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Pharmaceutical Research and Manufacturers of America

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Pharmaceutical Research and Manufacturers of America, also known as PhRMA, is one of the largest and most influential lobbying organizations in Washington.[1] Representing 48 pharmaceutical companies, PhRMA has 20 registered lobbyists on staff[2] and has contracted with dozens of lobby and PR firms -- including Akin, Gump, Strauss, Hauer & Feld,[3] Barbour Griffith & Rogers,[4] DCI Group[5] and The Dutko Group[6]-- to promote its members' interests. PhRMA has a record of hiding its lobbying and PR activities, often by paying other organizations, such as United Seniors Association (USA) or the Consumer Alliance, to advocate industry-friendly policies.[7]

PhRMA's Chairman, Sanofi-aventis CEO Chris Viehbacher, made approximately $4.5 million (€3,469,973 Euros) in 2010 .[8]

Contents

Support for American Legislative Exchange Council

PhRMA is a member of the American Legislative Exchange Council (ALEC) as of 2011. Jeff Bond, Senior Vice President of PhRMA, represents PhRMA on the corporate "Private Enterprise" Board. [9]

Kristin Parde, a PhRMA Director, represented PhRMA on ALEC's Health and Human Services Task Force until Spring 2011. [10] Prior to joining PhRMA, Ms. Parde was Civil Justice Task Force Director for the American Legislative Exchange Council (ALEC). [11]

Julie Corcoran, deputy Vice President of Government Affairs at PhRMA, was the co-chair of the Health and Human Services Task Force. [12][13]

About ALEC
ALEC is a corporate bill mill. It is not just a lobby or a front group; it is much more powerful than that. Through ALEC, corporations hand state legislators their wishlists to benefit their bottom line. Corporations fund almost all of ALEC's operations. They pay for a seat on ALEC task forces where corporate lobbyists and special interest reps vote with elected officials to approve “model” bills. Learn more at the Center for Media and Democracy's ALECexposed.org, and check out breaking news on our ExposedbyCMD.org site.

Jeff Buel is director of state government affairs for Johnson & Johnson (also an ALEC member), and is the PhRMA chair in New Mexico and PhRMA vice chair in Arizona; Buel also served on the Health & Human Services Task Force on behalf of Johnson & Johnson. </ref>

Political Contributions and Lobbying

In 2010, PhRMA spent $21,740,000 on lobbying, as reported by Open Secrets. [14] PhRMA's list of lobbyists can be found HERE. The 2009 - 2010 bills PhRMA lobbied on can be found HERE.

Open Secrets reports that in 2010, PhRMA gave a total of $58,800 to House candidates ($40,800 to Democrats, $18,000 to Republicans) and $65,000 to Senate candidates ($50,500 to Democrats, $14,500 to Republicans). [15] In 2010, PhRMA's PAC gave almost exactly equal amounts to Democrats and Republicans.[16] 2008 direct contributions primarily benefitted Democrats, but PAC spending slightly favored Republicans. [17] [18] This was a shift from contribution patterns in 2006 and before, where PhRMA spending primarily benefitted Republicans. [19]

2009 Health Care Reform

According to the AARP, PhRMA "raised and spent at least $101.2 million in 2009 on advocacy efforts during the contentious health care debate. Former PhRMA CEO Billy Tauzin says the lobby used the money - special contributions from member companies - for broadcast and print advertising, grassroots and direct lobbying, polling and consulting . . . Tauzin left PhRMA in mid-2010 amid rumors his support of the health overhaul led to his demise at PhRMA." [20]

"While supporting the Democratic overhaul with the $100 million-plus payload, PhRMA also donated to organizations that hosted the health law’s most vocal critics, including the conservative-leaning Heritage Foundation; the National Review, a magazine founded by William F. Buckley Jr.; the Pacific Research Institute, a right-leaning think tank, and the Hudson Institute. For much of 2009, the Hudson Institute employed former New York Lieutenant Governor Betsy McCaughey, a firebrand who is credited with supplying the fodder for Sarah Palin's "death panel" myth." [20]

"Stealth PACs"

