Big Pharma has Lured Dems Into a Faustian Bargain

Big Pharma, whose lobbying winning streak shows no sign of ending, has lured Democrats into a Faustian bargain.

In exchange for a $150 million advertising campaign featuring a sadder and sicker Harry and Louise, drug industry lobbyists have quietly been handed almost everything they wanted out of health care reform legislation. Unless the Democrats on Capitol Hill rediscover their campaign rhetoric, the legislation:

- Will not allow Medicare to negotiate drug prices, a core Democratic demand promised BY candidate Barack Obama

- Will not contain even a mildly restrictive drug formulary, where Medicare establishes a "don't buy" list of drugs where there clearly are cheaper and equally effective alternatives

- Will give Big Pharma and other provider interests a seat at the table when comparative effective research priorities get established, ensuring that medical arenas with huge potential for cost savings go unaddressed, and

- Will give biotech firms at least 12 ½ years of market exclusivity for their drugs before biogenerics are allowed to enter the market, extending their high-price marketing period beyond patent expiration if necessary.

Those who've long followed the drug industry lobbying in Washington won't be surprised by this outcome. This is an industry that has not suffered a serious lobbying defeat in more than quarter of a century.
Even the 2007 Food and Drug Administration reform bill, passed in the wake of the Vioxx fiasco, did not challenge the industry's core economic interests. Its major change, giving the FDA more power to insist on post-marketing safety surveillance, was a reform that was long overdue for an industry that has increasingly come to rely on blockbuster drugs whose long-term risks and long-term benefits are all too often nearly identical.

So now, come 2009, what have the Obama administration and the Democratic leadership gotten for giving in to every core industry "ask"? The $80 billion in drug industry "savings" over the next decade--announced with much fanfare in a White House Rose Garden ceremony two months ago--amounts to a mere 2 percent of the total drug tab over the next decade, which is still slated to grow at somewhere between 1 ½ to 2 times the rate of inflation--just like the rest of the health care economy.

Moreover, the promise came in the form of aid for some seniors, which does nothing to raise money for the uninsured. PhRMA promised to lessen the pain of the doughnut hole that many seniors fall into when their drug bills exceed $2,500 a year. That helps those individual seniors reduce their out-of-pocket expenses, but it's nothing to the bean counters at the Congressional Budget Office since it saves Medicare nothing.

Past is prologue here. Since at least the mid-1980s, PhRMA has gotten just about everything it wanted out of Washington, ensuring that its share of the health care pie would grow even faster than health care as a whole. Drug expenditures are now about 12 percent of the nation's $2.4 billion health care tab, up from less than 8 percent in the 1980s.

How did that happen? In the late 1980s, the industry fought for and won an accelerated approval system for drugs that combat life-threatening diseases. It made sense at the dawn of the HIV/AIDS; it is questionable when used for cancer drugs that cost a small fortune but barely improve life expectancy if at all.

In the 1990s, constant drug industry bellyaching about delays at the FDA led to passage of the Prescription Drug User Fee Act, which is reauthorized every five years. Besides the inherent conflict of interest of drug reviewers having their salaries depend on the companies whose products they're reviewing, it put those reviews under tremendous time pressure. The law gave the agency just one year to get a new drug application out the door.

Not surprisingly, over the next decade the industry was hit by a series of high profile recalls: Fen-Phen, Seldane, Rezulin, and, finally, Vioxx, where an estimated 40,000 to 100,000 people died from unnecessary heart attacks because they took a pricey arthritis painkiller no more effective than proven over-the-counter medications like ibuprofen or acetaminophen. It was a field day for investigative reporters and trial lawyers, not so good for patients and consumers.

Of course, those drugs wouldn't have won rapid "acceptance" in the marketplace if it hadn't been for the vast expansion of drug industry marketing that took place in the 1990s and continues to this day. New rules passed in 1997 enabled a vast expansion of direct-to-consumer (DTC) advertising on television. When reformers tried to put a few limits on DTC in the 2007 reform bill, drug industry lobbyists easily defeated their efforts, claiming the restrictions - which had been in place since the dawn of television - were an unconstitutional restriction on commercial speech.

