in no way reflects upon the company’s appreciation for the commitment, work ethic, and valuable contributions of our employees,” it said.
For years Mylan’s flagship plant withstood an industry-wide tsunami of outsourcing.
Even as Western drug companies moved manufacturing capacity offshore, seeking a cheaper labor pool, weaker environmental regulations, and more distance from the Food and Drug Administration’s sharp-eyed inspectors, the Morgantown plant thrived. Because of the plant’s exemplary inspection record, and massive scale of operations, the FDA used it for decades as a training ground for its inspectors.
It also helped that the plant’s workers knew they were making drugs for their neighbors and countrymen. By 2017, 17 billion of the 20 billion doses made annually at the Morgantown plant were dispensed to U.S. consumers. “I use some of the drugs they manufacture within five minutes from my home,” said Danielle Walker, a Democrat in the West Virginia House of Delegates.
But the plant Puskar built was no match for the predatory brand of capitalism embraced by the management troika of Bresch, Coury, and a scientist named Rajiv Malik, who’d spent almost two decades at India’s largest drug company, Ranbaxy, before it collapsed in 2013 amid an immense data-fraud scandal. Together, according to numerous current and former employees, they emphasized global expansion over neighborliness, and speed and cost reductions over quality. They also allegedly escalated hostilities with the union in an effort to freeze wages and increase work shifts, even as their own compensation grew spectacularly.
The Morgantown closure isn’t just a tragedy for its American workforce. It’s also a step backward for U.S. efforts to prepare for the next pandemic. “Did 600,000 people die in vain without us learning we couldn’t get hold of sanitizer and toilet paper?” asked Barbara Evans Fleischauer, a Democratic member of the West Virginia House of Delegates. “Aren’t medical drugs important? Wouldn’t we want them to be manufactured in our country?”
In fact, we do. America’s urgent need to control the making of its own essential medicines is supposedly a top priority for the Biden administration. Last month the White House issued a report on building resilient supply chains, which noted that 63% of all FDA-registered facilities manufacturing finished doses of generic drugs, and 87% of those making their active ingredients, are located outside of the United States. The report described this dependence on foreign nations as a “key vulnerability” for the U.S. drug supply and called for “increased domestic production capacity” for critical drugs.
Given this confluence of Senator Manchin’s jobs agenda and President Biden’s goal for American pharmaceutical self-sufficiency, it seems possible that the Morgantown plant could be deemed critical infrastructure. In February an antibiotics plant in Bristol, Tennessee—the only U.S.-based facility still making amoxicillin—was rescued from imminent closure after being designated as critical infrastructure under the federal Cybersecurity & Infrastructure Security Agency (CISA).
At its height, in 2016, the Morgantown manufacturing site employed more than 3,700 full-time employees and made more than 1,400 drug products, a scale that dwarfs most American drug-manufacturing sites, according to FDA records characterized for Vanity Fair.
But instead of trying to save the plant, Biden officials appear to be tiptoeing around Manchin, who has emerged as a political kingmaker and hostage-taker in a U.S. Senate where Democrats hold a whisker-thin majority. Making the most of his power to swing votes, he has blocked critical aspects of President Biden’s agenda by refusing to support filibuster reform and taken campaign contributions from Republican donors happy to reward his spoiler role.
Hence a strange cone of silence has descended over this looming manufacturing wipeout that will harm the national interest. A U.S. Health and Human Services spokesperson declined to make any officials available for an interview, telling Vanity Fair, “We are aware and tracking this closure that was announced last year—but we cannot speak to internal efforts regarding one company at this time.” The White House did not respond to a request for comment.
In 1961, Mike Puskar and a fellow Army veteran named Don Panoz launched the drug-distribution business that would become Mylan Laboratories in an abandoned skating rink in White Sulphur Springs, West Virginia. As the company grew, its operations were guided by Puskar’s oft-stated motto: “Do it right, or don’t do it at all.”
