Copyright 2000 Star Tribune
Star Tribune
(Minneapolis, MN)
August 27, 2000, Sunday, Metro Edition
SECTION: NEWS; Pg. 1A
LENGTH: 1964 words
HEADLINE:
Drug firms flex their political muscles;
Industry has many
weapons this election year, including strong ties with Lieberman.
BYLINE: Greg Gordon; Kristin Gustafson; Staff Writers
DATELINE: Washington, D.C.
BODY:
Sen. Joseph Lieberman has flown on Pfizer
Inc.'s corporate jet, spoken before the pharmaceutical industry's trade
association and accepted more than $161,000 in campaign
donations from prescription drug makers since 1993.
While Lieberman, D-Conn., hasn't
always sided with the drug makers, congressional watchdogs say
their relationship with Al Gore's vice presidential pick could be just one more
weapon as the industry prepares to fight an expected election-year firestorm
over soaring drug prices and calls to expand Medicare
drug coverage.
Lieberman's presence on the ticket
"could make it more difficult for the Gore campaign to make anti-pharmaceutical
industry themes a centerpiece of the presidential campaign," said the Pink
Sheet, an industry trade journal.
The pharmaceutical industry _ one of
the nation's most profitable _ has been deploying a multiweapon arsenal to
protect its franchises. They have:
-
Hired nearly 300 lobbyists on drug pricing issues, including
former Minnesota Republican Rep. Vin Weber and several other ex-members of
Congress for whom doors open on Capitol Hill.
- Spent more than
$11 million in "hard" and unregulated "soft" political
donations since Jan. 1, 1999 _ $8 million to Republicans and
$3.3 million to Democrats, according to the Campaign Study
Group.
- Underwritten lavish events
at both national political conventions, including co-sponsorship by Merck &
Co. and Bristol-Myers Squibb Co. of a Mardi Gras-style gala on Paramount Studios
sets at the Democrats' extravaganza in Los Angeles.
- Bankrolled tens of millions of
dollars in TV and radio ads in which Citizens for Better Medicare, a nonprofit
group financed almost entirely by the pharmaceutical industry, has attacked
President Clinton's and Gore's proposals for a government-run prescription
drug program.
Steve
Weissman, a legislative representative for the consumer group Public Citizen,
calls the pharmaceutical lobby "an elephant among chickens" that overwhelms
opposition from smaller advocacy groups.
"You have every poll showing that
most people would like the prescription drug benefit," he said.
"They are concerned about this. And yet we don't have it."
.
Patent victories
As evidence of the
drug lobby's effectiveness, critics cite pharmaceutical
companies' success at winning patent extensions that prevent
competition from cheaper generic drugs. In July, Sen. John
Ashcroft, R-Mo., signed onto legislation that would boost Schering-Plough
Corp.'s bid for a five-year patent extension for its
blockbuster allergy drug Claritin. The same month, the company
plunked $50,000 into a joint soft money account set up by
Ashcroft and the National Republican Senatorial Committee to aid his reelection
bid.
Public Citizen reported
recently that Sen. Orrin Hatch, R-Utah, the chairman of the Senate Judiciary
Committee that handles most patent legislation, is Congress'
leading recipient of drug industry money. Besides the
$125,215 sent to his Senate campaign since Jan. 1, 1999,
pharmaceutical company PACs and executives gave his aborted presidential
campaign $88,000.
Judith Bello, executive vice
president of the Pharmaceutical Research and Manufacturers of America, the
industry's trade association, declined to discuss specifics of its lobbying over
Medicare drug benefits.
She said lobbyists for the group and
some of its more than 40 member companies meet almost daily at the association's
Washington offices.
"Our role is to
try to make it as balanced a debate as possible," she said. "It's an election
year, and politics affects rhetoric."
This year's political climate is
probably the most hostile yet facing the drug makers, who have
been confronted with a major regulatory threat about every 10 years since the
late 1950s, said Stephen Schondelmeyer, director of the Prime Institute at the
University of Minnesota's College of Pharmacy.
"It's like a wave that's coming in
from the ocean on this 10-year cycle," Schondelmeyer said. "The waves are
getting bigger."
Trade association
spokeswoman Jackie Cottrell said House Democrats, believing the issue can help
them regain the majority they lost in 1994, "have made us public enemy No. 1."
Cottrell said most congressional
districts have no pharmaceutical facility, so it's easy to portray a
drug maker as a "nameless, faceless, big corporate giant that
makes a lot of money" rather than as the company that developed a treatment or
cure for a disease.
Reciting the
industry's mantra, Bello and Cottrell said foreign price controls have forced
drug manufacturers to charge U.S. consumers more so they can
finance research and development, which led to FDA approval of 370
drugs during the 1990s.
But Schondelmeyer said there are
reasons for the growing clamor, most notably that 80 million to 90 million
Americans lack prescription drug coverage, others' lack
adequate coverage and thus many people can't afford the medicine they need.
In addition, he said, corporations
are entering the debate because they are facing average annual increases of 15
to 25 percent in their prescription drug costs. General Motors
Corp., U.S. West and other companies have joined a coalition seeking to contain
the surging use of pricey new drugs peddled in industry ads
when older, cheaper drugs are equally effective.
The surges in prices and use have
boosted U.S. expenditures on prescription drugs from 7 percent
of the nation's health care budget in the early 1990s to 10 percent, or
$101 billion, last year. If more people are covered, the figure
will rise further, as it did for 34 Minnesota companies that belong to the
Buyers Health Care Action Group. The comprehensive drug
benefits that they provide to 140,000 employees and family members account for
15 percent of health care costs, said Steve Wetzell, the group's executive
director.