A Sept. 2004 report published by Public Citizen stated "PhRMA Appears to Have Funneled Up to $41 Million To "Stealth PACs" to Help Elect a Drug Industry-Friendly Congress. . . Public Citizen believes that four seniors’ groups may have been heavily financed by the Pharmaceutical Research and Manufacturers of America (PhRMA) and may have engaged in enough activities intended to influence elections in 2002 to raise the question of whether they violated the prohibition against allowing political work to be their primary activity." [21]

Leadership

2010 and 2011

  • Chris Viehbacher - Chairman of the PhRMA Board: CEO of Sanofi-aventis
  • John J. Castellani - President and Chief Executive Officer: Pharmaceutical Research and Manufacturers of America
  • Billy, Tauzin - President and Chief Executive Officer of PhRMA until February 2010[22]
  • Mimi Simoneaux - Vice President
  • Thomas Moore - Director
  • Christopher Singer - Executive Vice President and COO
  • Bryant Hall - Senior Director
  • Steven Tiltion - Vice President
  • John Castellani - President
  • Kevin Walker - Vice President
  • Chip Davis - Executive Vice President of Advocacy

PhRMA's President and CEO until he stepped down in February 2010, former Louisiana congressman Billy Tauzin,[23] received $4.6 million in compensation from PhRMA in 2009.[24]

PhRMA PR campaigns

2006: Qorvis and new medicines

In September 2006, the PR industry trade press reported that PhRMA had retained Qorvis Communications, "for a national PR campaign to educate the public about the good work done by drug companies and the important role they play in developing new medicines." [1]

"The PhRMA strategy emphasizes public and media education about the organization’s core mission and values and its advocacy for public policies that encourage the discovery of important new medicines," according to the Holmes Report. "Qorvis will employ a campaign-style approach that is intended to complement PhRMA’s new communications department, which has replaced a once-rigid structure of silos around individual issues with a flat, team-based model the group says has encouraged increased flexibility and creativity." [2]

"Since being named CEO at PhRMA more than a year ago, former Louisiana Representative Billy Tauzin and his communications team, led by Ken Johnson, have been implementing an aggressive public relations campaign in an attempt to address the industry's numerous reputation challenges, from pricing to safety to whether drugs are marketed over-aggressively," wrote the Holmes Report. [3]

2005: Aggressive PR

In May 2005, it was reported that PhRMA was launching "an aggressive new PR plan," highlighting its new CEO, former Congressman and cancer survivor Billy Tauzin. According to PhRMA senior vice-president of communications Ken Johnson (who should not be confused with the Ken Johnson who is the Southern Regional Director of the AFL-CIO), the new plan includes reorganizing media relations "almost like a beat system," with point people for "state, federal, or international outreach."

PhRMA also launched a radio series called Healthcare Now, "which Johnson likens to an ANR (audio news release) that can be played in small markets without health reporters." PhRMA is also "building an onsite studio" to allow Tauzin to do more television interviews and speaking events. Johnson said part of PhRMA's PR strategy is to make Tauzin "an evangelist for the pharmaceutical industry." [4]

2005: Pricing issues and marketing

In late March 2005, the Los Angeles Times reported that the pharmaceutical industry was facing "pressure from many states to provide cheaper prescription drugs." Washington state and Rhode Island legislators were considering how to control medical costs, and "Ohio and Maine recently have launched their own discount plans for low-income people." Yet PhRMA, along with individual drug companies, "launched its most aggressive counterattack in California," to defeat a proposed ballot initiative "even before the authors have gathered enough signatures to qualify it for the next election." PhRMA vice-president Jan Faiks said, "We take [the proposed initiative] as such a serious threat to the health and welfare of the pharmaceutical industry that we have to make a stand here," in California. "It's a very bad precedent. You're the leader in the country, and there are 26 states that allow ballot initiatives." [5]

Part of industry's concern at the proposed California initiative, authored by the Oakland nonprofit organization Health Access California, was due to its "punishing individual manufacturers that decline to lower prices voluntarily" - a level of enforcement the industry had been able to avoid in other states. Under the proposed California initiative, "drug companies that do not consent to the discounts could be shut out of a prized market: the state's huge Medi-Cal program, which annually buys $3 billion worth of drugs for the poor." [6]

