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UPDATED: Big drugmakers' secret D.C. meeting
By: David Freddoso
Commentary Staff Writer
07/23/09 11:08 AM EDT
Top pharmaceutical executives are meeting in secret -- or as their spokesman tells The Examiner, "in private" -- today in the basement of the historic Willard Hotel in downtown Washington, D.C.
Whatever they are discussing, the public is not invited.
The Examiner had received a tip that PhRMA, the trade group representing drug companies, was quietly holding a conference today of top executives from its 29 member-companies to discuss President Obama's health care proposals. After The Examiner first reported the meeting today, PhRMA spokesman Ken Johnson said that the meeting was "private, not secret," and that it was actually just the regular monthly meeting of PhRMA's board. Because of the large number of executives who RSVPed, Johnson said, the location was changed from PhRMA's offices to the Willard.
"There is nothing nefarious going on here," said Johnson.
When contacted early this morning, a concierge at the Willard denied that any such event was happening today. There were no signs for the event in the hotel's lobby, either, but PhRMA signs adorned the meeting's registration table in the hotel's basement conference room. PhRMA officials turned The Examiner away from the meeting, stating that it was not open to the public.
PhRMA has taken a generally supportive attitude toward insurance reform, although the group leveled some specific criticisms recently against the health care bill produced by House Democrats.
The drugmakers' quest for influence in the shaping of health policy has led to an industry-wide lobbying campaign perhaps unprecedented in its scale. In just the first half of this year, PhRMA and its member companies have spent about $78 million lobbying Congress.
Johnson said that the lobbying expenditures have to be understood in their proper context. "When you consider the consequences for patients, we have to do whatever is necessary to reform our health care system, to make it patient-friendly, to lessen the impact it has on our economy every year," he said. "We're prepared to do whatever we can to make health care reform a reality this year."
He added that the industry's deal with President Obama, to reduce Medicare Part D costs to the government by $80 billion over ten years, was part of a strategy to guarantee stability for its members. "One of the reasons we made that agreement was to literally buy some certainty over the next ten years," he said, "to make the right research and development decisions for our companies"
In a March interview on CNBC, PhRMA president and CEO Billy Tauzin said that the bill would be good for pharmaceutical companies because it would broaden the industry's customer base with subsidies for insurance.
"This plan talks about providing comprehensive health insurance to people who don't have it," said Tauzin, when asked whether investors should worry about Obama's health care plan. "That means to patients who can't take our medicines because they can't afford it -- $650 billion spent to better insure Americans for the products we make. That ought to be a very optimistic and positive message for everyone who is interested in our sector of the economy."
Johnson said that Tauzin may have overstated the case. "It's a mistake to say that our companies are not going to feel some pain," said Johnson. "When you factor in people who will suddenly become insured, versus what we're giving up, it's more of a wash than it is a gain."
The Senate health bill, whose details are being worked out in the Senate Finance Committee by Chairman Max Baucus, D, Mont., is considered much more favorable to the drugmakers than the House version. The Washington Post reported earlier this month that two former Baucus chiefs of staff have been hired to lobby for PhRMA.
In addition to the insurance subsidies, some members of PhRMA stand to benefit from another provision in the Senate version of health care reform. It creates a 12-year government-enforced exclusivity period for biologic pharmaceuticals, which is longer than most drugs' effective period of exclusivity.
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