.
Candidates weigh in
With public opinion polls ranking
the issue near the top of voters' concerns, both Gore and his Republican rival,
Texas Gov. George W. Bush, have pledged to act on competing plans to expand
coverage for the elderly.
Congressional candidates also are
jumping on the theme. Minnesota Democratic senatorial candidate Mark Dayton is
sponsoring "RX Express" bus trips to Canada, where seniors can buy
drugs at big savings. Rep. Gil Gutknecht, R-Minn., spent a week
of Congress' August recess on a seven-city "prescription drug
tour" of his district.
The
industry's strategy has been to line up support from Bush and congressional
Republicans for a plan that passed the House with support from a lone Democrat:
Minnesota Rep. Collin Peterson. It offers subsidies to encourage private health
insurers to provide low-cost drug coverage to seniors. The
bill's chief sponsor, GOP Rep. Bill Thomas of California, the chairman of the
Ways and Means Committee's health subcommittee, has received
$160,665 in drug industry donations since
1993, the most among House members.
Clinton has vowed to veto the House
measure, saying that a government-run program providing drug
coverage for the nation's 39 million Medicare enrollees would have the
bargaining clout needed to hold down prices.
Schondelmeyer contended that the
industry favors the GOP privatization plan because it would "segment the
market," or limit the leverage of any one buyer _ a tactic pharmaceutical
companies have used for years. Drug companies have been so
successful with this approach, Schondelmeyer said, that few people beyond
pharmacists can keep a handle on drug prices.
With the Medicare legislation mired
in partisan gridlock, the House and Senate have passed different versions of
bipartisan legislation that would allow pharmacists to "reimport"
drugs exported to Canada, Mexico and other foreign countries,
where they are sold at a small fraction of U.S. retail prices.
Schondelmeyer said such legislation
may pass but predicted that industry-backed amendments would minimize or delay
the impact.
.
Lobbying lineup
The drug industry
has assembled a formidable lineup of lobbyists to try to block the
"reimportation" bills and influence the Medicare debate.
The trade association paid
$120,000 during the last six months of 1999 to Weber and his
colleagues in the firm of Clark and Weinstock, including Mitch Bainwol, a former
chief of staff to the Senate Republican Conference who helped shape the GOP
plan; Ed Kutler, who was an aide to former Speaker Newt Gingrich, and former
Democratic Rep. Vic Fazio of California.
Pfizer, based in Lieberman's home
state of Connecticut, has employed former Democratic Sen. Dennis DiConcini of
Arizona and former GOP Rep. Norman Lent of New York as well as Orrin Hatch's
son, Scott Hatch. Merck has employed former Democratic Rep. Tom Downey of New
York, a close adviser to Gore.
In
the face of such a powerful industry lobby, Schondelmeyer said he believes a
solution to the prescription drug problem for elderly Americans
is still two to three years away.
But, he said, he hopes Congress
first will reform campaign finance laws to reduce the industry's influence.
Then, he said, whatever drug program is adopted "will be less
influenced and better public policy."
.
.
The
drug lobby
.
The consumer watchdog group Public
Citizen recently reported that in 1999 nearly 300 registered lobbyists
represented the pharmaceutical industry. Many of them are former members of
Congress, congressional aides or executive branch officials. Here are some of
the figures representing the industry's trade group and a few
drug makers:
<PRE>.
Lobbying firm and
representatives Clients
.
Clark & Weinstock
Former Rep. Vin Weber,
R-Minn.; Pharmaceutical
Research and
Ed Kutler, assistant to
former Manufacturers
of America (PhRMA);
House Speaker Newt Gingrich,
R-Ga.; Schering-Plough Corp.
Mitch Bainwol, former chief of staff,
House Republican
Conference
.
Podesta.com
Anthony Podesta, former
aide PhRMA,
Novartis, Genetech, Eli-Lilly
to Sen. Edward Kennedy, D-Mass.,
brother of White House chief of staff
John Podesta
.
Greenberg-Traurig
Howard Cohen, former GOP
counsel, PhRMA, Merck &
Co., Amgen
House Commerce Committee
.
Steelman Health
Strategies
Deborah Steelman, former
official, PhRMA, Wyeth-Ayerst,
Johnson &
Office of Management and Budget
in Bristol-Myers Squibb,
Johnson, Bush
administrations Pfizer
.
Lent & Scrivner
Former Rep. Norman Lent,
R-N.Y. Pfizer
.
Parry & Romani
Former Sen. Dennis Deconcini,
D-Ariz.; Pfizer
Tom Parry, former aide to Sen.
Orrin Hatch, R-Utah;
Scott Hatch, Sen. Hatch's son
.
Canfield & Associates
Roger Blauwet, former tax
counsel, Merck
Sen. Max
Baucus, D-Mont.
Daniel Crane, former legislative
director, Rep.
John LaFalce, D-N.Y.
</PRE>.
Sources: Star Tribune
research, Public Citizen.
.
.
Rx for campaigns?
Prescription drug makers
have poured more than $11 million into national Republican and
Democratic campaign committees and congressional campaigns since Jan. 1, 1999,
most of it going to the GOP. Here is a summary:
<PRE>.
Individual Political Unregulated Totals
donations action "soft
money"
to
candidates committee donations
and
parties donations
Republicans $977,079 $2,349,558 $4,715,172 $8,041,809
Democrats $596,503 $
839,606 $1,871,735 $3,307,844
</PRE>.
Source: Campaign Study Group analysis of reports
to Federal Election Commission.
GRAPHIC: CHART; PHOTO
LOAD-DATE: August 28, 2000 
