To determine whether Big Pharma’s $80 billion contribution to the Big O’s health reform movement represents a magnanimous gesture or a negotiation ploy designed to save $20 billion, it’s worth taking a moment to review pertinent history.
Sixteen years ago, the pharmaceutical industry teamed up with Big Insurance and providers to sink HillaryCare.
This time ‘round, it has chosen to defend its interests by sitting at the table, in part because that’s what everyone else did.
Its interests are to maintain drug prices and profit, which means insurers and providers would be left to take the cost-reduction hit.
Big Pharma loves the idea of universal health coverage, since enabling the uninsured to gain access to its products will increase sales by some $18 billion per year.
It’s also a fan of payment schemes that foster disease prevention, since they pump up sales of its cardiac and diabetes drugs.
Big Pharma has spent lavishly to push this agenda. Company disclosure reports reveal it poured $47.4 million into lobbying efforts in Q1, 2009 alone, up 36% from last year.
AZ Chief Executive David Brennan told the Wall Street Journal that since prescription drugs account for “just about 10% of the overall cost” of US spending health care, the cost cutters ought to look elsewhere.
Pfizer Chief Executive Jeffrey Kindler’s against a Medicare-like public insurance plan that would enact “price controls” on drugs, robbing the industry of just rewards for the risk associated with drug development.
Meanwhile, the industry has bumped prices on many drugs more than 15% in the last quarter, according to data from Credit Suisse, in all likelihood to squeeze out every penny from its pills before its patents perish and policymakers pare prices.
Still, Big O spokesperson Linda Douglass praised the industry for playing in the band. Big Pharma is “agreeing we can no longer live with the status quo. It wasn’t that way 15 years ago,” she reasoned.