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Drug Lobby Wages War On Imports

Tibi swim wear models walks the runway at the Raleigh Hotel on Miami Beach during The Mercedes Benz Fashion Week Show being held at the Raleigh Hotel, Thursday, July 16, 2009.
(AP Photo/Jeffrey M. Boan)
The pharmaceutical industry's trade group spent $8.5 million in lobbying this year as it worked against a bill to allow importation of government-approved drugs.

The Pharmaceutical Research and Manufacturers of America spent the money lobbying Congress and federal agencies in the first half of this year, the most the group has ever spent in a reporting period, according to federal reports reviewed by The Associated Press. Lobbying totals cover expenses such as salaries and mailings but not campaign contributions.

Despite the group's effort, the House passed the importation plan in July as part of legislation to provide a Medicare prescription drug benefit. The Senate passed a watered-down version of the importation proposal, and congressional negotiators are trying to reconcile the differences.

Rep. Gil Gutknecht, a Minnesota Republican who sponsored the House importation plan, said he was not surprised by the trade group's lobbying figures.

"It was the most intense full-court press," he said. "Members who had been here 20 years said they had not seen anything like it."

The pharmaceutical trade group, known as PhRMA, represents major drug companies. A PhRMA spokesman refused to comment because he said the organization does not discuss its lobbying.

Many of the group's members also spent millions on lobbying in the first half of this year, including Eli Lilly and Co. ($2.9 million), Bristol-Myers Squibb ($2.6 million), Johnson & Johnson ($2.2 million), Hoffmann-La Roche ($2 million) and Pfizer ($1.8 million).

Overall, the industry has already spent more than $29 million in lobbying this year, more than any other industry, according to Political Money Line, a nonpartisan Washington Web site. The industry enjoyed about $150 billion in U.S. sales last year.

"This is an industry under siege," said Ira Loss, a senior health care analyst for the Washington Analysis Corp., a research firm for the financial industry. "The reimportation bill is only one piece of legislation the industry is not happy with."

Loss said drug companies also worry about the prospects of the federal government negotiating drug prices for Medicare recipients in an effort to contain costs.

"I don't think it's a scandal that they spent a lot of money," Loss said. "They make a lot of money, and they're trying to protect their interests."

The importation bill orders the Health and Human Services Department to set up a system that would allow importation of FDA-approved drugs from FDA-approved facilities in Canada, the European Union and seven other nations.

Imported drugs, which often sell for a fraction of the cost of the same drugs in the United States, could cost the pharmaceutical industry billions of dollars. The legislation won support in the House because of the savings it could yield consumers.

PhRMA argues that the lost revenue would stifle its research into new drug treatments, ultimately hurting patients. It also warns that people buying imported drugs risk using counterfeit or tampered products, despite a requirement in the importation bill that drugs be shipped in anti-tampering and anti-counterfeiting packaging.

It is impossible to determine how much PhRMA spent on the importation bill. The $8.5 million covers all lobbying by PhRMA, not just lobbying on the importation bill, and the report does not break down how much is spent on any one issue.
By Frederic J. Frommer