By Jim Drinkard, USA TODAY
1998 – 2004
Since 1998, drug companies have spent $758 million on lobbying – more than any other industry, according to government records analyzed by the Center for Public Integrity, a watchdog group. In Washington, the industry has 1,274 lobbyists – more than two for every member of Congress.”They are powerful,” says Sen. Chuck Grassley, R-Iowa, chairman of the Senate Finance Committee. “You can hardly swing a cat by the tail in that town without hitting a pharmaceutical lobbyist.”Over the years those lobbyists have been very successful, demonstrating that the industry knows politics as well as it knows chemistry. Drug companies won coverage prescription drugs under Medicare in 2003 while blocking the government from negotiating prices downward. They have so far kept out imports of cheaper medicines from Canada and other countries. And they have protected a system that uses company fees to speed the drug-approval process.
Mar 7, 1994
U.S. DRUG INDUSTRY FIGHTS REPUTATION FOR PRICE GOUGING:Pharmaceutical Makers Focus Energies on Advertising and Target Key Legislators U.S. By NEIL A. LEWIS with ROBERT PEAR Special to The New York Times.New York Times (1857-Current file). New York, N.Y.: Mar 7, 1994. pg. A1, 2 pgs
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Abstract (Document Summary) |
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WASHINGTON, March 6 — When President Clinton stood before an audience at an Arlington, Va., health clinic last year and characterized the pharmaceutical industry as a bunch of price gougers,executives of the nation’s drug companies had what their scientists might call a convulsive reaction. |
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Comment: The average increase from the cost of the ingredients of the following 16 drug to the consumer price was 79,000%, or the drugs sell for almost 800 times cost of their ingredients. WOW !!! This is not price gouging, but rather it is criminal activity. |
The chart below speaks for itself.
Budget Analysis, US Department of Commerce, 2004 |
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| Drug | Amount | Cost of Ingredients |
Consumer Price |
Percent Markup |
Celebrex Prozac Claratin Tenomin Keflex Vasotec Lipitor Xanax Norvasec Zestril Paxil Zithromax Prevacid Zocor Prolosec Zoloft |
100 tabs 100 tabs 10 mg 100 tabs 250 mg 100 tabs 100 tabs 100 tabs 100 tabs 100 tabs 100 tabs 100 tabs 100 tabs 40 mg 20 mg 50 mg |
$0.60 $0.11 $0.71 $0.13 $1.88 $0.20 $5.80 $0.024 $0.14 $3.20 $7.60 $18.78 $1.01 $8.63 $0.52 $1.75 |
$130.27 $247.47 $215.17 $104.47 $157.39 $102.37 $272.37 $136.79 $188.29 $89.89 $220.27 $1,482.19 $44.77 $350.27 $360.97 $206.87 |
21,712% 249,973% 30,306% 80,362% 8,372% 51,185% 4,696% 569,958% 134,493% 2,809% 2,898% 7,892% 4,433% 4,059% 69,417% 11,821% |
| Average | 78,416% | |||
The president of the United States, in 1994 called the Drug Companies “Price Gougers” after a government study found that drug selling prices were on average marked up 800 fold from the costs of manufacturing.
