Obama’s Sellout to the Drug Kingpins

Obama and the Democrats’ sellout on health care is hardly any secret, but today’s news of an outright backroom deal guaranteeing drugmakers control over pricing is one for the history books. Even the Republican right, so detested by liberals, doesn’t get down for big business quite like this.

Among other things, this slimy arrangement  with Billy Tauzin, head of Big Pharma’s trade association PHRMA,  throws American antitrust law out the window. This is a clearcut cartel-style arrangement, openly sanctioned by the President. All this baloney about competitive markets! It is patterned after the international oil cartel of the early part of the last century, which divvied up Middle East oil, and the U.S. automaker cartel to prevent instllation of safety devices in the 1950s and 60s.

As it now stands, there is no control over drug pricing in the United States, save for a gesture in that direction under the Medicare Part D prescription drug insurance plan for the elderly. The system currently allows drug firms to set prices they charge for prescription drugs under Medicare in what amount to sweetheart deals with the private insurance companies that actually handle the insurance under the Medicare plan. Because drug pricing and insurance costs are set—basically at will—by these two industries, critics have demanded the government step in and set prices. Those demands haven’t gone anywhere, but never has there been an explicit announcement from on high about the deal. It’s always been just another one of Washington politics dirty little secrets.

Here is the way the New York Times reported it this morning, including an extraordinary public concession from the President.

 “We were assured : ‘We need somebody to come in first. If you come in first, you will have a rock-solid deal,’ ” Billy Tauzin, the former Republican House member from Louisiana who now leads the pharmaceutical trade group, said Wednesday. “Who is ever going to go into a deal with the White House again if they don’t keep their word? You are just going to duke it out instead.”

A deputy White House chief of staff, Jim Messina, confirmed Mr. Tauzin’s account of the deal in an e-mail message on Wednesday night.“The president encouraged this approach,” Mr. Messina wrote. “He wanted to bring all the parties to the table to discuss health insurance reform.

As for $80 billion drug company voluntary gift to the President to help achieve the appearance of a bi-partisan deal for health care reform, it’s all smoke and mirrors. No more than $20 billion is to go to a widely hailed plan to help Medicare recipients by subsidizing their drugs while they are in the Medicare coverage gap known as the “donut hole.” The rest is to be doled out according to some yet to be known plan set forth by the drug makers.

In addition, as I’ve written before, the money to “help” the elderly is limited to brand name drugs, many of them coming off patent and about to go generic. The industry wants to keep on selling oldsters the expensive brand names, but Medicare recipients could save money under the existing plan by buying generic equivalents when they fall into the donut hole. Under the Big Pharma plan, elderly people who choose the name brand drug will get a subsidy–thus discouraging them from switching to generics. And of course, once they come out of the coverage gap and they’ll be charged full price once again, and the government will pay up. In the long run, it’s only likely to increase the drug companies’ private profits, at public expense. So once again, the “concessions” are all on one side.

4 responses to “Obama’s Sellout to the Drug Kingpins

  1. I never thought that anyone would be more disappointing than the Clintons after their abomination of health care reform deservedly crashed and burned, but Obama is rapidly claiming the crown from them. I didn’t – and couldn’t – vote for McCain/Palin, but I sure am glad I didn’t vote for Obama (Ron Paul got my vote as a protest).

  2. I knew. Last year, after the primaries, when as soon as Hillary was gone and Obama backtracked and abandoned every even slightly leftist thing he’d said to get the nomination. I had a suspicion before then, but that’s when I knew.

    What amazes me from outside the party is why the Democrats aren’t more upset. The Dem nomination campaign was a fight over whether the party would return to the Clinton era. The Dem party clearly said no, that they didn’t want another 8 years of Clintonism.

    But, the whole thing was a farce because the ‘opposition’ to Hillary turned to out to be lying on everything he said that made him look to the left of Hillary.

    Instead of something different, the Democrats got an administration that’s full of Clinton era alumni and which is the most right-wing, pro-business Democratic administration that I’ve seen in my lifetime.

    Oh well, don’t blame me. I voted for McKinney.

  3. FDR is rolling over in his grave! How this group of corporatist scum ever took over the Democratic party is a mystery. Obama is just another right winger like Clinton. The dems deserve to go down in flames. Once again they have left the US as the only western country that REFUSES to provide health care coverage to ALL its citizens. Neuter the blue dogs!!

  4. Pingback: Drugmaker Got Kickbacks for Nursing Home Patients « Unsilent Generation

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