PhRMA Speaks! And We All Listen
The marketing reach of the pharmaceutical industry is deep and pervasive. Among the top four U.S. drug makers, marketing expenses last year were at least double the amount spent for scientific research and development. Pharmaceutical marketing is a wide-ranging set of activities that includes direct-to-consumer advertising (which has proliferated wildly since being deregulated in 1997); informative productions (such as those consumer health segments that fill space on local news broadcasts); or "issue awareness visits" with state and national elected officials (lobbying). Pharma money goes for the bagels and coffee consumed at a hospital's grand rounds session; an HIV community's "Meet the Doc" event at a nice hotel; and the slides and text preparation for a researcher's plenary talk at a major scientific conference. Drug company dollars also support hundreds of HIV outreach and educational programs for rural, urban or hard-to-reach populations, help float a raft of publications (including this one), and pay for meetings that bring treatment advocates together who would not otherwise meet. Arguably, the drug companies have kept the HIV treatment activist movement alive, not only through unrestricted educational grants and travel budgets, but by serving as a lightning rod to focus community interest over certain hot-button issues. Whether for a product pitch at a resort destination or an adversarial meeting to criticize the pace of expanded access programs and negotiate lower prices, it all goes under the marketing budget.
It can be difficult to level criticism against pharmaceutical companies when your only point of contact is through a local representative. Drug reps are some of the nicest and most helpful people around; that's part of why they were hired. They provide an important conduit for channeling market information from the field to decision makers in the company and they bring life-giving grants and guidance to small non-profits. The clinical staff and researchers who work for big drug companies are usually great people, too. They are generally deeply dedicated to curing HIV/AIDS and often they have been personally affected by the epidemic. Yet these people are remote from the business strata of their companies, a world populated by individuals responsible for maximizing the profits of complex billion dollar enterprises. Practically speaking, the executives making multimillion-dollar salaries exist in an alien world; they don't necessarily share conventional humanitarian concerns, and it would be naive to expect them to.
Recently several news stories have thrown a spotlight on the public relations activities of the Pharmaceutical Research and Manufacturers of America, (PhRMA) the drug industry's trade group and Washington representative. PhRMA is one of the most effective -- and shameless -- industry trade groups to cross the Beltway. With $154 billion spent on prescription drugs in the U.S. last year, the group's influence with politicians and media rivals that of the defense industry. One tried and not-so-true tactic rolled out in the emerging fight against state Medicaid prior authorization plans is the creation or co-optation of legitimate-sounding grassroots consumer organizations that then are employed to influence politicians and produce sound bites for the media. These artificial grassroots groups are known as "astroturf" organizations.
The Baltimore Sun recently published a report about a fax campaign aimed at community leaders in Maryland. The fax was an urgent appeal from an organization called the Consumer Alliance. Recipients were urged to contact their state assembly members and demand free choice and affordable access to medicines for poor and disabled people. The campaign was actually organized by a Washington lobbying firm, Bonner & Associates, that specializes in generating ersatz grassroots outrage designed to sway impressionable politicians. Bonner's corporate clients select the issues and Bonner crafts the letters and chooses the targets. According to The Sun, "The fax, sent to dozens of community leaders, had the markings of a grassroots effort, including grammatical errors and a handwritten cover letter."
"This kind of politics is the most deceitful, underhanded brand of politics that can be practiced," Bishop Douglas I. Miles, pastor of Koinonia Baptist Church in Baltimore and one of those who received the fax told The Sun. The appeals, sent from a Washington office using Consumer Alliance letterhead, made no mention of the pharmaceutical industry, only of the need to protect "poor children, adults and seniors."
Jack Bonner, who directs the firm orchestrating the campaign, was not sympathetic to criticisms that hiding behind legitimate sounding community organizations to disseminate PhRMA positions was fraudulent. "Welcome to the big leagues," he told The Sun. "The more people and organizations that come forward on your behalf, the better off you are in politics."
On the prior authorization issue, the offensive is well under way. The Boston Globe quoted a PhRMA spokesperson on the group's plans to influence public opinion: "We will launch a grassroots education campaign, so they're aware of what the state's trying to do, before it's implemented."
As the rebellion against uncontrolled drug prices spreads to state legislatures throughout the country, look for a message from PhRMA in your fax machine soon.
|Pharma Phacts Industry Spending: Marketing vs. Profit vs. Research (% of Revenue)|
|Source: 2001 10K Reports -- SEC Edgar Online www.sec.gov.|
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