Schering-Plough Political Money Pushes Claritin Patent Extension

Since pharmaceutical maker Schering-Plough began trying in 1996 to persuade Congress to extend the company's patent on the multibillion-dollar allergy drug Claritin, it has dramatically increased its soft money contributions and lobbying expenditures and is increasingly courting Democrats with both campaign cash and lobbying.

Schering-Plough's current vehicles are S. 1172 and H.R. 1598, which would allow three-year patent extensions for Claritin and six other "pipeline" drugs, so-called because they were in the FDA review process at the time the 1984 Hatch-Waxman Act became law. Such an extension for Claritin alone would cost consumers an extra $7.3 billion. Extensions for all seven drugs would cost an extra $11 billion. [July 1999 Study by Prof. Steven Schondelmeyer, University of Minnesota PRIME Institute]

In the closing days of this year's Congressional session, Schering-Plough's high-priced campaign has catapulted S. 1172, sponsored by Sen. Robert Torricelli (D-N.J.) and backed by Senate Judiciary Committee Chairman Orrin Hatch (R-Utah), onto the Senate Judiciary mark-up calendar for November 10, 1999.

Findings

Soft Money

  • Over the past three election cycles, Schering-Plough has given nearly $1 million in soft money to Democratic and Republican party committees. This year, the company's soft money contributions through September 1999 total $292,000 -- four-and-a-half times greater than what the company contributed in the comparable period during the previous two election cycles ($75,000 in 1995 and $65,000 in 1997). [Table 1]

  • Soft money contributions to Democratic Party committees represented only 4 percent of total soft money giving in the 1996 cycle, but jumped to 23 percent in the 1998 cycle and 34 percent thus far in 1999. Democratic Party committees raised more from Schering-Plough in the first nine months of 1999 ($100,000) than they raised in all of 1995 to 1998 combined ($81,000). [Table 1]

PAC Candidate Contributions

  • Schering-Plough's campaign contributions to candidates show the same trend. Since 1996, Schering-Plough's corporate PAC has contributed $371,500 to members of Congress -- $264,000 to Republicans and $107,500 to Democrats. In the 1996 and 1998 election cycles, the ratio was 3-to-1 Republican over Democrat. In the first six months of 1999, 61 percent went to Democrats and 39 percent to Republicans. [Table 2]

Contributions to Senate Judiciary Committee Members

  • The seven current and former members of the Senate Judiciary Committee who are co-sponsors of the patent extension legislation, S. 1172, or have otherwise assisted Schering-Plough's effort to gain a Claritin patent extension, collectively received $74,998 in campaign contributions over the past three election cycles. This is 17 times more than the company's contributions of just $4,300 to all of the committee's other 16 members over the same period. [Table 3 and Figure 1]

  • A main proponent of the Claritin patent extension bill in the Senate (S. 1172) is the bill's chief sponsor, Sen. Robert Torricelli (D-N.J.). Over the past three election cycles, Torricelli was the lead recipient of contributions from the corporation's PAC and executives, receiving $31,050. Torricelli was also vice chairman [1998] and chairman [1999] of the Democratic Senatorial Campaign Committee, which received $115,000 from Schering-Plough over the past two election cycles. [Table 3 and Table 1]

  • Senate Judiciary Committee Chairman Orrin Hatch (R-Utah) was the Judiciary Committee's second-highest recipient of Schering-Plough PAC and corporate executive contributions, taking in $16,000 [including $5,000 to his current presidential campaign]. [Table 3]

  • Hatch also has used Schering-Plough's corporate jet on at least five occasions in July and August of this year within days of the Judiciary Committee's hearing on S. 1172 at which he spoke in support of the legislation. [The Iowa Republican straw poll took place August 14, 1999. While neither the FEC nor the Hatch campaign have disclosed the exact number of flights or the destination, the Washington Post reported on October 30, 1999 that at least one of the flights was to Iowa.] Hatch reimbursed the company a total of $18,961 in five separate payments, which represents the price of a first-class air ticket for each passenger. These payments cover just a small fraction of the actual cost of operating Schering-Plough's corporate jet, a Gulfstream 4, which would cost $5,000/hour to charter. A charter service operating at Reagan National Airport quotes a price of $30,000 to fly 2-3 people round-trip from Washington to Des Moines. [Table 4]

