Resurgence of Pharma Lobbying Spending

Resurgence of Pharma Lobbying Spending

According to Open Secrets, which tracks industry lobbying, "the pharmaceutical industry as a whole spent $69.6 million on lobbying in the first three months" of 2012 (see "Pharma, Utilities and Big Ag Lead Lobbying in 2012"). Included in that category are "Health products" other than Rx medicines. Looking at just "Pharmaceutical Manufacturers" (including PhRMA, the drug industry's U.S. trade association), the total lobbying spend in the first quarter of 2012 was $48.1 million.

Here's a chart of the biggest spenders in this category so far:

Annual pharmaceutical lobbying -- as measured in dollars -- increased more or less steadily since 1998, but peaked in 2009 at $186.1 million. If the spending in 2012 continues at the pace of the first three months, the pharmaceutical industry will spend approximately $192.4 million in lobbying for the year (see chart; the 2012 bar is projected as 4 X Q1).

Open Secrets contends that the pharmaceutical industry is "clearly focused on protecting the existing provisions of Medicare Part D, which subsidizes the cost of drugs. Critics in Congress have targeted the program for its huge cost, and some want it to be more transparent about how reimbursements are set. Also at issue," says Open Secrets, "is whether the government should be able to negotiate drug prices with the companies, something that is currently prohibited."

The pharmaceutical industry is keen on preventing changes to Medicare -- especially changes that would allow the government to negotiate prices. Back in October, 2011, the Campaign for Modern Medicines (@Modernmeds) and Eli Lilly & Company (@LillyPad) hosted at least one Tweetchat on Medicare Part D to "help raise awareness on the value of the current system, and to learn how to prevent potential changes to it" (see "More Pharma Twitter Chats: Medicare is Topic" and "Was Lilly's #mmeds Twitter Chat a Discussion or a Press Conference?").

Although it is difficult to link lobbying spending with specific bills in Congress, the drug industry -- especially through PhRMA -- is also lobbying hard to get a favorable PFUFA (FDA funding) bill passed (see, for example, "Angry PhRMA, Level 1: PDUFA").

Of course, 2012 is also a presidential election year and that will likely keep lobbying -- including donations to candidates and their political parties -- at a high level throughout the year. Here's some interesting data showing the trend in pharma donations by political party (see more such data here):

It seems that the drug industry was intent on getting Republicans elected in 2000 and 2002 and when that was accomplished, they cut back and reaped the benefits of the status quo, or as some would say the "do nothing" Congress.

Is Pharma Part of Problem or Solution to Current State of US Economy?

Is Pharma Part of Problem or Solution to Current State of US Economy?

When Americans were asked "Thinking about the role each of the following sectors played in the current state of the American economy, do you think each of the following sectors is a part of the problem, a part of the solution, or are you unsure?," only 15% said the pharmaceutical industry was part of the solution, according to the 2012 Harris Poll Annual RQ survey. 50% said the industry was part of the problem (see chart below):

According to Harris, that puts the drug industry on the cusp of being a "malefactor" - an industry that Americans blames for economic woes. You can find the complete Harris report here.

Meanwhile, PhRMA, the industry's trade association in the U.S., continues to churn out press releases that warns Americans that if the government passes such-and-such law or over-regulates such-and-such activity of the pharmaceutical industry, it will result in the loss of thousands, nay millions!, of American jobs.

For example, in a response to the President's Fiscal Year 2013 Budget, PhRMA stated "America's biopharmaceutical industry is a key driver of economic growth; the President's proposed budget would weaken our ability to innovate and create jobs. This is not an investment in America's future and these proposals should not be considered" (see "PhRMA Statement on the President's Fiscal Year 2013 Budget").

Of course, the drug industry can be both part of the solution and part of the problem. It depends on whose problem/solution you are talking about.

It's part of the solution for white collar workers who work in the U.S. pharma industry, have Rx medical coverage, and can afford prescription drug co-pays. Blue-collar workers and retired folk who depend more on government "safety nets," however, may see  high drug prices and the drug industry's antipathy toward Medicare rebates as part of the problem. The latter are not among the typical U.S. pharma work force since the drug industry is shipping more and more blue-collar manufacturing jobs overseas to countries like China.

Not only does this NOT support jobs in the U.S., it also endangers our drug supply.