An episode in 1988 helped cement the company’s reputation for integrity. In an attempt to figure out why the FDA was slow-walking approval of its drug applications, Mylan hired a private detective who helped uncover a major corruption scandal. Competing generic-drug companies were bribing FDA reviewers to accelerate approval of their applications, literally dropping envelopes of cash onto their desks. Amid industry reforms, the Morgantown plant became an exemplar.
As recounted in the company-sponsored book Mylan: 50 Years of Unconventional Success, an FDA investigator would perch on a ladder and draw a white-gloved finger across the top of the plant’s manufacturing equipment. Company executives let out a sigh of relief once the gloved finger came up “white as ever.” The FDA’s regulations require all surfaces to be dust-free. Signs that read “WE DO WHAT’S RIGHT, NOT WHAT’S EASY” adorned the hallways of the Morgantown plant.
Quietly, Puskar earned his employees’ gratitude by helping them with medical needs, going so far as to fly at least one of them to the Mayo Clinic in Rochester, Minnesota, for an organ transplant. At her childhood home, Johanna Puskar recalled seeing a watercolor painting of a mountaineer holding a blonde-haired girl on his shoulders. She later learned that an employee had sent it to thank Puskar for paying out of pocket to get his daughter lifesaving medical treatment.
Facing his own health issues, Puskar stepped down as board chairman in 2009. Coury, who was then CEO, became chairman of the board, and Bresch, Manchin’s daughter, became president. The hallmarks of community-oriented management, such as the Christmas bonuses and Thanksgiving turkeys, would soon vanish. According to one employee, when union members—who had been engaged in collective bargaining—raised the Christmas bonuses with Bresch at a company-wide meeting in the Morgantown plant’s cafeteria in December 2011, she replied, “What do you prefer, a Christmas bonus or a job?” By 2015, her annual compensation had risen more than 600%, to nearly $19 million. Bresch did not respond to a request for comment.
“He knew at the end he made a mistake” in turning over the company to Coury, Johanna said of her father, who was blocked from even reentering the plant by the new management team. Before he succumbed to liver cancer in 2011, Puskar insisted to his daughter that she extend the viewing of his body to 12 hours—four hours longer than the Mylan work shift. “He was scared to death that a worker would take off [time for] his viewing and get fired,” Johanna recalled.
For 12 hours, a line of grieving employees wrapped around a city block outside the Waterfront Marriott in downtown Morgantown.
By late 2005, Mylan was losing market share to Indian drug companies that made their own active ingredients and operated at rock-bottom costs. Confronting this new ecosystem, Robert Coury apparently decided: If you can’t beat them, join them.
So began a series of overseas acquisitions that brought Rajiv Malik into the company’s senior leadership. A canny process chemist, he had mastered the art of reverse engineering brand-name drugs and figuring out how to remake them more quickly and cheaply in generic form.
By 2013, Malik had become Mylan’s president and executive director of the board. More than half of the company’s 50 plants and 35,000 employees would soon be based in India. As the U.S. drug supply went global, and generic drugs manufactured overseas plunged in price, Mike Puskar’s values had become a relic. Companies no longer competed on quality. They competed on cost, the lower the better.
Under this new system, it was no longer always a winning strategy to comply with FDA regulations and ensure dust-free surfaces. For some companies, shortcuts and concealment became more cost-effective than compliance. That new reality brought about a culture shift within Mylan. “When they went global,” said one former employee, “that’s when the change occurred.” Before long, the company that had once served as a whistleblower, exposing corruption within the generic-drug industry, was sprouting whistleblowers of its own.
Under FDA regulations, plants must maintain their data in scrupulous condition, intact and unaltered as a verifiable record of each manufacturing step. But allegations of data manipulation, document shredding, and perilous cleaning lapses soon reached the FDA from whistleblowers in several Mylan facilities, including the Morgantown plant itself.