PhRMA, along with the drug companies Johnson & Johnson, Pfizer, GlaxoSmithKline, Abbott Laboratories, Amgen, AstraZeneca, Eli Lilly, Novartis and Wyeth, "pledged to donate at least $10 million in California to fight proposed ballot initiatives that would mandate lower drug prices." ($8.6 million had been raised by late March 2005.) The industry hired "Sacramento's best-connected Democratic strategists ... to cut a deal with the Democrat-controlled Legislature and avert a ballot battle." Those lobbyists were former Assembly Speaker Willie Brown, former Gray Davis speechwriter Jason Kinney, former Davis campaign advisor and labor commissioner Steve Smith, and Schwarzenegger recall campaign strategist Bob White. PhRMA also negotiated with Governor Arnold Schwarzenegger, to develop an alternative "voluntary discount plan called California Rx." [7]

Perhaps most disturbingly, PhRMA threatened "retaliatory initiatives aimed at trial lawyers and unions, which are most likely to be donors to Health Access' ballot measure." The industry's "two companion ballot measures" were unmistakably "aimed at the heart of Democrats' donor base." One measure "would slash trial lawyers' contingency fees," while the other "would require public employee unions to obtain members' permission before spending their dues on political activities." PhRMA's Frank Schubert, who is managing the initiative campaigns, said, "It certainly is a signal to the unions that they're not going to engage in a one-handed attack, that the industry is going to fight for its interests and the interest of the patients that it serves." [8]

2004: Depression calculator

In June 2004, PhRMA teamed up with the U.S. Chamber of Commerce and the American Psychiatric Association "to demonstrate the cost of depression in the workplace and to show employers that treating affected workers would improve the bottom line." The three groups endorsed a "depression calculator," which allows employers to estimate the effect of untreated depression on their company's profits, through absenteeism and low productivity. The calculator also figures "how much the business would save if employees were treated."[9] The Arizona-based "health-care consulting firm" The HSM Group organized the calculator's public "introduction." At the press conference unveiling the calculator, PhRMA's senior vice president for policy, research and strategic planning, Richard Smith, said: "A depressed employee is less productive or absent for 30 to 50 days a year. ... The person's medical costs are $2,000 to $3,000 more than other employees."[10]

Self-regulation of drug ads

In May 2005, former member of Congress Billy Tauzin, then PhRMA's head lobbyist, told the New York Times that "drug companies [are] trying to develop a voluntary code of conduct for the advertising of prescription medicines on television and in print." Tauzin said "a good strong code" would likely be issued in June or July 2005. However, "one purpose" for the code "is to fend off more stringent federal regulation," wrote the New York Times. [11] "Better to self-regulate than to have someone else tell you how to conduct your business," one pharmaceutical marketing chief told Advertising Age.

PhRMA's guidelines for direct-to-consumer (DTC) drug ads were being developed as mounting evidence suggests "drug sales don't necessarily rise or fall as TV ads are boosted or reduced," because, unlike other products, "a consumer can't buy a prescription drug without a doctor's signature," reported the Wall Street Journal. In addition, "the safety controversy over highly advertised painkillers Vioxx from Merck & Co. and Celebrex from Pfizer" increased scrutiny of drug ads. [12]

PhRMA's Board of Directors approved the "PhRMA Guiding Principles: Direct to Consumer Advertisements About Prescription Medicines" (PDF file) on July 29, 2005. The policy was officially announced by Tauzin on August 2, 2005, at the American Legislative Exchange Council's 32nd Annual Meeting. PhRMA touted the guidelines, slated to go into effect in January 2006, as a way to educate patients. Along with the guidelines, PhRMA created an "Office of Accountability," to receive "comments from the general public and health care professionals regarding direct-to-consumer advertising done by companies that adopt these principles." [13]