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Of the 1,274 people registered to lobby in Washington for drugmakers in 2003, (there were 623 in 2001) according to the Center for Public Integrity, 476 are former federal officials – including 40 former members of Congress. “They are one of the strongest, most well-connected and most effective lobbies in Washington,” says Amy Allina of the National Women’s Health Network. “Going up against them is more often than not a losing battle.” Drugmakers also sell their message through TV advertising. Two of the top 10 ad spenders during the last session of Congress were pharmaceutical companies, GlaxoSmithKline and Pfizer. A study by the Annenberg Public Policy Center at the University of Pennsylvania found they spent a combined $45.1 million on advertising in 2003-04, the largest chunk of it to promote the expansion of Medicare to cover prescription drugs. In addition, the industry pours growing amounts into political campaigns, favoring Republicans – who control the White House and Congress – over Democrats by about 2 to 1. In last year’s elections, the top Senate recipient of pharmaceutical campaign money was North Carolina GOP Sen. Richard Burr, a member of Enzi’s panel. He got $288,684, according to a tally by the non-partisan Center for Responsive Politics. In the House, Rep. Mike Ferguson, R-N.J., was the top recipient, with $264,560, roughly 10% of his total fundraising. He’s a member of the House Energy and Commerce Committee; it has jurisdiction over the drug industry, which has a heavy presence in his state. Pharmaceutical makers also were among top donors to the national conventions last year. They gave $4.7 million to help put on the GOP event in New York and $2.6 million for the Democrats’ gathering in Boston.Drug companies court lawmakers and their aides by paying for trips to industry meetings or to tour company plants and other facilities. Dozens of such trips took place last year, disclosure records filed in the House and Senate show. For example, a group of sponsors including PhRMA and GlaxoSmithKline paid $8,810 to take Rep. William Lacy Clay, D-Mo., to Brazil on a “fact-finding mission.” GlaxoSmithKline paid $1,079 to fly Sen. Orrin Hatch, R-Utah, to Houston for a speech
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A new Public Citizen report shows how pharmaceutical companies and their trade associations used hundreds of lobbyists and millions of dollars to influence Congress and the administration. The full bill for this massive buttonholing operation recently became public with the availability of nearly all lobby disclosure reports for the year 2001. Using these lobbying reports, along with information about the lobbyists’ “revolving door” connections, Public Citizen’s investigation shows the following:
Overall, drug companies spent $78.1 million on lobbying in 2001, bringing the total lobbying bill for 1997-2001 to $403,071,467. The companies employed 623 different individual lobbyists in 2001 – or more than one lobbyist for every member of Congress.
The 10 most active drug companies and industry groups spent 16 percent more on Washington, D.C. lobbying in 2001 than the previous year. They increased the number of lobbyists they employed by 30 percent.
340 of those lobbyists (54 percent) have “revolving door” connections; in other words, they previously worked in Congress or another branch of the federal government. 23 of the 623 lobbyists are former members of Congress. 32 of the lobbyists worked for the two House committees writing the Medicare prescription drug legislation.
This army of lobbyists waged several successful campaigns. Congress did not create a Medicare drug benefit; the industry’s monopoly patent protections were not weakened; the pediatric incentive granting an extra six months of patent protection if a company tests the safety of its drugs in children was re-authorized (at a cost of $14 billion to consumers); and legislation giving U.S. consumers access to prescription drugs sold at significantly lower prices in foreign countries was not adopted.
In 2001, brand-name drug companies outgunned the generic drug companies they often compete with. Brand-name companies accounted for 97 percent of all pharmaceutical lobbying spending ($75.7 million out of $78.1 million). Brand-name companies also employed nine lobbyists for every one employed by generic companies.
These lobbying expenditures only include what the industry spent in Washington to lobby Capitol Hill and the executive branch. It does not include issue ads, fake “grassroots” mobilizing or campaign contributions. From 1997 to 2002, the drug industry gave $37,344,834 to candidates and parties.
A copy of Public Citizen’s report is available at:
http://www.citizen.org/congress/campaign/special_interest/articles.cfm?ID=7827
 By Dennis Cauchon, USA Today, Sept, 2001 “Drug companies and the FDA” |
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This goes on all the time, with researchers leaving universities, going to government agencies, and then leaving there for executive positions in business where they cash in on all the contacts they’ve made during the earlier years. It isn’t even considered unethical. While drug companies must submit direct-to-consumer advertisements to the U.S. Food and Drug Administration (FDA), the agency’s review of drug ads is often not completed until after the ad has been widely circulated. What does this mean for consumers? Advertised drugs are not necessarily safe, and drug advertisements should be looked at with discretion. If the FDA finds a drug ad to be false or misleading, it will issue a regulatory letter to the manufacturer. In the late 1990s, the FDA issued more than 100 such letters per year, but as of November 2002, only 24 had been issued for the year. The decrease, thought to be the result of a new legal review of proposed regulatory letters, has raised concerns that potentially misleading drug advertisements may be gaining public exposure. According to a Consumer Reports analysis of Food and Drug Administration (FDA) regulatory letters from 1997 to 2002, the Food and Drug Administration (FDA) charged drug companies with a variety of violations including omitting or minimizing drug risks, exaggerating the effectiveness of a drug, promoting unapproved uses for a drug, making false claims that a drug is superior to another, promoting drugs which are still experimental, using inconsistent or incorrect labeling information, and giving misleading or false information to doctors. Drug ads which received the most letters citing violations from the Food and Drug Administration (FDA) since 1997 included: |