Meanwhile, a series of scandals trailed the executive team. In 2008, West Virginia University had to revoke Bresch’s MBA after it was revealed that she’d failed to complete coursework. The university had doctored her transcripts and awarded her the degree when Manchin became governor. There were allegations that Coury misused the company jet to fly his musician son to gigs. (At the time a Mylan spokesperson said that Coury’s contract allowed for personal use of the company jet.) By 2017, Malik had been named as a defendant in a civil complaint filed by 47 state attorneys general that alleged 18 generic-drug companies, including Mylan, had colluded to keep generic-drug prices artificially high. (Both Malik and Mylan have denied wrongdoing in the ongoing probe.)
In 2016, Bresch and her colleagues blundered into a massive public relations crisis after raising the price of Mylan’s lifesaving EpiPen—needed by millions of Americans, including school children, to reverse fatal allergic reactions—by 400%. Bresch was hauled before Congress to testify, flying into Washington, D.C., by private jet. Blaming the price hike on a broken health care system, she declared in a disastrous CNBC interview, “No one’s more frustrated than me.”
That same year Bresch earned $13.8 million and Malik earned $8.7 million in total compensation, while Coury netted $98 million, becoming one of the country’s highest-paid pharmaceutical executives. The head-spinning sums led some of the company’s biggest institutional investors to revolt, campaigning unsuccessfully in 2017 to block their continued corporate leadership.
By January 2018, a whistleblower at the Morgantown plant had contacted the FDA, flagging “fraud or disregard for procedure” driven by management, according to an internal FDA memo obtained by Vanity Fair. The whistleblower claimed that Morgantown, once the FDA’s gold standard for compliance, had developed an “embedded culture” that permitted fraud.
In mid-March, guided by whistleblower information, nine FDA investigators arrived at the Morgantown plant for a surprise inspection. The results were devastating. The inspection yielded a 32-page report detailing regulatory violations and a subsequent warning letter that froze much of the plant’s manufacturing until corrections were made. The Morgantown plant was on life support. “They started to mandate what kind of pens we could use in the labs,” one current employee reflected. “We couldn’t use Post-its under any circumstances. Any paper, even personal notes, could not be shredded or thrown away and had to go through a management review process.” (The FDA lifted Morgantown’s warning letter last spring, clearing the plant for full manufacturing.)
In October 2018, at an invective-laden meeting with union officials at Mylan’s corporate headquarters in Canonsburg, Pennsylvania, a furious Malik ordered the union to fall in line, agree to 12-hour shifts, and allow workers to be moved anywhere in the plant that management chose. Otherwise, he threatened, according to three meeting attendees, “I will bury Morgantown. It will all go to India and my people will get the benefits.” (A lawyer for Viatris denied that Mr. Malik said this.)
Union officials now believe that was the plan all along. The union vice president, Bill Hawkins, who attended the meeting, paraphrased Malik’s position this way: I can pay my people over there $400 a year, or I can pay you people $70,000 a year, so you do what I want.
One afternoon last December, Johanna Puskar got a call from her son, who broke the news: “Mom, they’re closing Mylan down in Morgantown.”
“I just lost it,” Johanna recalled. “I was sobbing, ‘There goes dad’s legacy.’” But she also knew that the community of Morgantown itself was at stake. “It’s just not that Mylan pharmaceuticals is closing. Those people go to doctors. Those people get their hair done. It’s going to be a chain reaction.”
America’s pharmaceutical supply also hangs in the balance. It is one thing to shutter Morgantown. But it is quite another to relocate the manufacturing of 20 billion annual doses of medicine to another continent amid the ongoing COVID-19 pandemic.
Bresch’s former colleague Malik, now president of Viatris, netted $20.8 million from the Mylan-Upjohn merger. Coury, Viatris’s new executive chairman, pulled in $29 million last year. Now it’s up to them to determine where all those doses will be produced.
Viatris was apparently banking on moving much of the manufacturing to several Mylan plants in India that are now banned from producing drugs for the U.S. market because of FDA violations. In order to restart, those plants would have to clear in-person inspections, which the FDA has frozen due to the pandemic. Vanity Fair has learned that, in light of this backlog, Malik has written repeatedly to FDA officials, urging the agency to clear the plants without an in-person inspection in what is known as a desktop review. So far the FDA has declined to do so, and it typically won’t clear plants remotely if they have checkered inspection histories. If the Morgantown plant is closed and the Indian plants can’t be approved for new manufacturing, there could be dangerous drug shortages.
