Tag Archives: conflicts of interest

AARP Lines Up Behind Pharma–Again

AARP was among the very first to register support of the drug industry’s announcement of $30 billion in price cuts to Medicare beneficiaries, which are supposed to help us out when we fall into the donut hole in Medicare Part D’s prescription drug coverage. AARP head man Barry Rand, standing behind the President in announcing the deal, said just what Big Pharma must have wanted to hear: “This is an early win for reform and a major step forward. It is a signal the process is working and will work.”

AARP is positioned as a nonprofit advocacy group for the interests of older people–and sometimes it actually acts like one. But when it comes to anything involving the health insurance business, it has private interests of its own. AARP offers Medicare supplemental policies as well as Part D policies–in fact, these insurance plans, offered in conjunction with the private insurance company UnitedHealthcare, are a major source of the group’s income.

AARP already gave one big boost to Big Pharma’s profits when it decided to support George W. Bush’s privatized Medicare Part D program, which was a boon to both the insurance and drug companies. Now its cheerleading for the pharma proposal. While it might look benevolent on the surface, the discount program will likely channel more oldsters onto brand name drugs (see yesterday’s post), or keep them there when they might otherwise switch to generics. It will also enhance the position of the Part D insurance plans, which under the law get to run the federal funded prescription program. The largest provider of this insurance is, of course, AARP/UnitedHealthcare.

Reformers have argued that drug prices can be cut if the government steps in and runs the Part D program itself, just as it runs traditional Medicare, thereby eliminating the insurance industry as a go-between. This totally freaks out the pharma guys, who not only see themselves losing business, but fear any federal extension into their protected “freemarket” will be the beginning of a domino cascade that will end up with socialists making them walk the plank. (If only!)  So Big Pharma’s discouint deal is a twofer—a sales ploy for the drug industry, and protection for the insurance companies running the Medicare program.

All of this underscores the basic politics of health care “reform.” Journalists who are wrestling to make sense out of different polls, and running back and forth from one politician to another—from Baucus to Grassley to Dodd to whoever, while listening to Obama’s earnest pleas—don’t seem to get it. Health care politics is run by a troika of the insurance industry, Big Pharma, and the doctors. And when Obama says he doesn’t care what’s in the plan, he means it. The industry guys cut the deal—not him, not the politicians on Capitol Hill.  And for God sake, least of all the public.

The Bipartisan Bull on Health Care Reform: Three Ex-Senators Get It Up for the Health Care Industry


Photo from Bipartisan Policy Center web site

As it hammers another nail into the coffin of meaningful health care reform, the Bipartisan Policy Center is laying it on thick. “Join Howard Baker, Tom Daschle and Bob Dole as they unveil their bipartisan plan for comprehensive health reform,” its web site crows, referring to a press conference that took place last week. There, the three former Senator majority leaders presented a proposal touted as “the culmination of an inclusive year-and-a-half effort that included strategic outreach to key health care stakeholders, a series of state-based public policy forums, and months of personal deliberations by the Leaders.”

Note the capital “L,” emphasizing the stature of the project’s distinguished figureheads. To drive home the momentous import of these men and their mission, the BPC is also running a video that has to be seen to be believed: Over a montage of Dorothea Lange-style black and white photos, it notes such national achievements as the eradication of child labor, polio, and racial segregation, before getting to the money shot: “Our party lines aren’t as important as what we can fix when we cross them,” the title card reads. “Let’s fix health care next.”

It’s all almost enough to make you forget that these three illustrious men are also well-paid corporate hacks, who have raked in funds from the private health care industry. And it might even distract a few people from the fact that the most noteworthy element of their celebrated “plan” is the complete absence of anything that might actually change the health care system in this country, including anything resembling a public option for health care coverage.

In the unlikely event that anyone thought Tom Daschle had an ounce of integrity running through his veins, this latest move ought to put that notion to rest. (We should all thank our lucky stars that the man is a tax evader, or  he’d be our HHS secretary and “health czar,” and we’d be in even worse shape than we are now.) After the BPC plan was released last week, Daschle made his excuses:

While I feel very strongly that consumers should have the choice of a national, Medicare-like plan, my colleagues do not. . . But we were concerned that the ongoing health reform debate is beginning to show signs of fracture on the public plan issue, so in order to advance the process of developing bipartisan legislation and to move it forward, it’s time to find consensus here….We’ve come too far and gained too much momentum for our efforts to fail over disagreements on one single issue.

