Drug Industry Seeks Ways to Capitalize on Election Success
Baby Peanut
November 21, 2002
By ROBERT PEAR and RICHARD A. OPPEL Jr.
WASHINGTON, Nov. 20 - Having spent more than $30 million to
help elect their allies to Congress, the major drug
companies are devising ways to capitalize on their
electoral success by securing favorable new legislation and
countering the pressure that lawmakers in both parties feel
to lower the cost of prescription drugs, industry officials
say.
The industry's hand appears stronger now than at any other
time in recent years, a result of its large donations to
political parties and candidates and millions of dollars
spent on television advertising by industry-financed
groups. The money was spent overwhelmingly on behalf of
Republicans, who now control both houses of Congress.
Executives of the major drug manufacturers met last week at
the Westfield International Conference Center, near Dulles
International Airport in Northern Virginia, to plan ways to
turn that influence into legislative victories.
The executives included Robert Essner, president of Wyeth;
Peter R. Dolan, chairman of Bristol-Myers Squibb; Sidney
Taurel, chairman of Eli Lilly; and Raymond V. Gilmartin,
chairman of Merck. They discussed specific ways to leverage
their investment in this year's elections to advance their
agenda on Capitol Hill, participants said.
The meeting was described by an industry lobbyist as a
"strategic planning retreat" and "deep philosophical
conversations about our message for 2003." A pervasive
theme was how to block proposals that could erode profits
by limiting drug prices or making it easier for people to
buy low-cost generic versions of brand-name medicines.
Drug industry executives who attended the conference, put
on by the industry's main lobbying arm, the Pharmaceutical
Research and Manufacturers of America, said they were
delighted with the election results, yet cautious and
apprehensive, given the pressure that Republicans as well
as Democrats face from voters demanding lower drug prices.
"Sure, we will have more access," one executive said. "Our
hand is stronger because of the election results, but who
knows how much stronger it really is."
Already, industry executives have been encouraged by a
recent move to insert a provision in the domestic security
bill limiting the legal liability of vaccine manufacturers
like Eli Lilly. On Tuesday, several senators from both
parties said Republican leaders had promised to alter the
provision next year, so it would apply only to vaccines
made in the future.
But today, aides to Representative Tom DeLay, the incoming
House majority leader, said Mr. DeLay had agreed only to
consider such proposals. Aides to several Republican
senators troubled by the provision said they were confident
that the deal would stand.
Senator Byron L. Dorgan, Democrat of North Dakota, a
frequent drug company critic, said: "With the election,
they certainly have more friends in Congress. They should
be feeling their oats these days."
The pharmaceutical industry topped the Fortune 500 list of
the most profitable industries, providing investors with an
18.5 percent return on revenues last year. But many drug
companies report sagging profits in 2002.
The industry's No. 1 goal is to shape legislation that both
parties advocate to provide prescription benefits to the 40
million elderly and disabled people in the Medicare
program. What the industry fears most is price controls or
any federal effort to establish a list of preferred drugs
that leaves out other medications.
Democrats want to give the government a large role in
managing Medicare drug benefits, while Republicans would
rely more on competing private health plans, insurance
companies and pharmaceutical benefits managers.
The industry is also fighting legislation that would speed
the approval and marketing of generic drugs. The Senate
passed such a bill in July, with support from 49 Democrats
and 28 Republicans, but it died in the House.
So far, most Republicans have backed the brand-name drug
industry in its battle with generic drug makers. But
brand-name drug makers worry that the pressure to limit
drug spending, and the cost of Medicare drug benefits, will
lead more Republicans to promote the use of generic drugs.
The industry's agenda also includes these items:
śDrug
companies adamantly oppose legislation making it easier for
consumers, pharmacists and wholesalers to import drugs from
Canada, where prices are usually lower. Such imports could
endanger public health, they say.
śDrug makers oppose Congressional efforts to limit or
discourage drug advertising on television and in newspapers
and magazines. Drug makers say such advertisements convey
useful information, but critics say they contribute to
explosive growth in drug spending.
śMany pharmaceutical companies want to limit damages in
lawsuits filed by people who say they have been injured by
the use of certain drugs. Many drug makers have been named
as defendants in class action suits.
Representative Rob Portman of Ohio, part of the House
Republican leadership team, said, "There is a consensus now
in Washington, not just in the House but in the Senate and
at the White House, that we need to provide seniors with a
prescription drug benefit under Medicare."
On Oct. 21, President Bush proposed a regulation to get
generic drugs to the market faster. Mr. Portman said, "It's
possible we could see legislation there as well," to codify
the president's proposal, or something like it.
Over all, the pharmaceutical and health products industry
gave about $20 million this year to House and Senate
campaigns and national political parties, with
three-fourths of the money going to Republican candidates
and party committees, according to the nonpartisan Center
for Responsive Politics. Top donors included Eli Lilly,
Bristol-Myers Squibb, Pfizer and GlaxoSmithKline.
While those contributions put the industry among the
largest donors, the totals actually understate its
influence in Washington. In the last six years, according
to Public Citizen, the group founded by Ralph Nader, the
industry has spent close to $500 million on lobbying,
including 600 lobbyists that includes about two dozen
former members of Congress.
The industry has directed much of its largess to lawmakers
who control the fate of legislation affecting prescription
drugs. The chairman of the Senate Finance Committee, Max
Baucus, Democrat of Montana, received $114,000 in
contributions from executives of drug companies and
manufacturers of health care products and from industry
political action committees through Oct. 21, according to
the Center for Responsive Politics. The panel's senior
Republican, Senator Charles E. Grassley of Iowa, who is
soon to be chairman, took in about $100,000.
In the House, the chairman of the Energy and Commerce
Committee, Representative Billy Tauzin, Republican of
Louisiana, received about $100,000. Representative John D.
Dingell of Michigan, the panel's senior Democrat, received
a similar amount.
Through Oct. 21, the largest recipient of direct
contributions from the pharmaceuticals and health products
industry - close to $200,000 - was Representative Nancy L.
Johnson, the Connecticut Republican who is chairwoman of
the Ways and Means Subcommittee on Health.
Mrs. Johnson, who won re-election by defeating
Representative Jim Maloney, a Democrat, also benefited from
almost $700,000 that United Seniors spent on television
advertisements in Hartford in the last two months of the
campaign, according to the Wisconsin Advertising Project of
the University of Wisconsin in Madison.
http://www.nytimes.com/2002/11/21/politics/21DRUG.html?ex=1038907251&ei=1&en=b55432190f8d4c8e
Gary Stein
$30 million back 100 fold or more due to the Republican parties pro-business
anti-consumer agenda. The so called prescription drug plan of the
Republicans was tried in Nevada and was a total failure not a single
insurance company offered coverage and the Nevada plan was almost identical
to the one passed by the house republicans at the federal level.
There will be more legislation banning the reimportation of drugs from
Canada, and further patent extensions and more restrictions on the Generic
drug market. Oh well the electorate has spoken and we have only ourselves to
blame. Voter turnout for liberals was substantially bellow that of
conservatives in most of the hotly contested seats.
Gary Stein
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