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The Chill Pill: Would a Dem White House Take on Big Pharma?

On the trail, candidates fulminate about the drug companies, but money may still speak louder than words.

| Thu Dec. 20, 2007 3:00 AM EST

Clinton's strongest statements regarding the drug industry have come during the debates. In June at New Hampshire's Saint Anselm College, she said, "We have to lower costs, improve quality, and cover everybody." Referring to her failed 1993-94 attempt at health care reform, she added, "You've got to have the political will—a broad coalition of business and labor, doctors, nurses, hospitals, everybody—standing firm when the inevitable attacks come from the insurance companies and the pharmaceutical companies that don't want to change the system because they make so much money out of it."

It looks like Big Pharma may be counting on the fact that Hillary has learned her lesson. As of October 2007, according to the Center for Responsive Politics, she led the field among both Democrats and Republicans for campaign contributions from the pharmaceutical industry, with $274,436. Among her supporters is Jeff Kindler, CEO of Pfizer, who donated $2,300. Kindler is unusual among Big Pharma executives in that 67 percent of his political contributions have gone to Democrats and only 4 percent to Republicans (the rest were to PACs). But the mere fact that the head of America's leading drug manufacturer—U.S. sales in 2006 totaled a cool $26.7 billion—supports the party tells us that there's something wrong with it.

BARACK OBAMA has engaged in some strong rhetoric denouncing lobbyists and corporate interests in general, and the drug and health-insurance industries in particular. At the New Hampshire debate in June, he said: "My emphasis is on driving down the costs, taking on the insurance companies, making sure that they are limited in the ability to extract profits and deny coverage...The drug companies have to do what's right by their patients instead of simply hoarding their profits." And during the September Univision debate he went a step further, saying of the insurance and drug lobbyists, "As president, I am going to take them on."

That sounds well and good until you follow the money. Obama ranks just behind Clinton as a recipient of Big Pharma campaign contributions, second among both Democrats and Republicans with $266,384. His backing from corporate interests is generally comparable to Clinton's. And so is his health plan.

As part of his written plan for "Modernizing the U.S. Health Care System to Lower Costs and Improve Quality," Obama promises to "prevent [insurance] companies from abusing their monopoly power through unjustified price increases." The site goes on to point out the disparity in drug prices between the United States and markets in Europe and Canada. The solution? "Obama will allow Americans to buy cheaper medicines from other developed countries if the drugs are safe...repeal the ban that prevents the government from negotiating with drug companies for the Medicare prescription drug benefit, [and] work to increase the use of generic drugs in federal benefits programs and prohibit drug companies from keeping generics out of markets."

These are steps in the right direction, but small ones that all of his rivals, along with virtually every Democrat in the country, support. The only difference between the Clinton and Obama plans is that Obama doesn't mandate health-insurance coverage for everyone—and his program of subsidies to help poor people get insurance is weaker as well.

JOHN EDWARDS has sought to position himself as the populist candidate who will stand up to corporate interests, including the insurance and drug companies. He came out swinging on this issue in his speech at last February's meeting of the Democratic National Committee: "We have to stop letting the health insurance companies and the big pharmaceutical concerns decide our nation's health care policy. We have to give the silent victims&8212;who stand in line at free clinics and use the expired medicines of friends and neighbors—the dignity of universal health care."

He's maintained this line in subsequent speeches and debates. During the Huffington Post online debate in September, he declared: "Without taking drug companies, insurance companies, and their lobbyists on head on, we will never have universal health care...Some [candidates] argue that you should give them a seat at the table, you should negotiate with them, compromise with them. I fundamentally disagree with that...The reason we don't have universal health care is these people have absolutely no intention of giving away their power voluntarily. We have to take their power away from them."