Never mind that the “single issue” is the only one that stood to make even a minor dent in the nation’s system of medicine-for-profit. The Obama administration, caught once again in the net of its own bipartisan rhetoric, duly praised the man who had just stabbed them in the back: “With this report, they have demonstrated what can be achieved with bipartisan effort,” said Press Secretary Robert Gibbs. “The Bipartisan Policy Center has produced a significant report, and the White House applauds their efforts.”

As part of his earlier efforts to paint himself a reformer on this issue, Daschle wrote a book on the health care crisis called Critical. In the book, he supports some form of a public option to compete with private insurers, and also proposes a Federal Reserve-style “Federal Health Board.” “Like monetary policy,” he wrote, “health-care policy shouldn’t be subject to the whims of subcommittee chairmen and special interests.” How much better, instead, to have the special interests represented not by lowly “subcommittee chairmen,” but by a former Senate majority leader—or three.

And that’s just what’s happened here. All three of the Bipartisan Policy Center’s “Leaders” on health care reform have longstanding associations with law/lobbying firms that number health care companies among their clients. At least two of them have also profited by direct payments from the industry.

In Daschle and Dole’s case, the firm is Alston & Bird, which represents numerous health care providers, pharmaceutical companies, and nursing homes. Neither is a registered lobbyist, but that’s a fairly meaningless distinction in today’s Washington. Alston & Bird’s web site proudly advertises:

Our health care legislative and policy team has the significant advantage of including two former U.S. Senate majority leaders–Senators Bob Dole and Tom Daschle–both resident in our Washington office and champions of many health care issues in their Senate Finance Committee and leadership roles.

The site also brags of the firm’s “proven track record of achieving policy success, as well as protecting the interest of clients,” which include smoothing the progress of drug and medical device approvals, securing higher payment rates from Medicare, and “garner[ing] positive legislative changes”—in other words, changing laws to benefit the private companies it serves.

At the time of his failed nomination for HSS secretary, the New York Times reported that Daschle’s financial disclosures showed $2.1 million in earnings from Alston & Bird in the previous two years, as well “at least $220,000 for speeches to health care, pharmaceutical and insurance companies. He also received nearly $100,000 from health-related companies affected by federal regulation.”

Bob Dole had to work a little harder for his handouts from health care corporations. In 1999, Dole famously did a round of TV commercials confessing that Bob Dole had erectile dysfunction, and that Bob Dole encouraged other men in a similar predicament to consult with their doctors. The ads were framed like public service announcements, but Dole was paid an “undisclosed amount” by Pfizer, manufacturer of the billion-dollar boner pill Viagra.

In 2005, Dole was back on Pfizer’s payroll, promoting the new Medicare prescription drug plan, the government’s mammoth handout to insurance and pharmaceutical companies. Dole did a national “educational” speaking tour, funded by Pfizer, where he presented the “Ten Things Seniors Need to Know about Medicare’s New Prescription Drug Coverage.”

Howard Baker earned his money from the health care industry in somewhat more understated ways. His law firm, Baker Donelson, has defended HMOs, hospitals, and physicians practice management companies against litigation of various kinds, and also helps them fight unionization by health care workers. Until recently, one of the lobbyists working for Baker Donelson was Tom Daschle’s wife Linda, whose conflicts of interest are legion.

The Bipartisan Policy Center itself also has a network of ties to the health care industry, as detailed by Sam Stein on the Huffington Post. On its tax forms, the BPC identified drug manufacturer Schering-Plough as a “substantial contributor”; it is also one of 16 members of the organization’s “Leader’s Council.” The co-director of the BPC’s health care project is Chris Jennings, a former Clinton White House staffer whose company, Jennings Policy Strategies, “has earned millions of dollars in lobbying fees from companies with interests in the health care debate,” including several members of Big Pharma, Stein reports.

Asked about any “non-negotiable” elements in the health care reform proposal he helped draft for the BPC, Bob Dole said: “If you want to stop this thing dead in its tracks, or dead on arrival, in my view you put the public plan in it.”

And if you want to make sure the public plan dead is DOA, just put the likes of Dole, Daschle, and Baker on the case.

The FDA and Big Pharma: Watchdog or Lapdog?

