Democrats in Washington, at least some of them, have been attempting to pass legislation
that would help lower the cost of prescription drugs for American citizens, which is actually
something that Donald Trump himself had promised us when he was running for president.
But big pharma won't let their profits dip without putting up a fight.
I'm joined now by Lee Fang from The Intercept to tell us what the industry is doing to prevent
any legislation that could reduce the cost of prescription drugs for American consumers.
Lee, thanks for joining me today.
Hey.
Thanks for having me.
It should come as no surprise that the drug industry is revving up its lobbying muscle
to block any proposal from the Trump administration or from democrats on capital hill to reduce
drug prices in America.
There are a lot of proposals out there, and so the drug industry kind of working collaboratively,
you know, many of the big drug company whether you're talking Johnson and Johnson or Pfizer,
Bristol-Myers Squibb, they are working together pooling their resources into a trade association
known as PhRMA, the Pharmaceutical Research and Manufactures Association and they're kind
of moving very quickly to stomp out all of this kind of activism and legislative proposals
to curb added control of drug prices in America.
Just to give you an example, Senator Al Franken of Minnesota along with a number of other
democrats introduced a big proposal last month to address high drug prices in America and
there are many provisions of the bill.
One of the provisions is to allow Medicare to negotiate using collective bargaining power
just as the veterans administration does to negotiate for lower drug prices.
Another provision in the bill allows the re-importation of FDA-approved drugs from places like Canada.
A lot of provisions that the drug industry does not like and they've hired a number of
lobbyists.
They're funding a number of advocacy groups that are all kind of attacking this Senator
Franken proposal.
It's worth pointing out that right now I believe the VA is the only entity, really, in the
United States that is allowed to negotiate drug prices.
No other government programs can do that.
They attempted, I believe, to get that Medicare drug price negotiation into the original draft
of the Affordable Care Act.
Unfortunately, republicans got a hold of that along with some big pharma lobbyists, manage
to strip that from the final piece of legislation, which that would have been a massive, massive
break for American consumers.
Again, I think we gotta give Martin Shkreli a little bit of credit on this issue, because
had it not been for his greed helping to bring the outstanding cost of drugs in the United
States to the public's attention, we probably wouldn't be having these conversations today.
You had Shkreli with his price gouging then we had the EpiPen and then we had several
other stories.
Those really brought this issue to the public's attention because before that, yes, we were
paying these astronomical prices, but there wasn't necessarily very much coverage of it.
Now that people understand what's happening, we understand we're paying sometimes upwards
of 20,000% markup whereas other countries may pay up to 2,000 to 5,000% markup, still
a huge markup, but a lot less than 20,000.
People are angry.
We've heard that at the town halls and that's why democrats finally decided after the public
outrage to get up and do something about this.
To their credit, most of them are working on this, but, again, as you pointed out on
The Intercept here, we have so much money from big pharma that they spend on lobbying
every single year and now they're doing it basically through these other conservative
groups to fight this legislation with this ad campaign that they've got running.
Tell us about that ad campaign that's going here.
Yeah.
We talk about big pharma spending so much money, hiring so many lobbyist, providing
so much in campaign contributions, but a lot of the money goes on without any public view.
I can give you a number of examples of that.
The latest one, the one I just wrote about is that if you'll open up Politico or the
Washington Post, Washington Times, really any Washington DC area newspaper, any time
over the last two or three weeks after the Al Franken bill dropped, you'll see full page
advertisements from seemingly independent groups.
Organizations like the American Conservative Union, Americans for Tax Reform, a number
of other organization.
These full page ads have pictures of worried seniors saying, ‘Oh, government bureaucrats
are gonna come after your Medicare.
They're gonna ration your choices.
They're gonna do all these dangerous policy experiments that could threaten your medical
care.’
What they're referring to is Senator Franken's bill to reduce drug prices.
What the ads don't tell you is that bureaucrats are already involved in Medicare.
It's a government program.
It's a ridiculous argument.
The bottom line is that these organizations that are warning you about these drug price
reduction proposals are funded by big pharma.
They don't say it in the ads and they don't say it on their website, but we've seen historically
through tax returns that were made public that hundreds of thousands of dollars from
the big drug companies have been pumped into these organizations, and they have a long
history of taking corporate money and then advocating or lobbying on behalf of their
corporate donors.
Some of it just kind of boggles my mind.
Americans for Tax Reform is that famous group founded by Grover Norquist, the anti-tax lobbyist.
Here he is sponsoring an advertisement on Medicare drug prices.
This has nothing to do with taxes.
If anything, if we allowed Medicare to negotiate for lower prices, that would reduce the amounts
that taxpayers have to spend.
So he's arguing, actually, for proposals that waste more tax dollars but he's doing so kind
of covertly to help his drug company sponsor.
So I think that's the issue here.
Just back to your earlier point about Martin Shkreli, because that was a very clarifying,
I think, flashpoint because what Martin Shkreli did was basically, he didn't do any innovation.
He didn't do any research.
He didn't come up with a new idea.
He simply bought the patent and jacked up the price and did so overnight.
So that elicited a lot of big headlines.
The dirty secret of big pharma is that a lot of the big companies do the exact same thing,
they just increase prices incrementally.
They buy a smaller drug firm with medical technology developed in partnership with the
government, NIH is still the biggest funder of medical research in the country.
They buy up the patent and then they increase the drug prices by 10%, 20% on a monthly or
yearly basis.
So the actual behavior is identical to Shkreli, they just don't it in such a hand handed way
to attract public attention.
But if you look at the financial filings of pretty much all of the big pharma companies,
these companies are spending much more on advertising, on lobbying, on merges and acquisitions
than they actually spend on research and development.
All the big pharmas, essentially, pharma companies essentially act as Martin Shkreli does, they
just do so in a much more sophisticated way so they don't attract the same type of negative
headlines.
Exactly.
Shkreli saw that these companies, you know, he saw how rich they were getting, how they
were doing it and he decided he wanted to get a piece of that action, he just didn't
know it takes a little bit of nuance when you want to rip off American consumers.