In a story about counterfeit Avastin in the U.S., the link between overseas drug manufacturing and counterfeit or tainted drugs in the U.S. was suggested: "Most Americans don't question the integrity of the drugs they rely on. They view drug counterfeiting, if they are aware of it at all, as a problem for developing countries. But the latest incident, which follows the appearance of other fake drugs in the U.S.—including counterfeits of the weight-loss treatment Alli and the influenza treatment Tamiflu—suggests it is a growing risk, especially as more medicines and drug ingredients sold in the U.S. are made overseas [my emphasis; see "Roche warns of fake cancer drug in US"). For more on this, see "Unsafe Drugs: Is It Counterfeiters or the Supply Chain That's the Problem?"

Is Pharma Part of the Problem or Solution to America's Economic Woes?
	Solution
	Problem
	Both, as you say
	Unsure

Was Lilly's #mmeds Twitter Chat a Discussion or a Press Conference?

Was Lilly's #mmeds Twitter Chat a Discussion or a Press Conference?

Yesterday, I participated in the #mmeds Twitter chat regarding Medicare hosted by Lilly (see "More Pharma Twitter Chats: Medicare is Topic"). I had high hopes that this would be an informative discussion, but those hopes faded once the official "chat" began.

Before the chat began, Lilly encouraged followers to ask questions: "Hope you can join @Modernmeds for a Twitter chat on #Medicare tomorrow at 4:00. Ask questions now via #mmeds" @Modernmeds is the Twitter account associated with The Campaign for Modern Medicines, which is sponsored by Eli Lilly and Company.

The TOP TEN contributors (in terms of posts made) to the #mmeds chat were:

1.  @Modernmeds 
2.  @pharmaguy 
3.  @LillyPad 
4.  @WVRx 
5.  @HoosiersWFH 
6.  @PhRMA 
7.  @GHLForg 
8.  @mikecapaldi 
9.  @Outlandes 
10.  @patientaccess

I am #2 primarily because I kept asking questions, many of which went unanswered, such as:

• What's Lilly's position viz-a-viz republican proposals to privatize Medicare or raise premiums for higher-income seniors?
• To reduce deficit, should gov't raise the age of Medicare eligibility to 67 from 65?
• Who wants to "break" Medicare Part D and how exactly? Let's go lite on the buzz words, pls. (posted in response to @Modernmeds tweet: "Medicare Part D is a government program that is not broken; let's not break it.")
• why does pharma think Part D is at risk of being "broken?"
• Can you summarize the "proposed changes" u are talking about please? (posted in response to @Modernmeds tweet: "The proposed changes would also cause higher Part D premiums for seniors.")

Finally, @Lillypad got so disgusted, it tweeted "we understand that you may not agree with us-- this is a discussion!" to which I replied "I haven't disagreed with anything u hv said so far - none of my Qs have been addressed."

I wasn't the only one to ask questions. Just before the official chat began, @ellsbelles3 posted this question: "I keep hearing that Medicare Part D is working and not to change it. what does that mean?" This sounded suspiciously like a setup from a phony ordinary citizen similar to "Joe the Plumber."

I immediately opened up @ellsbelles3's Twitter profile and found that despite the fact that the account was opened up more than 6 months ago, this was @ellsbelles3's FIRST and only tweet!

I just had to ask her: "@ellsbelles3 C'mon... you're a PhRMA agent, right? #mmeds". No answer.

That's @ellsbelles3 profile photo above (entitled "xmas_card_reasonably_small.jpg"). She's located in Washington, DC. The vast majority of people that @ellsbelles3 follows on Twitter are politicians and media correspondents -- exactly the types of people a public policy wonk like Amy O'Connor (aka, @Modernmeds and @LillyPad) would follow. In fact, Twitter says @aoconnorND (Amy O'Connor's personal Twitter account) is an account with a very similar profile to @ellsbelles3. So, sorry, Amy. You don't work for PhRMA (directly).

During the chat @Modernmeds and @PhRMA pushed out talking points such as "Medicare Part D is a government program that is not broken; let's not break it.", "Medicare Part D works, has high satisfaction rates, and the select committee should avoid mirroring Medicaid", "Recent #JAMA study found access to Part D saves $1200/yr per senior in healthcare costs", and "We are supportive of a market based system for Medicare Part D." @LillyPad mostly RT'd these points.