Consumer groups blasted PhRMA's guidelines. Commercial Alert's Gary Ruskin called them "utterly lacking in principle. They are a public relations exercise that cloaks doing nothing in a stream of verbiage that sounds like doing something. They will cause no inconvenience for the drug industry and no real change of behavior. Their aim is to shield the profits of the drug companies, not the health of Americans. Nor will they stop the fleecing of taxpayers, through excess demand for prescription drugs. ... The new PhRMA policy is even soft on erectile dysfunction ads. Parents shouldn't have to shield their children from raunchy drug ads." [14] Consumers Union called the PhRMA guidelines "a placebo that will have little impact on informing consumers about the real effectiveness of drugs or their possible safety risks." [15]

In January 2006, just after the PhRMA guidelines went into effect, Advertising Age reported, "Drug makers appear to be abiding by the 15-point code of conduct with very few exceptions. One exception: None of the ads [the reporter viewed] conformed to Guideline No. 15: Companies are encouraged to include information in all DTC advertising, where feasible, about help for the uninsured and underinsured. Also, some of the 15-second spots were not able to adhere to Guideline No. 4: DTC TV and print advertising of prescription drugs should clearly indicate that the medicine is a prescription drug" (Rich Thomaselli, "Big Pharma Keeps Its New Year's Resolution," Advertising Age, January 9, 2006).

FDA funding fees

U.S. government regulating agencies don't negotiate their budgets with industries they oversee, with the exception of the Food and Drug Administration (FDA). In the early 1990s, the pharmaceutical industry began paying the FDA millions of dollars in user fees in order to speed up the drug approval process. These fees "now fund more than half the agency's critical drug-review process." Industry groups and the FDA renegotiate the fees and how they're used every five years, giving drug makers "considerable input into which programs receive funding." In 2006 the FDA negotiated an agreement with the Pharmaceutical Research and Manufacturers of America and Biotechnology Industry Organization. Industry groups pushed for even faster decisions on labeling and other "conditions" of new drugs and the FDA negotiated more funding to monitor drug safety following approval.[25]

International activities

PhRMA lobbying activities have extended outside of the United States. "America's big drug companies are intensifying their lobbying efforts to 'change the Canadian health-care system' and eliminate subsidized prescription drug prices enjoyed by Canadians," CanWest News Service reported on June 9, 2003. "A prescription drug industry spokesman in Washington confirmed to CanWest News Service that information contained in confidential industry documents is accurate and that $1 million US is being added to the already heavily funded drug lobby against the Canadian system." PhRMA was the leading drug industry trade group behind the increased lobbying and PR campaign. PhRMA was also independently spending $450,000 to target the booming Canadian Internet pharmacy industry, which has been providing Americans with prescription drugs at lower prices than in the United States.

Personnel

  • Christopher Badgley: Vice President, State Government Affairs
  • Chris Singer: Chief Operating Officer and Executive Vice President
  • Edward Belkin: Vice President, Communications
  • Alan Gilbert: Senior Vice President, Federal Affairs
  • Mark Grayson: Deputy Vice President, Communications and Public Affairs
  • Billy Tauzin: President and Chief Executive Officer
  • Anne Holmes: PAC Contact and Senior Manager, Federal Affairs
  • William L. Lucas: Associate Vice President, State Government Affairs
  • Kurt Malmgren: Senior Vice President, Government Affairs and Alliance Development
  • Lori Reilly: Vice President, Policy
  • Richard "Rick" Smith: Senior Vice President, Policy and Strategic Communications
  • Derrick White: Associate Director, Federal Affairs

PHRMA's registered lobbyists

According to a discloure form for the first six months of 2007, filed with the U.S. Senate by PHRMA, the group's registered lobbyists were [26]:

PhRMA spent $10.7 million in the first six months of 2007 lobbying the U.S. government. In the preceding six-month period, PhRMA spent $8.8 million. Associated Press reports that in PhRMA'S latest lobbying report, required under the Lobbying Disclosure Act of 1995, the group states that it had lobbied Congress, the U.S. Food and Drug Administration and the Department of Health and Human Services and other agencies on "issues related to Medicare, patent reform, international trade and drug fees, importation and safety". [27]

PhRMA's top lobbyist during the healthcare debates in 2009-2010m Bryant Hall, started his own fimr, Rubicon Strategies, owned by the Tiber Creek Group.[28]

In 2011, PhRMA had over 35 lobbyists. The entire list can be seen HERE.