| Claritin (allergy drug, 11 letters) Avapro (blood pressure drug, 7 letters) Flonase (allergy drug, 7 letters) Flovent (asthma drug, 7 letters) Celebrex (arthritis drug, 6 letters) Vanceril (asthma drug, 6 letters) Xenical (weight-loss drug, 6 letters) Zyrtec (allergy drug, 6 letters) Allegra (allergy drug, 5 letters) Avandia (diabetes drug, 5 letters) Ditropan (bladder problems drug, 5 letters) Pravachol (cholesterol drug, 5 letters)Source: Consumer Reports February 2003 68:(2)33-37 |
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Anyone who has tried to quit the anti-depressant ‘Paxil’ will tell you that the TV ads which claim that Paxil is not ‘habit-forming’ is misleading. Many people who take Paxil experience SEVERE withdrawal symptoms when trying to get off the drug, from tremors to cold sweats to “electric zaps to the brain” (not painful but very uncomfortable). The Paxil withdrawal is SEVERE. What is concerning is that consumers tend to believe that drug ads are regulated. According to one recent study(6), some 43% of participants believed, falsely, that only ‘completely safe’ drugs could be advertised. As i said at the beginning of this article, drugs are sometimes appropriate and at times can save a person’s life, but most of the time they are unnecessary, expensive and harmful. You would be well advised to recognize that you should seek natural therapies which address the cause of the disease before choosing a drug-based solution. 46% of Americans take at least one prescription drug daily. (1) Although drugs are sometimes appropriate and at times can save a person’s life, most of the time they are unnecessary, expensive and harmful. My advice would be to recognize that you should seek natural therapies which address the cause of the disease before choosing a drug-based solution. I can assure you that the number of people who actually need drugs is a small percentage of those taking them. For example, people are being prescribed drugs for heartburn when it is one of the easiest health problems to treat. Most people ignore the fact that heartburn is an important clue from their body and rely on a drug instead to suppress the symptoms. In case you haven’t figured it out by now, the major reason for the traditional medical paradigm is the influence of the most powerful industry in the United States, the drug companies. Drug companies exert a major influence on the majority of studies published and nearly all of medical education. This influence is what causes doctors to use their expensive symptomatic ‘patch-up’ drugs as solutions for people’s problems. Drug companies have been able to get away with their high prices because the vast majority of people do not pay for their medications anymore. It’s insurance companies that are picking up the tab. Since most people do not pay for it directly, drug companies are able to get away with charging outrageous prices. The drug companies claim that they need large earnings – 125,835,595,000 in 1999 (2) – to conduct their research and development. They have a point – only up to a degree. Aggressive research is indeed needed. The medications produced by the pharmaceutical industry have improved the quality and length of life of many people. But this justification loses credibility when:
Drug companies are the most profitable industry. In 2001, a year which saw a drop in employment rates, a plunge in the stock market and symbols of America’s economy literally come crashing down, the drug companies continued their reign as the most profitable industry in the annual Fortune 500 list. While the overall profits of Fortune 500 companies declined by 53%, which was the 2nd biggest dive in profits the Fortune 500 has taken in its 47 years, the top 10 U.S. Collectively, the 10 drug companies in the Fortune 500 topped all 3 of the Fortune magazine’s measures of company profitability for 2001, according to the magazine’s annual analysis of America’s most important companies. These drug companies had the greatest return on revenues, reporting a profit of 18.5 cents for every $1 of sales, which was 8 times higher than the median for all Fortune 500 industries, easily surpassing the next most profitable industry, which was commercial banking with a 13.5% return on revenue)(3). The system is badly broken and in need of a change. We cannot spend over one trillion dollars for health care just to improve profits for drug companies. We have the capital to more than adequately treat nearly all people. What we need to do is shift our perspectives and priorities. This emphasis on drugs is one of the main reasons why spending for prescription drugs is the fastest-growing category of health care expenditures. It is also one of the major factors contributing to the fact that doctors are a major leading cause of death in the United States, due to the fact that they have an over reliance on using drugs as ‘patch-up’ solutions, rather than seeking the cause of the problem. In 