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The E-Line - July 18, 2003

Drug Company Backlash Hits Fever Pitch in Congress

By Robert Novak, Chicago Sun-Times
Thursday, July 17, 2003

Republican Rep. Jo Ann Emerson of Missouri, who tearfully changed her vote three weeks ago to pass the prescription drug subsidy bill by a single vote, sent a private memorandum Monday to House Speaker J. Dennis Hastert. What about my payoff, she asked, referring to another vote to permit re-import of cheaper drugs.

Emerson need not have worried. House Republican leaders do not like re-importation, but such is its support that they must bring up the bill next week for probable passage. The pharmaceutical industry's pleas that cheap drugs from Canada will undermine research for new wonder drugs go unheeded. The more political, if less credible, argument of a threat to the safety of American patients also fails.

Agents of pharmaceutical manufacturers have been working furiously ever since the promise made to Emerson in the wee hours of June 27. Indeed, nobody outdoes the drug makers in their bipartisan array of high-priced lobbyists or their bipartisan campaign contributions. Yet, with their very existence at risk, the pharmaceuticals encounter loathing on both sides of the aisle in Congress as part of a broader epidemic of anti-corporate hysteria.

Demand for re-importing American drugs, at a dramatically lower cost to consumers because of Canadian price controls, is no longer confined to Democratic politicians from northern border states. The bill pushed by Emerson is sponsored by Rep. Gil Gutknecht, a Minnesota Republican with a 95 percent lifetime American Conservative Union rating. Emerson is a cradle Republican (88 percent ACU), the daughter of the legendary GOP operative Ab Hermann.

House Majority Leader Tom DeLay kept Gutknecht's proposal out of the prescription drug bill. He won Emerson's vote for the prescription bill during an emotional 2:30 a.m. encounter by promising a separate vote on the Gutknecht bill. That gave the usually adept Republican leadership time to win opposing votes, but their efforts so far have fallen short. Such stalwart free-market Republican House members as Jeff Flake of Arizona and Ron Paul of Texas support re-imports. So does pioneer supply-side economist Arthur Laffer.

Laffer's fellow supply-sider, Stephen Moore of the Cato Institute, found himself the only person in the room opposing the Gutknecht bill when he testified before a House Reform subcommittee June 25. ''Rather than subsidizing new drugs for seniors,'' said Moore, ''the government should withdraw from this industry altogether. The free enterprise system will bring these life-saving new wonder drugs to market more rapidly and more affordably than will government.'' Moore's thesis was totally rejected by the subcommittee chairman, doughty Indiana conservative (97 percent ACU) Dan Burton.

That is bitter fruit for an industry that in the 2002 election cycle contributed $16.3 million to Republicans and $4.4 million to Democrats. Its roster of big-time lobbyists includes Haley Barbour, Tommy Boggs, Ann Wexler, Rick Hohlt and Vic Fazio.

''I had no idea that positions were so hardened, and it seems to me driven by a visceral contempt for the drug industry,'' Greg Scandlen of the Galen Institute told his conservative e-mail correspondents Sunday. ''I don't know where that anger is coming from. I don't buy the idea that the anger is based just on differential pricing.''

It may be coming from dead-of-night legislative ploys to extend drug company patents and shield vaccine makers from lawsuits by families of autistic children (enraging Burton, grandfather of an autistic child). One pharmaceutical lobbyist, asking that his name not be used, has a theory: ''It's the image of arrogant white boy CEOs, no women or minorities, flying around in Lear jets.''

Beyond pharmaceuticals, the nation that has built amazing wealth through the profit motive may have embarked on a populist temper tantrum against corporate America. The outrage voiced by Democrats has infiltrated Republican ranks. Sen. Hillary Rodham Clinton's denunciation of the drug companies for ''putting profits ahead of people'' wins surprising Republican assent.

In truth, American companies have provided drugs for the world that scored victories over heart disease, diabetes, cancer, polio and other maladies, but now may be deprived of research funds. Would George W. Bush cast his first veto to save the geese that laid the golden eggs?

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