With this offshoring meteor hurtling toward the U.S. drug supply, the union has been conducting frantic negotiations over a severance package and puzzling over management’s true intentions. Will they really shut down Morgantown if they cannot successfully transfer the manufacturing? Or are they trying to flush the union out of the plant, with the goal of resuming operations with a non-union workforce at some later date? David Beard, a statehouse reporter for a local paper, The Dominion Post, has been covering the approaching closure. He says Viatris management is “not responding” to requests from him, from local legislators, or even from prospective buyers to tour the plant.
There is still a flicker of hope that the government could save Morgantown using the same playbook that kept the amoxicillin plant open in Bristol, Tennessee. “We did change the course of history for that plant and that town,” said David Argyle, an Australian businessman sent to Tennessee by the facility’s British owners to examine the plant’s viability. He helped orchestrate a rescue by placing the plant into Chapter 11 bankruptcy, securing the CISA designation, and then finding an American buyer. On July 19, Barbara Evans Fleischauer of the West Virginia House of Delegates wrote to CISA’s director, asking the agency to designate the Morgantown plant, its equipment, and its drug applications critical infrastructure. With time running out, it’s a Hail Mary pass.
Rep. Anna Eshoo (D-Calif.), chair of the House Energy and Commerce Committee’s health subcommittee, said of the impending Morgantown plant closure, “Congress invested millions of dollars in the COVID-19 relief bills to support the construction or renovation of U.S.-based drug-manufacturing facilities to protect our domestic drug supply chain and the jobs they produce. If we fail to address this dangerous trend, the U.S. will continue to be at the mercy of subpar manufacturing and vulnerable to foreign adversaries.”
Meanwhile, at the steelworkers union headquarters, Joseph Gouzd and his colleagues are fielding calls from panicked plant employees wanting to know how long their health insurance will last, whether they can refill prescriptions, and if they need to cancel upcoming medical procedures. “It’s a shitstorm right now, and it’s just boiling over,” Gouzd said. Why, he wants to know, haven’t Manchin and West Virginia’s other top elected officials “put anything in the newspaper”?
“For this to just be a damn silence,” he says, his voice trailing off. “It’s a killing silence.”
On July 31, one of America’s largest pharmaceutical-manufacturing plants is scheduled to shut its doors.
Set on 22 acres in Morgantown, West Virginia, the plant, built in 1965 by the once-storied American generic-drug company Mylan Laboratories, has made 61 drug products, including a substantial portion of the world’s supply of levothyroxine, a critical thyroid medicine. Its 1,431 highly trained workers—analytical chemists, industrial engineers, and senior janitors among them—are represented by the steelworkers union. All are slated to be laid off by month’s end.
The Biden administration has a stated goal of increasing domestic production of pharmaceuticals, and the Morgantown plant is one of a dwindling number of facilities on home soil that produce vital and affordable medicine for the U.S. market. The plant has also lifted hundreds of West Virginia families into the middle class, with the children of its employees going on to become doctors and lawyers.
Under Mylan’s cofounder Mike Puskar, employees received free health care and medicine, turkeys on Thanksgiving, Christmas bonuses, and generous wages. “My father walked the plant once a week,” Puskar’s daughter, Johanna, told Vanity Fair. “He knew everyone’s names. He knew their children’s names. He knew their parents’ names.” Puskar died in 2011, nine years after he placed a businessman named Robert J. Coury at the company’s helm.
The new corporate entity, Viatris Inc., was formed in November 2020 when Mylan merged with the Pfizer subsidiary Upjohn. A month later it announced plans to close the Morgantown plant and told the staff it would move most manufacturing to India, and some to Australia, according to a plant employee.