1998 an extensive study published in the reputable Journal of the American Medical Association (JAMA) showed that 106,000 people die each year in American hospitals from medication side effects (4). Let’s look at this statistic a different way: 106,000 deaths a year averages out to nearly 300 deaths per day, every day. Deaths from all major airline crashes in the U.S. average less than 300 annually, but 1 airplane crash gets more media attention and governmental scrutiny than the 300 medication-related deaths which occurred not only on the same day as the airline crash, but also every day before and after for decades. Why has this epidemic of side effects gone unrecognized? Deaths from medication reactions rarely look any different from natural deaths. There’s no visible wreckage to videotape, no crash sites to fascinate and horrify TV viewers. As media people say, ‘No film, no story’. Media and public relations firms, and how they shape the public’s awereness, are discussed in more detail here. Medication deaths often occur quietly in hospitals, emergency rooms and private homes. When medication-related deaths occur, it’s often unclear at first whether the cause was the medication, the illness, or some other factor. In other words, to much of the media, there is nothing sexy about side effects. The reported adverse effects of drugs are only the tip of the iceberg. Consider ‘Digoxin’, the best-selling heart drug. According to an article in JAMA, the Food and Drug Administration (FDA) receives about 82 reports each year involving Digoxin, yet a systematic study of Medicare records reveals 202,211 hospitalizations for Digoxin adverse effects in a 7-year period (5). That’s more than 28,000 reactions per year, 82 of which the Food and Drug Administration (FDA) hears about. Think you know for sure that the drug you are taking is absolutely safe? Think again. Many drugs spend years on the market before being taken off the market because of dangerous side-effects which surface. Aggressive marketing, slanting research, unethical publishing of results, influencing physicians, intimidating researchers, pressuring medical centers, manipulating the FDA, limiting information, marketing drugs with inaccurate safety information – all of these have created an environment in which drug development has become a race for the bottom line. Knowing how the drug companies operate, it is no surprise when new dangers are revealed with drugs we’ve been using for decades and drugs are subsequently taken off the market. Some of these withdrawn drugs, such as ‘Redux’, ‘Seldane’, ‘Propulsid’, ‘Rezulin’ , were prescribed MILLIONS OF TIMES. According to Dr. Alastair J.J. Wood, Assistant Vice Chancellor for Research at the Vanderbilt University Medical Center (1), a staggering 19.8 million patients (almost 10% of the United States population) were estimated to have been exposed to just 5 of the 10 drugs withdrawn in the past 10 years. (see below for the list) Dr. Wood added, “None of the drugs was indicated for a life-threatening condition nor, in many cases, were they the only drugs available for that indication”.(2) Safer alternatives to these drugs existed, but intense marketing convinced doctors to prescribe them anyway. Drug companies can profit handsomely from such drugs. ‘Seldane’, the top-selling antihistamine in the world for more than a decade, was on the market for 13 years until the Food and Drug Administration (FDA) removed it in 1997, 7 years after the drug’s cardiac toxicities were identified in 1990 (3). Rezulin’, a diabetes drug withdrawn by Britain in 1997, wasn’t withdrawn by the Food and Drug Administration (FDA) until 2000, during which time Warner-Lambert earned $1.8 billion (4).
These drugs were taken off the market because of serious, often lethal side effects.
In addition to the 3 billion dollars they spend on direct marketing to consumers, drug companies are spending about 15 billion dollars per year on marketing to doctors. Most physicians have no idea that the drug companies are spending on average $10,000 per doctor to influence their behavior. The doctors do not receive a check, of course, but the perks are significant. Doctors also don’t realize that they actually lose that much income and more if they factor in the time that they lose by sitting with the drug company representatives and going to their ‘free’ lectures and meals. Doctors also often overlook what a fiduciary responsibility is, and therefore don’t realize that they need to analyze carefully the costs involved in recommending expensive prescription drugs. Doctors cause patients to divert much of their hard-earned income to the drug companies, which further perpetuates this indirect physician subsidy. All this results in prescription drugs being the fastest-growing category of health care expenditures in the United States. “Informed consent can be effectively exercise only if the patient possesses enough information to enable an intelligent choice” (AMA, 1999). THE MEDICAL PROFESSION’S CULTURE OF CORRUPTION, PART 1: Respected Physicians Call for End of Conflicts of Interest with Drug Industry. There have been many calls for reform of the broad influence of pharmaceutical industry money on doctors and other health professionals, hospitals, and medical centers, but few have been so sweeping as the recent article in the Journal of the American Medical Association by Dr. Troyen Brennen of Harvard Medical school, Dr. Jerome Kassirer, who was an editor of the New England Journal of Medicine, and 9 other authors.1 The drug industry has been roundly criticized for its intense, diverse, and unrelenting efforts to influence doctors and sell more drugs. The criticism has accomplished little, and drug sales have soared. The analysis by Brennen et al. focused on the medical profession, acknowledging