Drug makers pay millions to sway health debate

Roche and Novartis are waging a fierce battle for influence in Washington Keystone

Swiss pharmaceutical giants Roche and Novartis are spending millions of dollars in an effort to influence United States politicians tackling health care reform.

This content was published on October 28, 2009 minutes

The companies are among the top ten drug manufacturers lobbying the White House and Congress, having spent upwards of $7 million (SFr7.05 million) combined during the first half of 2009 to influence policy.

Roche, Novartis and other groups lobbying Washington spent a total of nearly $400 million lobbying lawmakers on health care reform, President Barack Obama's biggest domestic priority. Congress is currently working on several bills that tackle the issue.

"This year could be a record in the history of lobbying," said David Levinthal, spokesman for the Center for Responsive Politics, a non-partisan research group based in the US capital that tracks money and its effects on elections and politics.

In Congress, Representative Tammy Baldwin, a Wisconsin Democrat and co-chair of the Friends of Switzerland Caucus, acknowledges that pharmaceutical and health insurance companies are a force to contend with.

"Their lobbyists are very active and present in the House and Senate," she said. "They try to get meetings, they seek to persuade, they are more vocal and have a lot more resources than the proponents of a universal system and public health insurance."

Better than insurers

"Our health system is largely based on profit and many people are making good money from it," Baldwin said. "That is why there is great resistance to change."

But if media coverage is focused on insurance company efforts to block a fundamental overhaul, it appears that the drug companies are doing more than insurers in terms of lobbying.

In this game, the two Swiss drug manufacturers are playing a lead role.

Roche was the fifth most active pharmaceutical company in Washington and the first most active foreign drug maker to try to woo the US government during the first half of 2009.

Other companies such as Sanofi-Aventis (France), Merck (Germany), Bayer (Germany) and GlaxoSmithKline (Britain) are also among the top lobbyists. Novartis ranks tenth.

Efforts to pay

Roche declined to comment, but the global head of pharmaceuticals at Novartis, Joe Jimenez, stressed that Novartis "supports the initiatives of the Obama administration to expand coverage and improve quality of care for all Americans".

Jimenez said the pharmaceutical industry had made a "significant commitment" to reduce costs of the US system, the world's most expensive, especially since drug prices are 40-60 per cent higher than in other developed countries.

"We reached an agreement with the White House and the Senate that we will return $80 billion over ten years in the form of discounts to patients covered by Medicaid and Medicare, public programmes for the poor and those over 65," he said.

The effort seems somewhat relative, however, since the US accounts for half of the global pharmaceutical market, with annual sales close to $300 billion.

The drug companies' lobbying efforts appear to be paying off in other ways, too. No bill being debated in Congress provides for a cap on drug prices. None proposes to reduce how long a company can hold a patent, which keeps generic manufacturers from making the same drug for less.

Defending Novartis

Consumer advocates blame pharmaceutical companies for trying to preserve the status quo. Roche spent more than $4 million on lobbying efforts during the first half of 2009. Novartis spent more than $3 million during the same period.

"These companies are concerned about their turnover and wish to keep prices as high as they want," Levinthal said. "So far in the health care reform debate, they have got what they wanted."

Novartis, for its part, contends that prices in the US reflect production costs and allow for further research.

"We invest 20 per cent of our turnover in research, and when people accuse us of only being concerned with revenue, we say that we are protecting our investment and we ensure that innovation is rewarded," Jimenez said. "Otherwise, the number of medicines being developed will be reduced and science won't advance."

Marie-Christine Bonzom in Washington, (Translated from French by Tim Neville)

Health Care Reform

Health care reform is a priority for President Barack Obama, who is seeking to extend health insurance coverage to all Americans while reducing skyrocketing health costs.

Some versions of bills circulating in Congress also call for the creation of a public health insurance option to foster competition and drive down premiums.

Reform faces fierce opposition from the majority of Republicans, private insurers, unions and large employer organisations.

The Senate Finance Committee, one of the most powerful bodies in Congress, voted last week to send its version of health care reform on to the Senate for debate.

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The most powerful

Of the 121 industrial sectors that lobby Congress and the White House, pharmaceuticals are at the top of the list of the most active.

Drug makers alone spent nearly $134 million, more than any other sector, in attempts to influence the American government during the first half of 2009.

Pharmaceutical companies spent more on lobbying against health care reform than health insurance companies, which spent $82 million during the same period.

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