Lobbying Expenditures

  • Since 1996, Schering-Plough has spent more than $11 million lobbying Congress and the administration. The company's lobbying expenditures have risen rapidly, doubling between 1996 and 1998 (rising from $1.9 million to $4.3 million) and increasing by almost a third in the first half of 1999 compared to the same period a year earlier. [Figure 2]

  • In the second half of 1998 and the first six months of 1999, the company added such prominent Democratic lobbyists as former Watergate Chief Counsel Richard Ben-Veniste; Peter Knight a close confidant and chief fundraiser for Vice-President Gore; and Linda Daschle, wife of Senate Minority Leader Tom Daschle [to lobby the House not the Senate]. They join longtime Republican power broker lobbyists for Schering-Plough such as former Sen. Majority Leader Howard Baker (R-Tenn.).

Chronology of Legislative Events/Soft Money Contributions

  • A chronology of key legislative events on the Claritin patent extension effort and notable soft money contributions by Schering-Plough is attached. [Table 5]

Table 1: Schering-Plough Corporation's Soft Money Contributions to Party Committees

Democratic Committees Republican Committees Percent
D : R
1999-2000 $100,000 1999-2000 $192,000 34% : 66%
5/28/99
5/26/99
3/25/99
DCCC
DSCC
DCCC
$25,000
$50,000
$25,000
9/15/99
6/3/99
5/5/99
3/31/99
3/22/99
3/10/99
NRSC
Dinner*
RNC
RNC
NRCC
NRCC
$50,000
$20,000
$15,000
$2,000
$100,000
$5,000
1997-1998 $66,000 1997-1998 $220,000 23% : 77%
11/3/98
3/12/98
5/19/97
DNC
DSCC
DSCC
$1,000
$50,000
$15,000
10/9/98
9/30/98
9/17/98
3/11/98
6/11/97
5/21/97
5/15/97
NRCC
NRSC
NRCC
RNC
Dinner*
RNC
RNC
$5,000
$50,000
$100,000
$15,000
$20,000
$15,000
$15,000
1995-1996 $15,000 1995-1996 $380,685 4% : 96%
6/19/96 DSCC $15,000 10/25/96
9/20/96
9/17/96
8/28/96
8/7/96
7/19/96
7/15/96
6/28/96
6/27/96
6/26/96
6/6/96
6/5/96
11/6/95
5/24/95
3/15/95
3/1/95
NRSC
RNC
NRCC
RNC
NRSC
Dinner*
NRSC
RNC
NRSC
Dinner*
RNC
NRSC
NRSC
RNC
Dinner*
NRCC
$50,000
$100
$100,000
$15,000
$585
$10,000
$5,000
$3,000
$2,000
$10,000
$100,000
$10,000
$25,000
$15,000
$20,000
$15,000
Totals $181,000 $792,685 19% : 81%

* Dinner is for the National Republican Senate-House Dinner Committee, an annual, joint event to raise funds for the NRCC and NRSC.
Source: Figures compiled by Public Citizen from Common Cause (www.commoncause.org) data.

Table 2: Schering-Plough's PAC Contributions to Congressional Candidates

Election Cycle

Total

Democrats

Republicans

2000* $59,5000 $36,500 61% $23,000 39%
1998 $169,500 $39,000 23% $130,500 77%
1996 $142,500 $32,000 22% $110,500 78%
Total $371,500 $107,500 29% $264,000 71%

* Six-months of 1999.
Source: Public Disclosure, Inc. (www.tray.com).

Table 3: Contributions to U.S. Senate Judiciary Committee Members by Schering-Plough's PAC or Executive Employees
January 1, 1995 - June 30, 1999

