SPENDING BY U.S. DRUG MANUFACTURERS REAPS REWARDS

By Diane M. Grassi

Drug manufacturers have noticeably been in the headlines these past several months. Most covered was the recall of the arthritis pain medication, Vioxx, and the scrutiny given other COX-2 inhibitor anti-inflammatory medications and the previous non-disclosure of side effects potentially causing heart attacks and strokes in patients primarily with heart disease. Although Vioxx hogged the headlines, the underlying story of how Vioxx in particular became one of the best-selling prescription medications in recent memory, along with many others still on the market, has largely been non-disclosed to the public.

The pharmaceutical industry has a two-pronged approach in generating both revenue as well as influence over key federal legislation and currying favor with the Federal Drug Administration. The $4 billion which the pharmaceutical industry spent on commercial advertising in 2004 alone is just part of the story. In the past seven years pharmaceuticals have spent over $800 million in federal lobbying efforts, campaign donations and state lobbying and presently sit atop all other industries in lobbying efforts on Capitol Hill. Both money for advertising and lobbying go hand in hand.

In addition, of the 1,274 people registered to lobby in Washington, D.C. in 2004 on behalf of the pharmaceutical industry, according to the non-partisan Center for Public Integrity, 476 are former federal officials who worked for regulatory agencies as well as in Congress. They include over 15 former members of the U.S. Senate and over 60 members of the U.S. House of Representatives. The most powerful pharmaceutical industry lobbying group in Washington is the pharmaceutical trade group Pharmaceutical Research Manufacturers of America (PhRMA). It is now headed by former Rep. Billy Tauzin (R-LA) and was central to getting the 2003 Medicare Modernization Act passed while Tauzin was Chairman of the House Energy & Commerce Committee. Drug manufacturers successfully joined with the Bush administration in preventing cost restrictions on drugs with the passage of the new Medicare law which features prescription benefits, shortly going into effect in 2006. In addition, drug companies are awarded with corporate tax breaks by the federal government.

Senator Bill Frist, a heart surgeon prior to serving in the Senate and now Senate majority leader, has just recently called upon the Government Accountability Office (GAO), a non-partisan investigative branch of the Congress, to examine drug advertising practices. He said, “This advertising can lead to inappropriate prescribing and fuel prescription drug spending.” On the other hand Sen. Frist has personally enjoyed favors from pharmaceutical giant, Schering-Plough, supplying him with a private Gulfstream corporate jet several times at the cost of a first-class commercial fare. Pharmaceuticals regularly supply members of Congress access to private jets at a minimal cost, which often includes a lobbyist along for the ride to capture a lawmaker’s ear on key legislation they either want passed or want to prevent.

Along with the lobbying efforts of pharmaceutical companies themselves are non-profit organizations which directly profit from a money stream from the drug makers. To wit, during the Senate hearings in March 2005 on the FDA’s drug approval process in light of the belated discoveries of the health risks from taking Vioxx, witness Nancy Davenport-Ennis testified on behalf of the National Patient Advocate Foundation which receives funding from pharmaceutical firms, Pfizer, Merck - manufacturer of Vioxx-, and Glaxo-SmithKline. She admitted that “I don’t think there is a patient advocacy group in America that does not receive some level of funding from a pharmaceutical company.” This includes the AARP, instrumental in passage of Medicare’s new prescription drug plan, which remains flawed and confusing to date, even to the Social Security Administration, as it scrambles to outline its rules and benefits for 2006.

Physicians have long been concerned about the direct-to-consumer advertising and want the discretion to prescribe medication put back into the examining room. At a recent American Medical Association meeting several resolutions were proposed to restrict such advertising. Interestingly Washington lobbyists on behalf of several pharmaceuticals attended the meeting in an effort to block such reforms and such issues were then tabled by the AMA for another year.

The practice of advertising drugs to consumers has become deceptive for many patients, who do not get balanced scientific information. The ads are created to make drugs appealing rather than to clearly disclose the benefits and risks in order for proper evaluation. Doctors then wind up wasting valuable time trying to explain to patients why that drug is either inappropriate or would end up costing the patient much more while the present regimen they are on is just as good. Senator Herb Kohl (D-WI), ranking member of the Senate Special Committee on Aging, recently said, “Spending for prescription drugs is one of the fastest growing components of national health care spending in the U.S., increasing fourfold between 1990 and 2002. At the same time, pharmaceutical manufacturers are spending billions of dollars to advertise prescription drugs directly to consumers.” Kohl has joined Sen. Frist in requesting the GAO research on the impact of direct-to-consumer advertising to consumers and how much television and print ads have led to escalation of drug costs.

As such, Senator Frist has asked drug companies to voluntarily police their advertising policies prior to the FDA and the Congress getting officially involved. Presently the FDA only requires that companies only mention the most prevalent potential side effects and provide a toll-free number. But Frist has just asked for a restriction on advertising during the first two year’s of a product’s release on the market. This has not gone over well thus far with pharmaceuticals. First Amendment attorney Floyd Abrams has gone so far as to say that “they fall within the realm of protected speech if they’re not illegal and not misleading.” And the FDA’s only regulatory mechanism is a warning letter and no penalties as long as the objection is corrected.

In 2006 direct-to-consumer advertising is expected to rise 10% and lobbyists show no signs of letting up. While this multi-faceted scenario along with myriad federal laws and regulations is at best confusing, the consumer or patient must not assume that every ill can or should be handled by taking medications, whether prescription or over-the-counter. And it is important to patients to ask questions of their doctors about preventative care first before relying on medications which always are accompanied by side effects of some kind.

And more importantly, the less costly prescriptions are dispensed, the less the costs will continue to rise. Yet the retail costs of medications which many elderly and disabled must pay for out-of-pocket due to no prescription coverage, can easily add up to thousands of dollars each year, and they usually do not have the luxury of doing without their medications. Until medications are affordable for all, especially for those most in need of them, it will be up to the federal government to take on the pharmaceutical industry in containing costs. Sadly, at this juncture it does not appear that will happen anytime soon.