February 20,2020

ICYMI: How the Drug Lobby Lost Its Mojo in Washington

A rift between the GOP and its longtime pharmaceutical-industry allies is shaking up policy, as Republicans and Democrats join to overhaul price regulations

By Brody Mullins and Stephanie Armour
February 19, 2020
The drug industry doesn’t pack the lobbying punch it once did, and one sign is something rare in the capital today—a dose of bipartisanship.
Sen. Chuck Grassley (R., Iowa) joined Sen. Ron Wyden (D., Ore.) to write a bill last July to regulate prescription-drug prices, an idea the industry has bottled up since the 1960s.
A growing rift between the GOP and longtime drug-industry allies is shaking up pharmaceutical policy, and for the first time in a generation, some Republicans and Democrats are joining to overhaul drug-price regulation.
Mr. Trump told a crowd of retirees this October he wouldn’t be surprised if the drug lobby was behind the effort to impeach him. “We’re lowering the cost of prescription drugs, taking on the pharmaceutical companies,” he said at the Florida event. “They come at you from all different sides.”
Now, voter dismay about drug prices, backlash over the opioid crisis, miscalculations by the drug industry and its lobbyists, and the populist wave that carried Mr. Trump to the presidency, are loosening Republicans’ ties to the industry and opening the door to regulation.
Americans are generally happy with their health-care coverage but worry about rising costs, surveys show.
Prescription drugs are a particular sore point because consumers typically see the tab directly. Prescription-drug spending by individuals and payers rose to $1,025 in 2017 from $819 in 2010, according to an analysis of federal data by the Peterson Center on Health Care and the Kaiser Family Foundation, though they have dropped somewhat since then. Nearly eight in 10 Americans blame drug-industry profits for increased health-care costs, a Kaiser poll in October found.
Public perception of drug companies is the lowest since Gallup began polling about industries in 2001.
At a Senate hearing last February, he and other Republicans grilled CEOs of seven drug companies on pricing. “Something is fundamentally broken in our system” if consumers abroad pay far lower prices for drugs, Mr. Cassidy told the executives.
Mr. Cassidy also told the executives drug companies need financial incentives to invest in finding groundbreaking treatments, a point the industry executives at the hearing echoed. AbbVie Inc. CEO Richard Gonzalez said at the hearing that requiring drugmakers to match European prices would mean his company wouldn’t “be able to invest in the level of R&D that it invests today.”
Mr. Cassidy later voted for Mr. Grassley’s bill to limit drug prices.
An early split with Republicans came in 2010, when the industry supported Mr. Obama’s Affordable Care Act after Democrats dropped efforts to limit drug prices.
Further trouble came after Mr. Grassley took over the Senate Finance Committee in early 2019 and began an effort to draft bipartisan drug-price legislation. Rick Scott of Florida and seven other Republican senators sent a letter to PhRMA in June asking for solutions to “soaring drug prices.” When PhRMA wrote back in July, Mr. Scott tweeted that the response “does not provide a single answer to our questions. That’s unacceptable.”
Mr. Scott’s office says PhRMA “still can’t come up with a single solution or idea. It’s sad, but not surprising.”
The Trump administration announced a plan in May to require drug companies to disclose list prices on TV commercials. A month later, Amgen Inc., Merck & Co. and Eli Lilly sued to block it. When a federal court in July ruled in their favor, Mr. Trump was upset, telling health-care advisers to accelerate work on a measure letting U.S. consumers pay the same for drugs as people abroad, says a person familiar with the episode. PhRMA created a website to disclose list prices of its drugs.
Other White House proposals are now in the works, as Mr. Trump focuses on moving Mr. Grassley’s bill. “Many excellent provisions are being considered on Capitol Hill, including Grassley-Wyden which is a genuine bipartisan approach,” the White House spokesman says.
The legislation has drawn some Republican support, and the Democratic-controlled House approved its own plan last year. The Grassley bill’s Senate prospects are uncertain—it is up to Mr. McConnell, a longtime industry champion, to bring it to the floor. He hasn’t scheduled Mr. Grassley’s bill for a vote.
In his State of the Union address this month, Mr. Trump called for drug-pricing legislation. “Get a bill on my desk,” he said, “and I will sign it into law immediately.”