[Ip-health] Congress v. Big Pharma

[Ira Glazer]

http://www.tompaine.com/print/congress_v_big_pharma.php

James Ridgeway
December 15, 2006

James Ridgeway is the Washington correspondent for Mother Jones .
Additional research by Caroline Dobuzinskis.

With its stranglehold on the nation's health care bills and its
record-high profits, including billions from public coffers, no industry
may be an easier target for reform than Big Pharma. But don't hold your
breath for any meaningful reforms from the next Congress, given that
even the most obvious ideas=97such as expanding the Medicare drug benefit
and opening the door to drug imports from Canada and elsewhere=97will face
unrelenting pushback from the massive drug lobby. In the end,
Congressional Democrats may not accomplish much to help patients, but
they will likely launch the first serious investigations of the industry
in decades. (The only pharma oversight effort in the past six years, led
by Charles Grassley, R-Iowa, in 2004, focused on poor FDA oversight of
drugs such as Vioxx).

In January powerful Michigan Democrat John Dingell will take the reins
of the House Energy and Commerce Committee. Sources with knowledge of
the committee's plans say that by February, Dingell aims to launch
several probes of the drug industry, including a look at fraud in
Medicare and Medicaid with particular focus on the black-market sales of
expensive cancer drugs and other pharmaceuticals. Dingell also wants to
investigate the process by which drugs get approved at the FDA, and
explore the question of imports from Canada, where U.S. drug makers sell
many pharmaceuticals cheaper than they do here.

Other committees believed to be gearing up for investigations are the
House Government Reform Committee (incoming chair Henry Waxman,
D-Calif., declined to comment on his plans), and Senator Ted Kennedy's
Health, Education, Labor and Pensions Committee, which now includes two
freshmen who have made health care reform a major part of their
campaigns=97Sherrod Brown of Ohio, and Bernie Sanders, the Vermont
independent.

The industry, in response, is beefing up its defenses, hiring new
Democratic lobbyists, including several who were staffers from Kennedy
and for House Speaker-elect Nancy Pelosi. And, reports the Washington
Post, the industry is setting its sights on the elevation of Congressman
Edolphus Towns, D-N.Y.,=97best known as a major defender of the tobacco
industry=97to the chairmanship of the important health subcommittee of the
House Energy and Commerce Committee, where he could help stall reform.

In whatever configuration, the issues the new Congress will have to
confront right away include the new Medicare Plan D drug benefit
program. The benefit is administered through various private plans run
by HMOs, the AARP, and others, each of which negotiates its own prices
with drug makers. Critics argue that as constituted, this program=97the
only part of Medicare that doesn't include price controls=97is a virtual
handout to the drug companies, and that the government could push for
much lower drug prices if it were to negotiate with manufacturers
directly. A number of Congressional freshmen supported this idea on the
campaign trail.

Another likely agenda item is Plan D's so-called doughnut hole. A senior
can register for the plan and receive coverage for up to $2,400 worth of
drugs. After that a senior continues to pay premiums but gets no
coverage until he or she spends about $3,800. Then the insurance picks
up again.

Plan D is a miasma=97the Bush people like to refer to it as a
marketplace=97of different private plans, some plugging the doughnut, some
closing it part way. According to staffers at the Center for Medicare
Advocacy in Washington, there is as of yet no real plan in Congress for
plugging the doughnut or changing the overall plan. Edwin Park, who
follows Medicare for the Center for Budget and Policy Priorities, a
Washington think tank, says he doubts there will be any quick fixes for
the doughnut hole, in part because of the cost of closing the gap=97an
estimated $400 million over 10 years. Bush is dead set against removing
the marketplace feature and the Democrats, with their narrow margins,
would have a hard time overriding a veto. Thus, some health advocates
think that while Congress won't allow the government to negotiate prices
wholesale, they might let the government enter the Plan D market as
another buyer alongside the existing private plans.

A second confrontation may come over the import of cheaper drugs from
Canada. Democratic Senator Byron Dorgan of South Dakota has taken the
lead on this issue; last July, Senate Democrats voted to permit Canadian
imports. Bush has promised to veto such legislation, should it ever
pass; meanwhile, the Canadian drug industry is preparing to press Ottawa
to ban cheap exports to the United States, a move that would leave
patients turning to Latin America and elsewhere.

"My main hope is exposure,'' says Dr. Sidney Wolfe, who heads Public
Citizen's Health Research Group. Even if reform legislation were to pass
in this Congress, he notes, "it would be almost guaranteed to face a
presidential veto." More likely, he says, investigations today will pave
the way for reform later.

Reprinted from Mother Jones.