When Novartis responded to an intense firestorm over its consulting deal with President Donald Trump's former personal attorney Michael Cohen in May, the company said it ultimately didn't end up working with the attorney. Now, Democratic senators have released a report challenging the company's version of the events.
In a report issued Friday morning, Sens. Ron Wyden, Patty Murray, Elizabeth Warren and Richard Blumenthal concluded that Novartis' former CEO Joseph Jimenez interacted with Cohen during the period of the deal. The report directly challenges Novartis' assertion that the company quickly determined Cohen couldn't provide any consulting help and that the company let the deal lapse without canceling it for cause.
The senators concluded that Jimenez and Cohen spoke on the phone several times between April and September 2017 and "exchanged multiple emails on substantive issues" such as drug pricing, a pharma investment and opioid lawsuits.
On pricing, the senators say Jimenez emailed Cohen in June 2017 about ideas to lower drug costs in the U.S. The report said the ideas were for “discussion with Trump administration” officials. In response, Cohen told the former Novartis helmsman he would show the ideas to an "unidentified third party linked to the administration, who would provide feedback on the document." According to the senators, several of the proposals appeared in Trump's drug pricing blueprint, unveiled in May 2018.
Novartis responded that it disagrees with the conclusion it issued a misleading public statement.
"As the documents we produced show, Novartis had one and only meeting with Mr. Cohen on March 1, 2017 and then concluded he was not able to provide the substantive consulting advice and insight for which he was hired," a company spokesman said in a statement. "We never asked Mr. Cohen to perform any services on our behalf after March 1, nor did he perform any."
The company said that Cohen contacted Jimenez "on a handful of occasions" beyond that initial meeting. One one occasion, according to Novartis, Cohen asked for input on how to lower drug prices. Jimenez "provided him with a list of well-known ideas for lowering the cost of pharmaceuticals that had been discussed publicly in the industry," according to the company's statement.
News of Novartis' deal with Cohen broke back in May when Michael Avenatti, attorney for adult film actress Stormy Daniels, published a report about "suspicious financial transactions" to Cohen from various entities. Novartis quickly confirmed its own deal and said the consulting arrangement was worth $1.2 million over a year.
But the company also said it determined Cohen couldn't provide the consulting help it sought. Instead of trying to cancel the deal for cause, Novartis made monthly payments of $100,000 until February 2018 and let the deal lapse.
The senators' report also challenges that aspect of Novartis' narrative. They wrote that the company "may have misled the public" with the statement that the contract couldn't be terminated.
"To the extent this assertion is true, it is because Novartis engaged in extensive negotiations that resulted in weaker and vaguer contract language than the company had initially sought," the report says. "But the assertion does not appear to be correct. It appears that in fact the company could have terminated Mr. Cohen’s contract."
In its statement, Novartis reiterated a past statement that the consulting deal was a mistake and said it should have tried to terminate the contract "regardless of our views at the time of its legal enforceability.”
Among other details in the senators' report is a disclosure that Cohen encouraged Novartis to invest in Yamo Pharmaceutical, a "privately held company closely connected to Columbus Nova." Columbus Nova is an investment firm whose biggest client is a company controlled by Russian oligarch Viktor Vekselberg, according to the report.