Yet Edwards' written health care plan, the first to emerge from the candidates, barely mentions the pharmaceutical industry, and when it does, the emphasis is on safety rather than cost or profits. The plan, called "Universal Health Care Through Shared Responsibility," includes a promise to protect patients against dangerous medicines: "Recent drug recalls such as Vioxx have raised concerns about drug safety. Edwards will restrict direct-to-consumer advertising for new drugs to ensure that consumers are not misled about the potential dangers of newly marketed drugs and strengthen the Food and Drug Administration's ability to monitor new drugs after they reach the marketplace. He will also ensure that researchers evaluating medical devices and drugs are truly independent."

The significant difference between Edwards and the other Democratic candidates is his emphasis on a public option for health-insurance coverage. This strategy has its own shortcomings: As Dennis Kucinich pointed out in one debate, if you have both public and private insurance plans, "what happens is that the private companies start cherry picking the people in the best health, and then you end up with what's called adverse selection... The most medically compromised end up on programs that the government is paying for, and then the government program starts to go down" while insurance industry profits go up. However, Edwards presents the public option as an experiment of sorts, a trial run for government-run, single-payer health care. This, of course, is the ultimate evil in the eyes of Big Pharma, because it would give the government the negotiating power it needs to force down drug prices. While his rivals treat single-payer as the policy that they dare not speak its name, Edwards said this in the Huffington debate: "There is a very good and legitimate argument that we should go straight to single-payer health care as other countries have...There are huge advantages to single-payer...much lower administrative costs... I thought it was something that we should let Americans decide. Get everybody covered, get rid of the holes in the system."

Another factor that separates Edwards from the other candidates is the level of campaign contributions he has received from Big Pharma. While Clinton's and Obama's numbers are well over $200,000, Edwards' total is just $15,000. He's not even in the top 10, lagging behind Ron Paul and Tommy Thompson, who quit the race more than a year ago. As a trial lawyer, Edwards won huge settlements from health care corporations. You can imagine how the drug companies feel about that, especially at a time when they're seeing a dent in their profits, after they contributed to the deaths of thousands of people with Vioxx.

Every one of the Democrats' health care plans is vastly superior to anything offered by Republican candidates. John McCain, the least noxious of the bunch, is your average private-enterprise Republican; from that position, he voted against the Medicare drug bill and for drug importation from Canada. Mitt Romney spends most of his time explaining why his own Massachusetts health care plan is nothing like what the leading Democrats are offering (though it kind of is). Mike Huckabee, when not explaining that he didn't really say in 1992 that AIDS patients should be quarantined, talks a lot about how he lost 120 pounds (and how we could roll back the health care crisis if everyone would just stop eating corn dogs). Ron Paul wants to eliminate medical-malpractice suits by having patients buy special "negative outcomes" insurance before going in for surgery. Rudy Giuliani, whose wife once was a pharmaceutical sales rep, talks of privatizing Medicare and Medicaid and wants individuals, rather than employers, to purchase health insurance.

A Republican in the White House would be very good for pharmaceutical companies and a Democrat might make them squirm just a little bit. Still, Dennis Kucinich is right when he says "the presidential debate on health care has been largely fake, with phony claims from candidates that they are providing 'universal health care' when, in fact, they are preserving the for-profit system of private insurance companies who make money not providing health care." When it comes to Big Pharma, he's also right that the only way to limit profits is through the kind of comprehensive price controls practiced by the rest of the industrialized world. "America is a captive market" to the drug industry, he said back in 2002. "Our government should place limits on the price which any manufacturer can charge for prescription drugs. We need a new...regulatory structure which puts a ceiling on drug-company profits the same way credit laws establish what constitutes usury... As with utility rates, our government should be empowered to lower prices and impose windfall-profits taxes to correct excess pricing."

We, of course, won't see anything like this anytime soon—not until money stops buying votes and policy decisions in Washington. The final word on the matter comes from another plain-speaking Democratic candidate who is not considered a "viable" choice, Mike Gravel. In a September interview with Slate, he said, "When the industry that profits from health care calls the shots on the way health care is going to be delivered, then you are going to see the anomalous situation that you have in this country where they can't even deliver it to everybody fairly." Asked how he'd go about curbing that sort of influence, Gravel responded, "Well, you can't. This is representative government. They put up all the money."

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