Over the last year, the prescription drug industry has buffeted Americans with wave after wave of deceptive advertising, part of a sophisticated campaign to protect the firms' multi-billion-dollar profits. The drug lobby's goal is single-minded: avoid any kind of Medicare drug coverage that reins in skyrocketing drug costs. The campaign's effect so far has been to deny America's senior citizens and people with disabilities a Medicare prescription drug benefit.
To carry out this campaign, the drug companies' regular lobby, the Pharmaceutical Research and Manufacturers of America (PhRMA), created the innocuous-sounding Citizens for Better Medicare (CBM) to serve as its front group. Through CBM, they have budgeted at least $65 million for television advertising since July 1999. This air battle has been supplemented with radio, print and Internet ads, along with direct mail appeals from CBM and its member groups.
In looking at CBM's advertising and the drug industry's lobby disclosure reports, it's clear that the pharmaceutical giants prefer the safety of the status quo and support very little in the way of reform. Two main pieces of legislation are drawing their fire. One is the Clinton prescription drug proposal, which would add a new benefit under Medicare, rather than rely on private insurance companies and HMOs to provide coverage. Industry leaders say a federal benefit will lead to cost-cutting efforts that will cut into their profit margins.
The other bill that the drug lobby opposes is the Prescription Drug Fairness for Seniors Act (H.R. 664/S. 731, also known as the Allen bill for its House sponsor, Rep. Tom Allen, D-Maine). The bill would require drug companies to give deep discounts to local pharmacies for prescriptions that the pharmacies sell to Medicare beneficiaries. The resulting savings for Medicare beneficiaries would be about 40-50 percent, which is about what large purchasers like the Departments of Defense and Veterans Affairs save. It is also close to the amount that individual seniors can save by buying their drugs in Canada.
In CBM's television ads, Americans were first introduced to "Flo," a skeptical senior often spotted with her friends at the bowling alley. She repeatedly tried to scare seniors with the specter of a "big government" program. The drug industry tapped a real Willy Wonka character to play "Flo." The actress, Diana Sowle, played Charlie Bucket's mother in "Willy Wonka and the Chocolate Factory." But no amount of acting or magical television trickery can turn Citizens for Better Medicare into a grassroots organization representing seniors.
Public Citizen researched CBM's self-described "broad-based bipartisan group" and found a collection of shills, seedy direct-mail operatives and industry-funded research and lobby groups working in tight coordination with the drug lobby. Among this report's findings:
CBM's campaign has seen four major waves, each precisely calibrated to attack supporters of common sense reform. After President Clinton announced his prescription drug plan in June 1999, the issue of drug prices saw a flurry of media attention. On July 15, drug industry leaders met to coordinate a $30 million advertising buy, and "Flo" was born later that month. In the summer and fall, many members of Congress released studies on price discrimination in their districts, showing how seniors without prescription drug coverage were being price gouged by drug companies. The drug industry responded with a $1.5 million barrage of television, radio, print and Internet banner ads in Oregon, Minnesota, Iowa and Colorado. They targeted vulnerable House Democrats and accused them of "playing politics" with the issue. These ads were followed up with direct mail from the Seniors Coalition. In addition, CBM ran ads supporting one of the industry's chief Democratic champions on Capitol Hill, Rep. Cal Dooley of California, who had a primary fight.
In January 2000, the Clinton administration, tired of the onslaught, threatened to slam the industry in the President's final State of the Union address. The drug industry launched a new, friendlier set of ads, with Flo expressing optimism that Washington could make progress toward a prescription drug benefit. President Clinton went easy on the industry in his January 27 speech, and the drug firms' stock prices got a boost from a relieved Wall Street.
The truce, however, was a sham. The drug industry kept its coalition of shills on task to produce a bevy of studies that cast doubt on the need to reduce drug prices as part of a Medicare proposal. By March, in response to many news reports of bus trips to Canada to buy drugs at a deep discount, CBM responded with new ads that slammed the Canadian health system and attempted to scare seniors with the specter of rationing and supposed threats to research. They also began running ads attacking Montana's Democratic Senate candidate Brian Schweitzer, who led a widely reported bus trip to Canada.
Ironically, by June of 2000, the drug industry has come so far that it has begun to co-opt its opponents' most effective message. In full-page ads around the country, PhRMA is touting a study saying that drug prices can be cut 30-40 percent under a private insurance scheme. This is clearly an attempt to steal the Allen bill's thunder and undermine support for allowing Medicare to negotiate lower drug prices.
Despite the numerous changes of strategy and message one thing has remained consistent about the Citizens for Better Medicare campaign: the drug industry will do whatever it takes — tell lies, distort and spend gobs of money — to block a Medicare drug program that does the one thing necessary to make it affordable — rein in skyrocketing drug costs.