And in this decade, as the storm over drug pricing emerged and the failure of Medicare to provide prescription drug coverage became a national scandal, the industry welcomed passage of the 2003 prescription drug benefit - as long as it didn't impose price controls or allow Medicare to negotiate prices or even set restrictive formularies.

Remember when seniors were climbing on buses to go to Canada to buy cheaper drugs? It was against the law then, and it's still against the law as Big Pharma beat back every effort to allow what are known in the trade as parallel imports from countries where drugs are cheaper because their governments aren't in the thrall of industry lobbyists.

Reformers were naïve if they thought the world had changed simply because there were new tenants in the majority offices on the Hill or in the White House. Even before President Obama's election, drug industry lobbyists had strategically shifted their campaign contributions to Democratic legislators who had won control of Congress two years earlier.

Before 2006, Democrats received just a third of Big Pharma's campaign contributions. Now they get well over half. Drug firms also recruited a new cadre of K Street lobbyists. The new firms that won their businesses included on the rosters former top aides to House Speaker Nancy Pelosi, Ways and Means chairman Charles Rangel, Senate Finance Committee chair Max Baucus and Senate Health Education Labor and Pensions chair Ted Kennedy.

The bottom line is that Big Pharma has had its way in Washington for a long, long time. And nothing in this year's health care reform battle indicates that its winning streak is about to end.

 

Follow Merrill Goozner on Twitter: www.twitter.com/gooznews

Comments

[Confused1]

This article makes it painfully evident to everyone that Obama is not interested in "lowering" medical costs. He is willing to sacrifice his integrity and throw his campaign promises under the bus merely to get health reform passed any way he can so it will be part of his "legacy." To hell with the peons, so what if it negatively impacts 85% of Americans who like the health care they have, so what if it doesn't work. Ironically, none of the plans out there will cover all of the uninsured anyway, so the rational for wanting this legislation in the first place is out the window. He has shown he is willing to get into bed with whomever and will make deals that will not benefit the people, all in the name of getting this legislation passed--so HE looks good. Hope you like the "change."

[saffire]

The key question is, why haven't "campaign contributions" and "conflict of interest" been linked?

[mcmchugh99]

Dare i say it, but maybe we need a public option in the production and distribution of pharmaceuticals? Which is to say, the government should do some of that itself instead of leaving it to private companies.

Why let a big crisis of capitalism go to waste?

If it were me, I would have found a way to finance a lot of this stuff through the Federal Reserve. Just do it that way, and then let Congress and the town hall meetings debate themselves to death about whether the world is round--or whatever.

[miksmaster]

It's a sad, sad day. Not long ago, Obama had the country (at least 51% of it) eating out of his hand. Now, he's blowing it. Change means Change. A lot of folks got off their butts and voted for Obama "FOR CHANGE" and this is our reward: Letting Big Pharma call the shots. I would have expected this if McCain won - BUT HE LOST, didn't he? Sometimes I wonder who really won. When the Repubs had control of everything, they acted like it. (Even though it was sad to see them "rubber-stamp" every Bush-Cheney idea.) The Dems get control of everything and the first thing you hear about is Blue Dogs - going against the President and going along with the BIG CORPORATIONS. Dems better wake up. They are blowing it. Obama is blowing it. Give the Repubs one chance and they'll jam it down your (our) throats, AGAIN. Some dangerous person such as Palin or Romney will be able to waltz into the White House. We don't want that, do we? OBAMA! PELOSI! REID! WAKE UP! PLEASE. You are not fighting a typical "party". The Repubs are more dangerous now than they have ever been. They also control most of the media. Please, WAKE UP. Bipartisanship won't work with these people. What will it take for you to finally see that?

