Pharmaceutical Industry Spent $44M To Lobby State Officials In 2003, 2004, To Prevent Passage Of Laws That Could Affect Profits, Report Says

Main Category: Pharma Industry / Biotech Industry
Also Included In: Public Health
Article Date: 10 Apr 2006 - 11:00 PDT

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The pharmaceutical industry spent more than $44 million lobbying state governments in 2003 and 2004 and spent $8 million on candidates for state offices, according to a report released Thursday by the Center for Public Integrity, the Washington Post reports (Kaufman, Washington Post, 4/6). The report also found that drug companies gave state political campaigns an additional $18.5 million between 2001 and 2004 (Saitz, Newark Star-Ledger, 4/6). CPI's analysis of lobbying records found that the Pharmaceutical Research and Manufacturers of America was the most active drug lobbyist, spending more than $4.5 million in states. PhRMA and 14 major drug companies together accounted for 80% of lobbying in states on drug issues (Washington Post, 4/6). Among drug companies, Eli Lilly had the highest lobbying expenditures, spending $4.3 million to lobby states in 2003 and 2004 and giving more than $2.2 million to state candidates and political parties from 2001 to 2004. GlaxoSmithKline spent $4.1 million on lobbying, Pfizer spent $4 million and Johnson & Johnson spent $3.1 million (Groppe, Gannett/Indianapolis Star, 4/6). In addition, Pfizer gave more than $3 million to state candidates, while GSK gave more than $2.2 million. The report finds that a majority of the industry's campaign donations -- more than $11 million -- went to Republican groups or candidates. Democratic candidates and affiliated groups received about $7 million (Newark Star-Ledger, 4/6).

State Targets
The center found the majority of drug lobbying occurred in states with the most prescription drug dollars at stake or in which the industry has a significant presence, such as New Jersey and Indiana. California, which has the biggest state prescription drug budget, accounted for 20% of all lobbying expenditures -- the most of any state. According to Gannett/Detroit Free Press, the drug industry has begun to focus more of its lobbying efforts on states because states purchase about 16% of prescription drugs sold in the U.S. through Medicaid and other programs for state residents. That percentage does not include what states pay for drugs for their current and retired employees and for prison inmates. In addition, two-thirds of states have passed laws to cut drug costs since 2003. The laws included changes in buying medicine in bulk, promoting generic drugs over costlier brand names and creating lists of preferred drugs covered by state plans. In comparison, the drug industry spent $44.6 million at the federal level in the first six months of 2005, more than any other industry sector, according to Gannett/Free Press.

Comments
Ken Johnson, senior vice president of PhRMA, said drug companies are educating state officials on the unintended consequences of ill-advised proposals. He said, "State legislatures have considered punitive measures that could have damaged physician-patient relationships and jeopardized the future development of potentially life-saving and life-enhancing medicines" (Groppe, Gannett/Detroit Free Press, 4/6). Eli Lilly spokesperson Angela Sekston said the company's lobbying reflects the intense and sometimes misguided legislative activity in states. She said, "Over the past couple of years, we really felt there was a lot of onerous legislation introduced at the state level that could have done damage to patients and the industry. So we have been actively engaged as allowed by law" (Gannett/Indianapolis Star, 4/6). Roberta Baskin, executive director of CPI, said, "At the same time that the pharmaceutical industry has been splurging millions of dollars to influence state legislatures and drug prices, they're celebrating enormous profits." She added, "The losers, of course, are American consumers who continue to pay some of the highest prices for prescription drugs anywhere in the world" (Gannett/Detroit Free Press, 4/6).

The report is available online.

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