Eventually, I figured out what Lilly et al were most concerned about: a proposal by lawmakers (democrats, I presume) to require pharma companies to offer "rebates" to help cover the out-of-pocket costs incurred by seniors who find themselves in Medicare Part D's infamous "doughnut hole" (ie, where Medicare no longer pays for meds). The industry labels this proposal "price controls."

In the end, after 30 minutes, we all agreed that the discussion just began. I wish there was more discussion in the beginning rather than the very end. I tried my best, but it's difficult when the chat organizers have an agenda and dominate the "discussion" with talking points, buzz phrases, and calls to action.

Lilly et al obviously have a different view of what a Twitter chat should be than do I. To them it's a press conference, not a conversation. Like a press conference, they can duck tough questions or just ignore inquisitive journalists (and bloggers) in the "audience." In fact, that's what I felt like during this chat: just another member of the "audience" who is expected to soak up and repeat talking points.

"We will have a chat next Wed at 10 AM, with our President of Lilly USA, Dave Ricks," said @Modernmeds at the end of yesterday's chat. Unfortunately, Mr. Ricks won't be using his own Twitter account (I don't believe he has one), but will "he will be using @Modernmeds's Twitter handle next week," said @Modernmeds. Which leads me to question whether Dave Ricks will actually participate in the chat or if @Modernmeds (Amy O'Connor) will just play the part of Dave Ricks (ie, be his "mouthpiece" as they say in the PR world).

More Pharma Twitter Chats: Medicare is Topic

More Pharma Twitter Chats: Medicare is Topic

The Campaign for Modern Medicines (@Modernmeds) and Eli Lilly & Company (@LillyPad) will host two separate Tweetchats on Medicare Part D to "help raise awareness on the value of the current system, and to learn how to prevent potential changes to it." As reported by PhRMA in a blog post (see "Join the Chatter on Medicare"), "the first chat will be held on Thursday, Oct. 13th from 4-4:30PM EST, with Bart Peterson, Sr. Vice President of Lilly Corporate Affairs & Communication" and the second will be held on Wednesday, Oct. 19th at 9-9:30AM EST "to share your thoughts on the economic implications of proposed changes to Part D, with President of Lilly USA, Dave Ricks as host." Join the conversation using the hash tag #mmeds.

The latter chat is a milestone because it is the first time ever that the president of a pharmaceutical company will host an open Twitter chat.

Recall that the first ever PHARMA Twitter chat was hosted by Astrazeneca in February, 2011 (see "OMG! AstraZeneca Hosts Twitter Chat & World Does NOT End!"). The subject of that #rxsave chat was how to "raise awareness about helping patients save money through prescription savings programs." The discussion was led by Jennifer McGovern, the director of the AZ&Me prescription savings programs.

Eli Lilly is on a campaign to block any changes in Medicare that implement price controls in the prescription drug payment section (Part D) of Medicare. "A new congressional super committee has been charged with raising the debt ceiling and eliminating more than $1 trillion in spending by the end of the year," noted Lilly's Amy O'Connor -- Associate Consultant, Channel Payer Marketing, Managed Healthcare Services; @ambro93 -- in a blog post (see "If It’s Not Broke… Preserving Medicare Part D"). "One of the current proposals includes instituting a Medicaid-like government price control in Medicare Part D."

What Lilly and other pharmaceutical companies are concerned about is a proposal to add Medicaid-style rebates to the Medicare Part D program that has been introduced in Congress by Representative Henry Waxman (D-CA) and Senator Jay Rockefeller (D-WV). The proposal (S.1206 - Medicare Drug Savings Act of 2011) would require drug manufacturers to provide drug rebates for drugs dispensed to low-income individuals under the Medicare prescription drug benefit program.

Meanwhile, a congressional deficit-reduction panel has a Nov. 23 deadline on what cuts, if any, to make to Medicare, Social Security, Medicaid and other entitlement programs.

Thus, there is an ad hoc coalition of industry and senior citizen groups (ie, PhRMA and AARP) opposed to changes in Medicare: the industry doesn't want to see rebates and seniors don't want to see cuts to benefits or raising premiums.

@lilypad tweeted: "Hope you can join @Modernmeds for a Twitter chat on #Medicare tomorrow [ie, TODAY] at 4:00. Ask questions now via #mmeds"

As of now there are no pre-chat questions on the #mmeds list, so I will ask a few that address ideas for keeping Medicare solvent aside fro instituting rebates. such as:

"What's Lilly's position viz-a-viz republican proposals to privatize Medicare or raise premiums for higher-income seniors?" Another question I have is "To reduce the deficit, should the gov't raise the age of Medicare eligibility to 67 from 65?"