Yesterday I wrote about the latest Big Pharma scandal to crawl out from under a rock. It shows, once again, the extent to which many doctors—in this case, psychiatrists—are compromised by their relationships with the drug companies, and the damage these conflicts of interest can do to patients. The same is true of the Food and Drug Administration—and in a way, that’s even worse, since the FDA is supposed to be our watchdog, and has instead too often become Big Pharma’s lapdog.

In an op-ed in yesterday’s Boston Globe, Marcia Angell offers a seven-point agenda to “restore the FDA to its purpose, which is to protect the public from unsafe food, drugs, and devices, not to accommodate the industries it regulates.” She sees the appointment of industry critic Joshua Sharfstein as deputy FDA commissioner as a promising sign—but only a beginning.

Angell, who teaches social medicine at Harvard Medical School and wrote a sharp book on how Big Pharma operates, suggests a series of changes to the system under which drugs are developed, approved, and marketed. Personally, I’d like to see something slightly more dramatic—maybe along the lines of replacing the lab animals used to test new drugs with pharmaceutical company executives. But as a realistic starting place for public policymaking in this area, Angell’s agenda is as sound as anything I’ve seen. 

(A shout-out to the PharmaGossip blog, which alerted me to this op-ed.)

Big Pharma Psychs Out the Shrinks

Just about everyone by now knows how the drug industry works to poison the minds of American doctors—not that many of them have resisted drinking the Kool-Aid, which comes in the form of ego-tripping awards, junkets, dinners, research funding, and cash in exchange for endorsing or prescribing the latest and most lucrative drugs. But even against this backdrop of sleaze, the latest news on the ties between Big Pharma and Big Psych could take your breath away.

freud-pill-boxIt turns out that not just some, but most of the shrinks who wrote the American Psychiatric Association’s most recent clinical guidelines for treating depression, bipolar disorders, and schizophrenia—which together account for $25 billion in prescription drug sales annually—had financial ties to drug companies, according a study to be published in Psychotherapy and Psychosomatics, as reported in the Boston Globe.

Summarizing the findings, which were compiled by researchers largely from public records, the Kaiser Daily Health Policy Report states:

According to the study, 18 of the 20 authors of the guidelines had at least one financial tie to drug companies. Twelve authors had ties in at least three categories, such as consulting, research grants, speaking fees or stock ownership, the study found. In addition, the study found that all of the authors of schizophrenia and bipolar guidelines had relationships with the drug industry, while 60% of the authors of the depression guidelines had such connections. According to the study, more than 75% of the authors received funding for research from drug companies. In addition, one-third of the authors served on the speakers’ bureaus of drug companies, the study shows.

As anyone who’s suffered from any kind of mental health problem knows, treatment for these kinds of problems is a highly inexact science. A shrink can’t give you a blood test or an MRI to figure out precisely what’s wrong with you. So it’s often a case of diagnosis by prescription: If you feel better after you take an anti-depressant, it’s assumed that you were depressed; if you don’t feel better, well, then maybe they’ll try you on an anti-anxiety pill, or a low dose of a bipolar drug, and see how that works.

As one of the researchers for the study put it, “the lack of biological tests for mental disorders renders psychiatry especially vulnerable to industry influence.” For this reason, she argues, it’s particularly important that the guidelines issued by psychiatry’s leading professional organization be compiled “on the basis of an objective review of the scientific evidence”—and not on whether the doctors writing them got a big grant from Merck or own stock in AstraZeneca.

Perhaps there’s another reason why these conflicts of interest are so extreme in the field of mental health. You would expect that after news like this, confidence in the psychiatric profession would drop through the floor, and patients would begin to take their shrinks’ diagnoses with a boulder of salt. But many psychiatric patients are desperately ill, highly vulnerable, and not in any position to be skeptical medical consumers.

A growing body of evidence suggests that the drug companies purposefully push doctors to push drugs on exactly these types of patients—the ones who are  least equipped to push back. Look at the recent case of pharmaceutical giant Eli Lilly, which agreed to pay a record $1.4 billion dollars to settle charges that it illegally marketed the anti-psychotic drug Zyprexa as a treatment for Alzheimer’s and other forms of dementia in elderly patients. This despite the fact that the drug was not only unapproved for this “off-label” use, but had also been shown to cause obesity and diabetes—as this former Eli Lilly rep explains.