[Baja]

Continued...
Pharms are part of perhaps the most deadly parts of the Cigarette Industry (the chlorine-dioxin parts). The idea that probably they are up to here in Chlorine Technologies... industrial chlorine being the source of dioxin (remember Agent Orange,Love Canal, Times Beach etc?...or Rachel Carson?) is another un-addressed, thought integral topic. No good reason can explain this. Try to answer the question, " I ignore dioxin in smoke from typical cigarettes because___­__________­__________­_"

Further, many Pharms---u­nderstanda­bly---do not like the idea that a natural un-patented plant (be it tobacco or cannabis or peyote or whatnot) competes with their patented synthetic alternatives. Those Pharms aren't about Health...they are about profits, which means eliminating the competition.
In this case it's tobacco and natural nicotine...in others it's medicinal marijuana, and in others it's coca or peyote or betel nuts or khat...you name it. The War on Tobacco is a huge extension of the Drug War.
To stop Big Pharma--- to discredit that industry, one needs only ask about Big Pharma's Cigarette Connection, and about chlorine and dioxin and untested non-tobacco cigarette additives. Can't hurt to ASK. It can hurt many to NOT ask, however.

The matter of Insurers investing Billions or what was supposed to be our health care money into the cigarette industry AND in those Pharms and pesticide and chlorine industries is, of course, deeply related.
See material about insurers' investments in Big Cig. Google "PNHP NEJM tobacco insurance".

[wonketteRAWKS]

Guess Big Pharma is paying chess while Obama plays checkers!

[Baja]

Continued:
Pharm interests, most prominently the Robt Wood Johnson Foundation, are in the forefront of the War On Tobacco. The idea of Industrial­ly-Contami­nated Tobacco doesn't come into play. RWJF and their funding recipients have the job of blaming the natural tobacco plant, and smoking victims, for the effects of what might best be called "Pesticide Pegs" or "Dioxin Dowels".

That tactic has kept public eyes off the chlorine content of most (not all) cigarettes which is the source of cancer-causing, immune-suppressing, fetal-damaging, pregnancy-­disrupting­, sperm damaging, etc. dioxins in the smoke. Dioxins are impossible to be from tobacco or any natural plant.

Johnson & Johnson (origin of RWJF fortunes) makes Splenda sweetener, from two chlorine molecules. God Forbid that chlorine gets a bad rap for being easily the worst non-tobacco cigarette adulterant. J & J subsidiaries make patented, synthetic nicotine-delivery products...and have huge motive to eliminate competition...the non-patentable natural tobacco plant, and to make nature's nicotine a Controlled Substance.­..controll­ed only by the corporate sector. It's a part of the corporate war on, and privatization of, public everything.

Big Pharma is also in the Cigarette Industry represented by Bayer, BASF, Miles, Ciba Geigy, Zeneca , Syngenta, Rhone-Poulenc, Abbott Labs, Sandoz, Tuco, etc etc. None of them has been subpoenaed to any Smoking and Health hearings/
http://www.gao.gov/atext/d03485.txt (or Google "GAO tobacco pesticide residues")

[Baja]

Big Pharma may have been "handed everything it wanted" by legislators...but how many legislators were not already beholden to those pharms via campaign funding and personal investments? All? It's hard to imagine why such pre-bought legislators need the extra offers by lobbyists.
The most puzzling and tragic gift given to the Pharms has been, and continues to be, silence by the industry's ostensible critics concerning Big Pharma's dark side. Even the most active Single Payer supporters let the Pharms slide (out of jail) on this point. But maybe many Single Payer groups are set up by insurers and Pharms to be Ineffective Pretend opponents. It's quite unlikely that that ploy is not in play to whatever degree.

Many top pharmaceuticals are all-too-modest suppliers of pesticides to everyone's despised cigarette industry...some of those pesticides being chlorine chemicals that serve to put dioxins into the smoke, and into the lungs of unwitting and unprotected smokers. But, apparently, smokers have been so thoroughly de-humanized that even liberal progressive etc people don't care. But smokers were warned only about "smoking" (their personal behavior)....not about smoking pesticide residues and dioxins etc. There is a distinction.

