AP FACT CHECK: Ad on Tina Smith’s investments is misleading
In the race to complete former Minnesota Sen. Al Franken’s term, Republican hopeful Karin Housley has branded Democratic Sen. Tina Smith as an extreme liberal and a political insider. In a recent ad, she employed a new line: Smith has profited off the spread of opioid painkillers that have led to thousands of deaths.
Smith, the state’s former lieutenant governor, was appointed to the U.S. Senate seat in January after Franken resigned amid allegations of sexual misconduct. Housley, a second-term state senator and the wife of Hall of Fame hockey player Phil Housley, quickly launched her campaign after Franken’s resignation.
The Housley campaign makes several claims about Smith’s wealth in the attack ad, titled “The Good Life,” that began airing statewide earlier this month and shows a couple on the beach clinking champagne glasses.
A look at one of the ad’s claims:
AD: “Tina profited from the opioid crisis” – television ad that began running Oct. 18.
THE FACTS: The Housley campaign’s claim that Smith profited off the opioid crisis through investments is misleading.
Smith’s husband, Archie Smith, is a successful independent investor, focusing largely on health care and medical companies.
Housley’s ad claim is based on two of Archie Smith’s investments — one in Abbott Laboratories, the other in Johnson & Johnson that are listed in the senator’s financial disclosure forms . The forms reveal the Smiths are worth between $5 million and $12 million.
Smith’s husband has between $250,000 and $500,0000 invested in Abbott, which marketed OxyContin until 2002. The painkiller has been blamed for escalating the addiction crisis that has left more than 340,000 Americans dead since 2000.
But Archie Smith only acquired the stock last year, well after Abbott Labs quit marketing OxyContin and had divested it’s involvement with the painkiller Vicodin in 2013. He received the stock when Abbott took over Minnesota-based St. Jude Medical Center last year, which he had initially invested in, Smith’s campaign said.
“They were a major opioid player in the past,” Andrew Kolodny, the director of opioid policy research at Brandeis University in Massachusetts, said of Abbott. “Today, they’re not.”
Disclosure forms show that Archie Smith has also held a smaller investment worth between $1,001 and $15,000 in Johnson & Johnson, the world’s biggest maker of health care products. He’s invested in J&J since 1997, according to the campaign.
It’s true the company has been involved with opioid production, including manufacturing an opioid pain patch called Duragesic. J&J has also been named in several lawsuits that blame pharmaceutical companies for triggering the nation’s opioid epidemic.
But it’s less clear how Archie Smith, who reported between $200 and $1,000 in dividends from his J&J stock last year in disclosure forms, might have profited off that activity.
Johnson & Johnson is a massive company that recorded $76.5 billion in sales last year from its three divisions: biotech drugs, medical devices and consumer goods — such as baby shampoo or Band-Aids.
Pharmaceuticals account for roughly a third of the company’s profits, said Damien Conover an analyst for Morningstar, a financial research and services company in Chicago.
Duragesic led drug sales in the pharmaceutical division for Johnson & Johnson in the 1990s and early 2000s, while Archie Smith owned stock, but sales began to slip more than a decade ago as the market faced increased competition.
Conover said Johnson & Johnson’s pharmaceutical division currently focuses more on oncology and immunology drugs.
“It gets really diversified,” Conover said of the J&J’s pharmaceutical division. “They don’t have much of a pain franchise.”
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