Now, $1.4 billion might sound like a tough punishment, until you find out that Lilly’s total sales of Zyprexa have topped $37 billion. And at least some of those sales were thanks to doctors who, with guidance from Lilly drug reps, wrote thousands of prescriptions for patients with virtually no ability to defend themselves. Can you imagine an easier group for the drug companies—and their shills in the medical profession—to victimize than old people with dementia?

After spending some time reporting on the drug industry, I can easily picture Big Pharma’s executives sitting around in their board rooms, planning which wretched, unprotected group of patients they’re going to target next. 

Then again, maybe I’m just paranoid. I’m sure there’s a pill for that.

Why the Senate Is Asking the Wrong Questions About Tom Daschle’s Finances–and Why Obama’s Lobbyist Pledge Doesn’t Mean Much

As the Senate Finance Committee continues to review HHS nominee Tom Daschle’s financial records, and Daschle himself apologizes for “the errors that required me to amend my tax returns,” what isn’t commanding attention seems far more significant than what is.

There are plenty of things in Daschle’s financial history that ought to  alarm everyone involved a lot more than a car and driver he forgot to report to the IRS. Apparently, however, neither the Committee nor the White House are much bothered by the riches Daschle has quite legally reaped from private health care companies–a fact that in itself reveals the inherent weaknesses in Obama’s ban on former lobbyists serving in government.

Massachusetts Senator John Kerry was one of several leading Democrats who defended Daschle on the Sunday morning news shows. Kerry declared that Daschle’s tax issues were an “innocent mistake” that would not affect his ability to perform his job “one iota.”

Yes, it’s probably true that being driven around in a Cadillac and not paying taxes on it won’t compromise Daschle’s ability or independence as HHS secretary or “health czar.”  The same cannot be said about all the income that Daschle did report to the IRS. As described by the New York Times:

As a politician, Mr. Daschle often struck a populist note, but his financial disclosure report shows that in the last two years, he received $2.1 million from a law firm, Alston & Bird; $2 million in consulting fees from a private equity firm run by a major Democratic fundraiser, Leo Hindery Jr. (which provided him with the car and driver); and at least $220,000 for speeches to health care, pharmaceutical and insurance companies. He also received nearly $100,000 from health-related companies affected by federal regulation.

Mr. Obama has instituted rules requiring former lobbyists in his administration to pledge not to deal with former clients, though he has made exceptions for two nominees, one at the Pentagon and one at the health agency. As a strategic adviser to companies, Mr. Daschle did not have to register as a lobbyist, and is not technically covered by those rules.

“He’s never lobbied, therefore he’s not in violation of the pledge,” Mr. Gibbs said. “The president is comfortable with Senator Daschle’s variety of experiences and backgrounds. It’s why he believes he’s best suited to the efforts to reform our health care system.”

In fact, InterMedia Advisors, the private equity firm that provided him with the car and driver, is one of the few sources of  Dascle’s income that had nothing at all to do with the health care industry (though it does own a few questionable properties, including the magazines Guns & Ammo, Handgun, and Shooting Times–all of them acquired while Daschle was chairman.)

When Daschle was first nominated, the Times described his role at Alston & Bird, which “represents dozens…of pharmaceutical companies, health care providers, and trade groups for nurses and nursing homes”:

Although not a registered lobbyist, Mr. Daschle, a South Dakota Democrat who was party leader in the Senate, provides strategic advice to the firm’s clients about how to influence government policy or actions. The firm’s Web site declares, “Our health care legislative and policy team has the significant advantage of including two former U.S. Senate majority leaders–Senators Bob Dole and Tom Daschle–both resident in our Washington office and champions of many health care issues in their Senate Finance Committee and leadership roles.”

As examples of the firm’s achievements the Web site lists matters involving Medicare and Medicaid reimbursements, approvals of federally regulated drugs and medical products, fraud investigations, medical waste disposal, privacy and other compliance issues.

Daschle, of course, is no different from hundreds of other high-stature elected officials who use their political influence to provide what Alston & Bird calls “significant advantage” to private corporations dealing with the federal government. Few of them ever become registered lobbyists–so few would be disqualified by Obama’s pledge.

The future of health care reform depends largely on the Democrats’ ability to stand up to the drug companies and insurance companies who drive up costs and drive down access and benefits. As HHS secretary and health czar, Tom Daschle will lead this reform effort. Personally, I’m less concerned about his tax-free car rides than I am about his work on behalf of the very industries he must now reign in for the public good.