This would seem to be the perfect fight for West Virginia’s senior U.S. senator, Joe Manchin III, a voluble champion of high-paying union jobs for the Mountain State’s workers. But when officials with the United Steelworkers Local 8-957 managed to get roughly two minutes of his time, over a video call he took from the U.S. Senate floor, there was no fight at all. “Sorry about your luck,” he told them, according to a union official and confirmed by five others who participated in the March 10 call. “It sounds like they’ve reached a corporate decision. There is very little I can do.”
A spokesperson for Senator Manchin vehemently denied this account of the call. In a statement to Vanity Fair, Manchin said, “For months, I have engaged in conversations with Viatris, Monongalia County, the Morgantown Area Partnership, and local and state leaders to find a solution that protects every single job.”
But union officials say they never heard anything from Manchin after their brief call. “We can’t reach him,” Joseph Gouzd, president of the local steelworkers union, told me. “He won’t respond. His aides won’t respond.” Their repeated phone calls and requests for a meeting have gone unanswered.
Union officials believe that Manchin’s silence can be traced to the fact that his daughter Heather Bresch, the former CEO of Mylan, walked away with a $30.8 million golden parachute from the Mylan-Upjohn merger. The resulting entity, which so swiftly targeted the Morgantown plant for closure, is led by Bresch’s former Mylan colleagues, who were also exorbitantly compensated in the merger.
“My father spent his whole life to make that company successful, and it took them less than 10 years to destroy it,” Johanna Puskar said as she contemplated the impending closure. “They came and they robbed it blind till there was nothing left.”
In a lengthy statement to Vanity Fair, in response to detailed questions, Viatris said it was committed to ensuring supply continuity, maintaining the quality of its medicines, and providing generous severance packages for its workers. The decision to close the Morgantown plant “was one we did not take lightly and in no way reflects upon the company’s appreciation for the commitment, work ethic, and valuable contributions of our employees,” it said.
For years Mylan’s flagship plant withstood an industry-wide tsunami of outsourcing.
Even as Western drug companies moved manufacturing capacity offshore, seeking a cheaper labor pool, weaker environmental regulations, and more distance from the Food and Drug Administration’s sharp-eyed inspectors, the Morgantown plant thrived. Because of the plant’s exemplary inspection record, and massive scale of operations, the FDA used it for decades as a training ground for its inspectors.
It also helped that the plant’s workers knew they were making drugs for their neighbors and countrymen. By 2017, 17 billion of the 20 billion doses made annually at the Morgantown plant were dispensed to U.S. consumers. “I use some of the drugs they manufacture within five minutes from my home,” said Danielle Walker, a Democrat in the West Virginia House of Delegates.
But the plant Puskar built was no match for the predatory brand of capitalism embraced by the management troika of Bresch, Coury, and a scientist named Rajiv Malik, who’d spent almost two decades at India’s largest drug company, Ranbaxy, before it collapsed in 2013 amid an immense data-fraud scandal. Together, according to numerous current and former employees, they emphasized global expansion over neighborliness, and speed and cost reductions over quality. They also allegedly escalated hostilities with the union in an effort to freeze wages and increase work shifts, even as their own compensation grew spectacularly.
The Morgantown closure isn’t just a tragedy for its American workforce. It’s also a step backward for U.S. efforts to prepare for the next pandemic. “Did 600,000 people die in vain without us learning we couldn’t get hold of sanitizer and toilet paper?” asked Barbara Evans Fleischauer, a Democratic member of the West Virginia House of Delegates. “Aren’t medical drugs important? Wouldn’t we want them to be manufactured in our country?”
In fact, we do. America’s urgent need to control the making of its own essential medicines is supposedly a top priority for the Biden administration. Last month the White House issued a report on building resilient supply chains, which noted that 63% of all FDA-registered facilities manufacturing finished doses of generic drugs, and 87% of those making their active ingredients, are located outside of the United States. The report described this dependence on foreign nations as a “key vulnerability” for the U.S. drug supply and called for “increased domestic production capacity” for critical drugs.