that “physicians’ behavior is a large part of the problem,” and that the stature of the medical profession and the trust of patients have been jeopardized by medicine’s many conflicts of interest with the drug industry. Approximately $19 billion is spent annually by drug companies for marketing to doctors. Tens of thousands of sales representatives descend on doctors’ offices every day. Patients in doctors’ waiting rooms are often outnumbered by drug reps (typically young, female, attractive). Many doctors deny that gifts and other freebies influence their decisions about medication treatment. Drs. Brennen et al. disagreed: “Social science research demonstrates that the impulse to reciprocate for even small gifts is a powerful influence on people’s behavior. Individuals receiving gifts are often unable to remain objective …. Receiving gifts is associated with positive physician attitudes toward pharmaceutical representatives. … The rate of drug prescriptions by physicians increases substantially after they see sales representatives, attend company-supported symposia, or accept samples.” Indeed, studies have shown that the drug company influences on doctors often lead to irrational decisions and have a negative impact on the treatment of patients.1 I am not surprised by these findings. Decades of research have allowed marketers to learn how to influence anyone without his/her knowing it. Doctors are not immune. Moreover, drug companies are subtle. They not only provide gifts and dinners and seminars, but also leave behind carefully select studies that support the use of their drugs. The overarching goal is to control the information that doctors receive about medications. Drug companies write the package inserts of all drugs, carefully including the information they choose and omitting information they want to avoid.2Drug companies underwrite a large percentage of continuing education courses for doctors. In doing so, they make sure that the speakers represent the company view. Drug companies design studies that are meant to produce favorable results and then publish the studies in medical journals. Studies with unfavorable results are not published. Drug reps typically bring stacks of studies, all favorable, which impress doctors, who no longer have the time or motivation to search the medical literature themselves. Drug reps do not include independent studies with less favorable conclusions. Many doctors never see these. The proposals of Brennen et al. make sense and are long overdue. But will they work? Will they even be implemented? Many calls for reform have been issued previously. Some reforms have been implemented, but they have been largely ineffective. So far, medical institutions have balked at implementing strong, enforceable rules. Doctors are independent sorts, and many still insist that they are entitled to receive gifts and other benefits if drug companies want to provide them. Academic institutions do not want to have to police their medical faculty members. Worse, many academic institutions have become dependent on drug company money and have long become inured to drug company influences. This was best described in 2000 by Dr. Marcia Angell, then the editor-in-chief of the New England Journal of Medicine. Her astonishing article (“Is Academic Medicine for Sale?”) described a situation that has not improved: Academic medical institutions are themselves growing increasingly beholden to industry…. Some academic institutions have entered into partnerships with drug companies to set up research centers and teaching programs in which students and faculty members essentially carry out industry research…. When the boundaries between industry and academic medicine become as blurred as they now are, the business goals of industry influence the mission of the medical schools in multiple ways….3. With so many high-ranking doctors having financial ties to the drug industry, are there enough doctors who are independent financially or at least in conscience to consider reining in this compromised system? Maybe not. Drug companies are smart. They long ago realized that if they hired as consultants all of the top experts in every medical field, they could sway the entire medical profession with their slant. The result is that today, few independent experts remain. For example, when the FDA convenes medical advisory committees to discuss problems involving medications, it is usually impossible for the FDA to find enough independent experts to outnumber or even equal the experts with drug company ties. At some meetings, 90% of the experts have financial arrangements with drug companies.4 So the main question is not whether the proposals of Brennen et al. make sense. They do. Absolutely. The question is whether there is enough objectivity, independence, and will in the medical community to follow through. Or has the deliberate strategy of the drug industry to influence medical science and medical experts and medical institutions as much as possible already proceeded beyond control? This brings us to a question raised by another top medical journal, Lancet: “Just How Tainted Has Medicine Become?” I will discuss this article soon in Part 2 of “The Medical Profession and the Culture of Corruption.” Finally, there is an irony in the publication of the Brennan article at this time when corruption in Washington has led to the resignation of the majority leader of the House of Representatives, and scores of politicians are trembling in anticipation of revelations by indicted lobbyist Jack Abramoff. Washington will enact reform, but will it be serious or window dressing? The same question applies to the medical profession and its conflicts of interest with the drug industry. Attempt to Control Nutrition
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