Pharm industries also supply the reviled cigarette industry with artificial sweeteners, preservatives, flavorings, aromas, humectants, and god-knows what else...none of those things having been tested for safety in this use alone or in combo. Real Guinea Pigs get better protection, from animal rights activists etc, than the human versions.

[mardigraswizard13]

I'm amazed at how many people at health meetins are overweight and out of shape. People of all ages need to eat less and get more exercise.

[expired]

So, thanks to Rep. Anthony Weiner (D-NY), Speaker Pelosi says she will bring a vote to the floor on single-payer after the recess. Are you all ready to make those phone calls and write those letters?

Nancy's contact info..http://speaker.house.gov/contact/

Send our speaker an e-mail of encouragement.

[PaxEterna]

How come the Italians can buy Lipitor for 1/10th of what it costs Americans?

BECAUSE ITS GOVERNMENT STOOD UP FOR ITS PEOPLE.

No Leadership from Obama = No Reform.

Worse, NO LEADERSHIP FROM OBAMA = MORE GIVEAWAYS FOR THE CORPORATE ELITES.

[FrozenNorthObserver]

since HP has sat on this for a half an hour I'll try it again,,,the oldest and truest axiom in politics is "follow the money", one man tops all these lists.

Bi*g Pha*rma
http://www.opensecrets.org/industries/recips.php?ind=H04&cycle=2008&recipdetail=A&mem=Y&sortorder=U
http://www.opensecrets.org/industries/recips.php?ind=H4300&cycle=2008&recipdetail=A&mem=Y&sortorder=U

Healthcare Industry'
http://www.opensecrets.org/industries/recips.php?ind=F&cycle=2008&recipdetail=A&mem=Y&sortorder=U

Finance/In­surance/Re­al Estate:
http://www.opensecrets.org/industries/recips.php?ind=F&cycle=2008&recipdetail=A&mem=Y&sortorder=U

[JDM73]

Reform was made more difficult than it had to be--indeed, almost impossible--when single payer was removed from consideration. Anything else is a half-measure doomed to failure, a compromise that satisfies no one but the insurance and pharmaceutical companies.

[condor101]

I'm re-posting this link from below. Please watch the interview of Wendell Potter. He speaks the truth.
We need congress to vote for a Public Plan.

Right now, the insurance companies are salivating at the prospect of having the 50 million un-insured to be mandated to buy health insurance.

We need a Public Plan so that private insurance companies will have to compete and lower their premiums.

Wake Up People!
Do Something!
Please watch this video interview of Wendell Potter and then contact your congressma­­n/senator­, urging them to support a Public Plan.
Also, feel free to copy and re-post the video link below and/or my message and place on all comment boards on HuffPost.
We need to get more and more people to watch this interview and effect change.
Currently, the Corporate Beaurocrats and their Lobby are taking over town hall meetings and influencing the general public to be scared of a Public Plan. We need to take control of this debate and show the Real Truth.

If you haven't seen Bill Moyers' interview with Wendell Potter, former PR executive for CIGNA, I strongly recommend it:
http://www.pbs.org/moyers/journal/07102009/watch2.html

[thefoundersrock]

And yet, you trust the same government with life and death health care decisions. Talk about WAKE UP!

[HillaryPres2012]

Are you still using that worn 50 million uninsured line? Read the census report that it comes from. That number includes illegal aliens, seniors who quality for medicare, workers that lost their job but were rehired and and got back their insurance during the census year, people who make over $50K a year and choose not to get insurance. The real number is closer to 16 million. We could have easily handled that number by applying the unaccounted stimulus bill money.

[eahce]

Big Pharma money talks load and clear in Washington at the expense of people's well being. It would be great if Obama could show some integrity and bring change like he promised and has yet to deliver.

[FrozenNorthObserver]

guess who Big Pha*rma's top 08 recipient was,
http://www.opensecrets.org/industries/recips.php?ind=H04&cycle=2008&recipdetail=A&mem=Y&sortorder=U
http://www.opensecrets.org/industries/recips.php?ind=H4300&cycle=2008&recipdetail=A&mem=Y&sortorder=U