Given this confluence of Senator Manchin’s jobs agenda and President Biden’s goal for American pharmaceutical self-sufficiency, it seems possible that the Morgantown plant could be deemed critical infrastructure. In February an antibiotics plant in Bristol, Tennessee—the only U.S.-based facility still making amoxicillin—was rescued from imminent closure after being designated as critical infrastructure under the federal Cybersecurity & Infrastructure Security Agency (CISA).
At its height, in 2016, the Morgantown manufacturing site employed more than 3,700 full-time employees and made more than 1,400 drug products, a scale that dwarfs most American drug-manufacturing sites, according to FDA records characterized for Vanity Fair.
But instead of trying to save the plant, Biden officials appear to be tiptoeing around Manchin, who has emerged as a political kingmaker and hostage-taker in a U.S. Senate where Democrats hold a whisker-thin majority. Making the most of his power to swing votes, he has blocked critical aspects of President Biden’s agenda by refusing to support filibuster reform and taken campaign contributions from Republican donors happy to reward his spoiler role.
Hence a strange cone of silence has descended over this looming manufacturing wipeout that will harm the national interest. A U.S. Health and Human Services spokesperson declined to make any officials available for an interview, telling Vanity Fair, “We are aware and tracking this closure that was announced last year—but we cannot speak to internal efforts regarding one company at this time.” The White House did not respond to a request for comment.
In 1961, Mike Puskar and a fellow Army veteran named Don Panoz launched the drug-distribution business that would become Mylan Laboratories in an abandoned skating rink in White Sulphur Springs, West Virginia. As the company grew, its operations were guided by Puskar’s oft-stated motto: “Do it right, or don’t do it at all.”
An episode in 1988 helped cement the company’s reputation for integrity. In an attempt to figure out why the FDA was slow-walking approval of its drug applications, Mylan hired a private detective who helped uncover a major corruption scandal. Competing generic-drug companies were bribing FDA reviewers to accelerate approval of their applications, literally dropping envelopes of cash onto their desks. Amid industry reforms, the Morgantown plant became an exemplar.
As recounted in the company-sponsored book Mylan: 50 Years of Unconventional Success, an FDA investigator would perch on a ladder and draw a white-gloved finger across the top of the plant’s manufacturing equipment. Company executives let out a sigh of relief once the gloved finger came up “white as ever.” The FDA’s regulations require all surfaces to be dust-free. Signs that read “WE DO WHAT’S RIGHT, NOT WHAT’S EASY” adorned the hallways of the Morgantown plant.
Quietly, Puskar earned his employees’ gratitude by helping them with medical needs, going so far as to fly at least one of them to the Mayo Clinic in Rochester, Minnesota, for an organ transplant. At her childhood home, Johanna Puskar recalled seeing a watercolor painting of a mountaineer holding a blonde-haired girl on his shoulders. She later learned that an employee had sent it to thank Puskar for paying out of pocket to get his daughter lifesaving medical treatment.
Facing his own health issues, Puskar stepped down as board chairman in 2009. Coury, who was then CEO, became chairman of the board, and Bresch, Manchin’s daughter, became president. The hallmarks of community-oriented management, such as the Christmas bonuses and Thanksgiving turkeys, would soon vanish. According to one employee, when union members—who had been engaged in collective bargaining—raised the Christmas bonuses with Bresch at a company-wide meeting in the Morgantown plant’s cafeteria in December 2011, she replied, “What do you prefer, a Christmas bonus or a job?” By 2015, her annual compensation had risen more than 600%, to nearly $19 million. Bresch did not respond to a request for comment.
“He knew at the end he made a mistake” in turning over the company to Coury, Johanna said of her father, who was blocked from even reentering the plant by the new management team. Before he succumbed to liver cancer in 2011, Puskar insisted to his daughter that she extend the viewing of his body to 12 hours—four hours longer than the Mylan work shift. “He was scared to death that a worker would take off [time for] his viewing and get fired,” Johanna recalled.
For 12 hours, a line of grieving employees wrapped around a city block outside the Waterfront Marriott in downtown Morgantown.