Former staff

PR firms employed

Contact

Pharmaceutical Research and Manufacturers of America
950 F Street N.W.
Washington, DC 20004
Telephone: 202-835-3400
Fax: 202-835-3414
Website: phrma.org

Articles and resources

Related SourceWatch articles

External resources

External articles

References

  1. ↑ Mike Lillis, Drug lobby defends rise in prices, The Hill, August 25, 2010
  2. ↑ Center for Responsive Politics, Lobbyists working for Pharmaceutical Rsrch & Mfrs of America 2011, OpenSecrets.org lobbying database, accessed July 8, 2011
  3. ↑ Center for Responsive Politics, Itemized Lobbying Expenses for Pharmaceutical Rsrch & Mfrs of America 2008, OpenSecrets.org lobbying database, accessed July 8, 2011
  4. ↑ Center for Responsive Politics, Itemized Lobbying Expenses for Pharmaceutical Rsrch & Mfrs of America 2007, OpenSecrets.org lobbying database, accessed July 8, 2011
  5. ↑ Center for Responsive Politics, Itemized Lobbying Expenses for Pharmaceutical Rsrch & Mfrs of America 2006, OpenSecrets.org lobbying database, accessed July 8, 2011
  6. ↑ Center for Responsive Politics, Itemized Lobbying Expenses for Pharmaceutical Rsrch & Mfrs of America 2004, OpenSecrets.org lobbying database, accessed July 8, 2011
  7. ↑ Public Citizen, PhRMA Appears to Have Funneled Up to $41 Million To “Stealth PACs” to Help Elect a Drug Industry-Friendly Congress, organizational report, September 20, 2004
  8. ↑ Christopher Viehbacher, Forbes.com, accessed July 9, 2011
  9. ↑ Private Enterprise Board, ALEC website, accessed July 8, 2011.
  10. ↑ Private Sector Executive Committee, accessed July 2011.
  11. ↑ Kristin Parde bio, ALEC website, accessed July 9, 2011.
  12. ↑ Health & Human Services Task Force (date unknown), ALEC website, accessed July 9, 2011.
  13. ↑ Julie Corcoran bio, ALEC website, accessed July 9, 2011
  14. ↑ Center for Responsive Politics, PhRMA lobbying expenditures, Open Secrets, accessed July 9, 2011.
  15. ↑ Center for Responsive Politics, [PhRMA 2010 spending, accessed July 9, 2011.
  16. ↑ Pac to Pac PhRMA,"Open Secrets.org"
  17. ↑ Center for Responsive Politics, 2006 PhRMA contributions, Open Secrets, accessed July 9, 2011.
  18. ↑ Center for Responsive Politics, 2008 PAC contributions, Open Secrets, accessed July 9, 2011.
  19. ↑ Center for Responsive Politics, 2006 PhRMA, Open Secrets, accessed July 9, 2011.
  20. ↑ 20.0 20.1 Kaiser Health News, Drug Lobby's Tax Filings Reveal Health Debate Role, AARP, Dec. 2, 2010, accessed July 9, 2011.
  21. ↑ Public Citizen, “New Stealth PACs” Secretively Spend Millions to Sway Elections;PhRMA Appears to Have Bankrolled Seniors Groups, Nov 10, 2004, accessed July 9, 2011.
  22. ↑ Chris Frates & Carrie Budoff Brown, Billy Tauzin to step down from PhRMA, Politico, February 12, 2010
  23. ↑ Chris Frates & Carrie Budoff Brown, Billy Tauzin to step down from PhRMA, Politico, February 12, 2010
  24. ↑ PhRMA, 2009 Form 990, Internal Revenue Service form filed by organization, November 11, 2010
  25. ↑ Anna Wilde Matthews, "Drug Firms Use Financial Clout To Push Industry Agenda at FDA", Wall Street Journal, September 2006.
  26. ↑ "Drug Trade Group Spent $10.7M Lobbying", Associated Press, August 17, 2007.
  27. ↑ "Drug Trade Group Spent $10.7M Lobbying", Associated Press, August 17, 2007.
  28. ↑ Top PhRMA lobbyist starts new firm, "Politico.com" 1/4/11]
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