By Robert Pear
May 6,
2018
WASHINGTON — In his State of the Union address in January and
again in New Hampshire in March, President Trump made a bold promise: “You’ll
be seeing drug prices falling very substantially in the not-too-distant
future,” he said, “and it’s going to be beautiful.”
Not if the pharmaceutical companies can stop it.
Big Pharma is pouring money into a lobbying campaign to thwart
any serious efforts to rein in prescription drug prices ahead of a presidential
speech this month where Mr. Trump plans to lay out his drug pricing proposals.
“There is apprehension across the industry,” said Bruce Artim,
who retired recently after 11 years as the director of federal affairs at Eli
Lilly and Company. “Pharma folks are nervous.”
Drugmakers spent $171.5 million lobbying the federal government
last year — more than insurance, electronics, oil and gas or any other
industry, according to data compiled by the Center for Responsive Politics, an
independent group that tracks money in politics.
Spending by the main lobby for the industry, the Pharmaceutical
Research and Manufacturers of America, surged in the first quarter of this
year, to $10 million, up from $8 million in the first quarter of last year and
$6 million in the first quarter of 2016, the trade association said in reports
filed with Congress. Its spending is on pace to top the annual totals it
reported in recent years, $25.4 million in 2017 and $19.6 million in 2016.
Drug companies and their trade associations deployed 882
lobbyists last year, more than two-thirds of whom had previously worked for
Congress or federal agencies, the center said.
And as Mr. Trump moves to flesh out one of his more popular
campaign promises, drugmakers may have reason to mobilize. During the
presidential campaign, Mr. Trump embraced positions on this issue long held by
Democrats — and long opposed by his party and the pharmaceutical industry. He
said, for example, that Medicare officials should negotiate prices with drug
manufacturers, and that consumers should be allowed to import prescription
drugs from Canada and certain other countries where brand-name drug prices are
generally lower than in the United States.
The American people are very likely to back him. A recent poll
by the Kaiser Family Foundation found that 80 percent of Americans believe that
drug costs are unreasonably high.
“The president’s concerns are born out of this populist impulse
that we have to acknowledge: that patients are paying more for their health
care, more for their medicine,” said Stephen J. Ubl, the president and chief
executive of the Pharmaceutical Research and Manufacturers of America.
Efforts to attack the problem, even by the president, face stiff
headwinds. The numbers bear out Mr. Trump’s statement that “pharma has a lot of
lobbies and a lot of lobbyists and a lot of power.”
With its deep pockets and sophisticated lobbying, the drug
industry has beaten back many efforts to reduce the payments it receives from
Medicare, Medicaid and other government programs.
“Big Pharma has made a huge investment in Congress, with
extensive lobbying and massive campaign contributions,” said Representative
Lloyd Doggett, Democrat of Texas.
Still, the industry is not immune. Drugmakers suffered a major
setback in February when Congress required them to give deeper discounts to
Medicare beneficiaries.
The action by Congress, which will cost drugmakers billions of
dollars, “scared the bejesus out of them,” said Jayson S. Slotnik, a consultant
to drug and medical device companies.
They are now worried about the proposals Mr. Trump may push to
lower drug prices. Their anxiety is heightened by Mr. Trump’s unpredictability.
Drug company lobbyists say they are confident that Mr. Trump’s
campaign ideas will not be endorsed by Alex M. Azar II, the secretary of health
and human services, who
used to work at Lilly, or Dr. Scott Gottlieb, the commissioner of
the Food and Drug Administration, who was a frequent consultant to drug
companies before he returned to government last year.
But the lobbyists worry that Mr. Trump could easily veer off
script, either on Twitter or in extemporaneous remarks in the coming weeks.
The Trump administration, like the Obama administration, has
made clear that it wants to slow the growth of spending on drugs under Part B
of Medicare, which covers many cancer drugs and other expensive medicines
administered in doctors’ offices.
The reimbursement formula used in this part of Medicare creates
“perverse incentives for prescribing higher-priced drugs” and discourages drug
companies from competing on price, the White House Council of Economic
Advisers said
in a recent report.
Some of the alternatives being considered by the Trump
administration, to inject competition into Part B of Medicare, have caused
concern among drugmakers.