By late 2005, Mylan was losing market share to Indian drug companies that made their own active ingredients and operated at rock-bottom costs. Confronting this new ecosystem, Robert Coury apparently decided: If you can’t beat them, join them.
So began a series of overseas acquisitions that brought Rajiv Malik into the company’s senior leadership. A canny process chemist, he had mastered the art of reverse engineering brand-name drugs and figuring out how to remake them more quickly and cheaply in generic form.
By 2013, Malik had become Mylan’s president and executive director of the board. More than half of the company’s 50 plants and 35,000 employees would soon be based in India. As the U.S. drug supply went global, and generic drugs manufactured overseas plunged in price, Mike Puskar’s values had become a relic. Companies no longer competed on quality. They competed on cost, the lower the better.
Under this new system, it was no longer always a winning strategy to comply with FDA regulations and ensure dust-free surfaces. For some companies, shortcuts and concealment became more cost-effective than compliance. That new reality brought about a culture shift within Mylan. “When they went global,” said one former employee, “that’s when the change occurred.” Before long, the company that had once served as a whistleblower, exposing corruption within the generic-drug industry, was sprouting whistleblowers of its own.
Under FDA regulations, plants must maintain their data in scrupulous condition, intact and unaltered as a verifiable record of each manufacturing step. But allegations of data manipulation, document shredding, and perilous cleaning lapses soon reached the FDA from whistleblowers in several Mylan facilities, including the Morgantown plant itself.
Meanwhile, a series of scandals trailed the executive team. In 2008, West Virginia University had to revoke Bresch’s MBA after it was revealed that she’d failed to complete coursework. The university had doctored her transcripts and awarded her the degree when Manchin became governor. There were allegations that Coury misused the company jet to fly his musician son to gigs. (At the time a Mylan spokesperson said that Coury’s contract allowed for personal use of the company jet.) By 2017, Malik had been named as a defendant in a civil complaint filed by 47 state attorneys general that alleged 18 generic-drug companies, including Mylan, had colluded to keep generic-drug prices artificially high. (Both Malik and Mylan have denied wrongdoing in the ongoing probe.)
In 2016, Bresch and her colleagues blundered into a massive public relations crisis after raising the price of Mylan’s lifesaving EpiPen—needed by millions of Americans, including school children, to reverse fatal allergic reactions—by 400%. Bresch was hauled before Congress to testify, flying into Washington, D.C., by private jet. Blaming the price hike on a broken health care system, she declared in a disastrous CNBC interview, “No one’s more frustrated than me.”
That same year Bresch earned $13.8 million and Malik earned $8.7 million in total compensation, while Coury netted $98 million, becoming one of the country’s highest-paid pharmaceutical executives. The head-spinning sums led some of the company’s biggest institutional investors to revolt, campaigning unsuccessfully in 2017 to block their continued corporate leadership.
By January 2018, a whistleblower at the Morgantown plant had contacted the FDA, flagging “fraud or disregard for procedure” driven by management, according to an internal FDA memo obtained by Vanity Fair. The whistleblower claimed that Morgantown, once the FDA’s gold standard for compliance, had developed an “embedded culture” that permitted fraud.
In mid-March, guided by whistleblower information, nine FDA investigators arrived at the Morgantown plant for a surprise inspection. The results were devastating. The inspection yielded a 32-page report detailing regulatory violations and a subsequent warning letter that froze much of the plant’s manufacturing until corrections were made. The Morgantown plant was on life support. “They started to mandate what kind of pens we could use in the labs,” one current employee reflected. “We couldn’t use Post-its under any circumstances. Any paper, even personal notes, could not be shredded or thrown away and had to go through a management review process.” (The FDA lifted Morgantown’s warning letter last spring, clearing the plant for full manufacturing.)
In October 2018, at an invective-laden meeting with union officials at Mylan’s corporate headquarters in Canonsburg, Pennsylvania, a furious Malik ordered the union to fall in line, agree to 12-hour shifts, and allow workers to be moved anywhere in the plant that management chose. Otherwise, he threatened, according to three meeting attendees, “I will bury Morgantown. It will all go to India and my people will get the benefits.” (A lawyer for Viatris denied that Mr. Malik said this.)