I encourage readers to ask their own questions and join the chat later today.

LillyPad Launches Specious Rocket Attack Against Drug Price Control Straw Man

LillyPad Launches Specious Rocket Attack Against Drug Price Control Straw Man

Eli Lilly, the drug company that increased the price of its antidepressant Cymbalta by 13.6% in 2009, is using its new corporate blog (LillyPad) as a launching site for defending high drug prices (see "Why Price Controls Are Not The Right Answer"). This latest post was in response to a Washington Post article that articulated fears that drug companies would increase drug prices to cover the costs of offering Medicare beneficiaries a 50% drug discount when they find themselves caught within the infamous "doughnut hole" (see "Will Drug Companies Increase Drug Prices to Cover Medicare 'Doughnut Hole' Discounts?").

Lilly's response -- written by Amy O’Connor, Notre Dame alumna, who "manages the intersections between the political environment and Lilly’s business portfolio" -- interests me on several levels.

First, I now understand why Lilly chose the name "LillyPad" for its blog. My Twitter friend Andrew Spong criticized the name as a "an eye-roller, not an eye-catcher" (see here). Spong thought it might have something to do with TypePad, a "third-on-the-podium blogging platform." Whatever the reason, said Spong, "it eludes me."

Well, Andrew, it eludes no more. Lilly's blog is a launching pad destined to promote and sustain the policies of the drug industry -- as if the activities of the drug industry's trade association -- PhRMA -- were inadequate in this regard.

But the main reason I was interested in writing about Lilly's response was because it skirted the main issue raised by the Post article. While the latter was focused specifically on the drug industry's partial coverage of the cost of medicine for Medicare recipients in the doughnut hole, Lilly's post does not mention Medicare at all (except when it references the Post article in the opening paragraph)! In addition, Lilly mis-characterizes the theme of the Post article as highlighting "concerns that biopharmaceutical manufacturers will raise prices on prescription medications." The remainder of Lilly's post is an argument against government price controls in general.

In other words, Lilly has raised a straw man to knock down rather than address the specific issues raised by the Post article.

Lilly also engages in what I would argue are scare tactics, which are definitely aimed at the American consumer (but probably not Medicare recipients). "Did you know that price controls erode incentives to innovate?" asks Amy. "The question is… should we let the fear of the unknown undermine the future of our health care when so much is at stake? Shouldn’t we continue to invest in innovation so we can continue to see real improvements in health care?"

I am not sure what Amy means by "fear of the unknown," except that she uses it to raise the issue of fear itself. It's a nice way to associate fear with government control of prices.

Amy also selectively quotes data such as "From 2006-07, prescription drug prices increased only 1.7 percent." She neglected to mention more up-to-date and relevant data such as "Drug companies sharply raised prices last year [2009], ahead of increased rebates they must pay to Medicaid and other expenses tied to the federal health overhaul passed last month..." (see Drug Prices Rose 9.1% Last Year, Ahead of Federal Health Overhaul). She also did not mention that in 2009 Lilly itself increased the price of antidepressant Cymbalta by 13.6%, according to data from Credit Suisse (op cit).

Finally, Amy cites cancer and AIDS drugs as specific examples of drug company innovations made possible by higher drug prices. Drug companies always the cite bogeyman diseases like cancer to bolster their case. I don't particularly buy the argument because a lot of other factors are responsible for advances made in the treatment of certain cancers -- better screening, for example. As Amy herself says, drugs represent only a small fraction of the costs of healthcare. Ipso facto, drugs also represent a small fraction of healthcare innovation.

Anyway, that's my take on the rocket launched today from Lilly's pad.

P.S. Of course, I submitted a comment to Amy's post. While that awaits moderation, let me reproduce here for the record:

"Amy,

I think you are not addressing the actual issue raised by the Post article, which has to do with specific concerns about how the drug industry MIGHT finance its costs associated with Medicare doughnut hole coverage. You raise a "straw man" by focusing on government price controls in general rather than addressing the specific issue.

"I wrote up my critique on Pharma Marketing Blog (http://bit.ly/agUGuA) and hope you will respond."