Drugmakers that spent the most on lobbying last year included
Amgen ($10.6 million), Pfizer ($10.5 million) and Novartis ($8.6 million).
Lobbying is just one way drugmakers and their employees can
exert influence. They also make campaign contributions, spend large sums on
advertising and donate to patient advocacy groups whose members depend on the
drugs they make.
Campaign contributions since January 2015 total $31 million,
according to the Center for Responsive Politics — compared, for example, with
$58 million from the commercial banking industry. Kantar Media, an ad tracking
company, says that drug companies spent $6.1 billion on advertising aimed at
American consumers last year, more than twice as much as the nation’s largest
corporate advertiser, Procter & Gamble.
Every major industry lobbies for its interests, but
congressional aides said that lobbyists for pharmaceutical companies were
special: They outnumber the lobbyists for many other industries. Congressional
aides said it was not unusual for the industry to dispatch 10 or 15 lobbyists
to meet with two congressional aides.
In addition, they said, drugmakers are fierce opponents of
proposals they dislike, and are often reluctant to suggest alternatives of
their own when Congress is seeking ways to save money.
The pharmaceutical industry’s intransigence has begun to irk
even staunch Republican allies. It contrasts with the industry’s support for
adoption of the Affordable Care Act in 2009 and 2010 and its role in shaping
the prescription drug benefit added to Medicare under a 2003 law.
Drug companies say their lobbying reflects the fact that they
are concerned about myriad issues, including Medicare and Medicaid, trade and
taxes, patent rights, drug regulation, opioids and the budget for biomedical
research.
They have prepared an elaborate response to criticism of their
pricing practices.
In an ad campaign, drugmakers boast that they are producing
cures and treatments for cancer, hepatitis C and other diseases.
They blame “middlemen” — insurers and pharmacy benefit managers
— for the high costs that consumers often incur. High-deductible health plans,
which may require consumers to spend thousands of dollars out of pocket, are
another culprit, they say.
The industry has a bipartisan stable of lobbyists who worked on
health legislation for influential members of Congress.
A longtime aide to former Representative John D. Dingell,
Democrat of Michigan, works for the Pharmaceutical Research and Manufacturers
of America. An aide to former Senator Tom Harkin, Democrat of Iowa, who was the
chairman of the Senate health committee, is now a top lobbyist for Merck.
The door swings in both directions. For six years, Gary Andres
was the Republican staff director of the House Energy and Commerce Committee,
which is responsible for legislation that affects prescription drugs and the
F.D.A. In February 2017, he became a senior executive vice president of the
Biotechnology Innovation Organization, a trade group that lobbies for biotech
companies.
Then he returned last month to Capitol Hill to become the
Republican staff director of the Ways and Means Committee, which has
jurisdiction over Medicare, including its payments for prescription drugs.
Ryan Long, former chief health counsel at the Energy and
Commerce Committee, joined BGR Government Affairs in February 2013. In lobbying
disclosure reports filed by BGR, he was listed as a lobbyist for Amgen,
Celgene, Gilead, Lilly and Merck, among other clients. He returned to the
committee this March as the deputy staff director.
Retired lawmakers also show up as lobbyists.
Among those who are listed as having lobbied for the
Pharmaceutical Research and Manufacturers of America in recent years are former
Senator Jon Kyl of Arizona and former Representative Bill Paxon of New York,
both Republicans. Former Representative Ed Whitfield, Republican of Kentucky,
is listed as lobbying for AstraZeneca, Genentech and Johnson & Johnson,
among other companies.
Whether that firepower will still be effective is an open
question.
“Nearly every major decision in this administration so far has
favored the pharmaceutical industry,” said Ronny Gal, a securities analyst at
Sanford C. Bernstein & Company. “But investors are apprehensive about the
long-term horizon. Every other country has acted to control drug costs, and the
view is that eventually the United States will have to do so.”
A version of this article appears in print on May 6, 2018,
on Page A12 of the New York edition with the headline: Drug
Firms Gearing Up For a Fight Over Prices. Order Reprints | Today’s Paper | Subscribe
https://www.nytimes.com/2018/05/06/us/politics/trump-drug-prices-lobbying.html?partner=rss&emc=rss&itx[idio]=8812325&ito=792&itq=67b0bb6c-eff6-4353-b92f-f28bd514a4a7
No comments:
Post a Comment