Union officials now believe that was the plan all along. The union vice president, Bill Hawkins, who attended the meeting, paraphrased Malik’s position this way: I can pay my people over there $400 a year, or I can pay you people $70,000 a year, so you do what I want.
One afternoon last December, Johanna Puskar got a call from her son, who broke the news: “Mom, they’re closing Mylan down in Morgantown.”
“I just lost it,” Johanna recalled. “I was sobbing, ‘There goes dad’s legacy.’” But she also knew that the community of Morgantown itself was at stake. “It’s just not that Mylan pharmaceuticals is closing. Those people go to doctors. Those people get their hair done. It’s going to be a chain reaction.”
America’s pharmaceutical supply also hangs in the balance. It is one thing to shutter Morgantown. But it is quite another to relocate the manufacturing of 20 billion annual doses of medicine to another continent amid the ongoing COVID-19 pandemic.
Bresch’s former colleague Malik, now president of Viatris, netted $20.8 million from the Mylan-Upjohn merger. Coury, Viatris’s new executive chairman, pulled in $29 million last year. Now it’s up to them to determine where all those doses will be produced.
Viatris was apparently banking on moving much of the manufacturing to several Mylan plants in India that are now banned from producing drugs for the U.S. market because of FDA violations. In order to restart, those plants would have to clear in-person inspections, which the FDA has frozen due to the pandemic. Vanity Fair has learned that, in light of this backlog, Malik has written repeatedly to FDA officials, urging the agency to clear the plants without an in-person inspection in what is known as a desktop review. So far the FDA has declined to do so, and it typically won’t clear plants remotely if they have checkered inspection histories. If the Morgantown plant is closed and the Indian plants can’t be approved for new manufacturing, there could be dangerous drug shortages.
With this offshoring meteor hurtling toward the U.S. drug supply, the union has been conducting frantic negotiations over a severance package and puzzling over management’s true intentions. Will they really shut down Morgantown if they cannot successfully transfer the manufacturing? Or are they trying to flush the union out of the plant, with the goal of resuming operations with a non-union workforce at some later date? David Beard, a statehouse reporter for a local paper, The Dominion Post, has been covering the approaching closure. He says Viatris management is “not responding” to requests from him, from local legislators, or even from prospective buyers to tour the plant.
There is still a flicker of hope that the government could save Morgantown using the same playbook that kept the amoxicillin plant open in Bristol, Tennessee. “We did change the course of history for that plant and that town,” said David Argyle, an Australian businessman sent to Tennessee by the facility’s British owners to examine the plant’s viability. He helped orchestrate a rescue by placing the plant into Chapter 11 bankruptcy, securing the CISA designation, and then finding an American buyer. On July 19, Barbara Evans Fleischauer of the West Virginia House of Delegates wrote to CISA’s director, asking the agency to designate the Morgantown plant, its equipment, and its drug applications critical infrastructure. With time running out, it’s a Hail Mary pass.
Rep. Anna Eshoo (D-Calif.), chair of the House Energy and Commerce Committee’s health subcommittee, said of the impending Morgantown plant closure, “Congress invested millions of dollars in the COVID-19 relief bills to support the construction or renovation of U.S.-based drug-manufacturing facilities to protect our domestic drug supply chain and the jobs they produce. If we fail to address this dangerous trend, the U.S. will continue to be at the mercy of subpar manufacturing and vulnerable to foreign adversaries.”
Meanwhile, at the steelworkers union headquarters, Joseph Gouzd and his colleagues are fielding calls from panicked plant employees wanting to know how long their health insurance will last, whether they can refill prescriptions, and if they need to cancel upcoming medical procedures. “It’s a shitstorm right now, and it’s just boiling over,” Gouzd said. Why, he wants to know, haven’t Manchin and West Virginia’s other top elected officials “put anything in the newspaper”?
“For this to just be a damn silence,” he says, his voice trailing off. “It’s a killing silence.”
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