Senator Party Amount

Position on Claritin
Patent Extension

Congressional
Terms on this
Committee
Torricelli
Hatch
Thompson
Sessions
Specter
Ashcroft
Thurmond
D
R
R
R
R
R
R
$30,050
$18,000
$10,500
$10,448
$6,000
$0
$0
lead sponsor of S. 1172
publicly endorsed S. 1172
sponsor of 1997 attempt
co-sponsor of S. 1172
sponsor of 1996 attempt
co-sponsor of S. 1172
co-sponsor of S. 1172
106th
104th-106th
104th-105th
105th-106th
104th-106th
105th-106th
104th-106th
Total $74,998
DeWine
Abraham
Simpson
Smith
Biden
Brown
Durbin
Feingold
Feinstein
Heflin
Kennedy
Kohl
Kyl
Leahy
Schumer
Simon
R
R
R
R
D
R
D
D
D
D
D
D
R
D
D
D
$2,000
$1,000
$1,000
$300
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
not a co-sponsor
not a co-sponsor
not a co-sponsor
not a co-sponsor
not a co-sponsor
not a co-sponsor
not a co-sponsor
not a co-sponsor
not a co-sponsor
not a co-sponsor
not a co-sponsor
not a co-sponsor
not a co-sponsor
not a co-sponsor
not a co-sponsor
not a co-sponsor
104th-106th
104th-106th
104th
106th
105th-106th
104th
105th
104th-106th
104th-106th
104th
104th-106th
104th-106th
104th-106th
104th-106th
106th
104th
Total $4,300

Source: Figures compiled by Public Citizen from Public Disclosure, Inc. (www.tray.com) data.

Figure 1: Total Donations to Senate Judiciary Committee Members Who Have Supported Claritin Patent Legislation vs. Those Committee Members Who Have Not
(January 1, 1995 - June 30, 1999)

wpeF.gif (5430 bytes)

Source: Figures compiled by Public Citizen from Public Disclosure, Inc. (www.tray.com) data.

Table 4: Orrin Hatch Presidential Exploratory Committee Reimbursements to Schering-Plough for Use of Corporate Jet

Date

Amount

July 22, 1999

$1398.00

July 30, 1999

$2426.00

August 5, 1999

$1254.00

August 21, 1999

$1580.00

August 21, 1999

$12,303.50

Total

$18,961.50

Source: Federal Election Commission.

Figure 2: Schering-Plough Lobbying Expenditures
1996-1998
(Millions of Dollars)

wpe1.gif (5496 bytes)

Source: Figures compiled by Public Citizen from lobby disclosure forms filed at the Clerk of the House of Representatives.

Table 5: Legislative Events on Claritin Patent Extension and Notable Soft Money Contributions by Schering-Plough as of
November 9, 1999

Spring 1996
Schering-Plough's appeal to Congress began in the spring of 1996, not long after Searle & Co. received a patent extension for its arthritis drug.

Summer 1996
S
en. Arlen Specter (R-Penn.) tries unsuccessfully to attach two-year Claritin patent extension to the Agriculture Department appropriations bill.

1995-1996
Schering-Plough gives a total of only $15,000 in soft money to Democratic Party committees while giving $380,685 to Republican Party committees.

June 6, 1996
Schering-Plough contributes $100,000 in soft money to the RNC.

September 17, 1996
$100,000 in soft money to the NRCC.

October 25, 1996
$50,000 in soft money to the NRSC.


Early 1997

Schering-Plough begins to court Senators to support legislation to create a stacked-deck patent review process for Claritin and 6 other pipeline drugs.

May 1998
Rep. Ed Bryant's (R-Tenn.) effort to insert Claritin patent extension proposal into unrelated patent legislation in House Judiciary Subcommittee on Courts and Intellectual Property fails.

October 1998
Sen. Frank Lautenberg (D-N.J.) tries to attach Claritin's pipeline drug proposal to omnibus appropriations bill.

1997-1998
Schering-Plough gives a total of $66,000 in soft money to Democratic Party committees and $220,000 to Republican Party committees.

March 12, 1998
$50,000 in soft money to the DSCC, which was vice-chaired by Sen. Robert Torricelli (D-N.J.).


September 17, 1998

$100,000 in soft money to the NRCC.

September 30, 1998
$50,000 in soft money to the NRSC.


April 28, 1999

Rep. Bryant introduces Claritin's pipeline drug patent proposal [H.R. 1598].

May 27, 1999
Sen. Torricelli introduces Claritin's pipeline drug patent proposal
[S. 1172].

July 1, 1999
House hearing held on H.R. 1598 in the House Judiciary Subcommittee on Courts and Intellectual Property.

August 4, 1999
Sen. Hatch, chair of the Judiciary Committee, holds hearing on S. 1172.


November 4, 1999
Sen. Torricelli raises prospect of amending S. 1172 into unrelated legislation during Senate Judiciary Committee mark up.

November 10, 1999
Sen. Hatch schedules Senate Judiciary Committee mark-up of S. 1172.

1999-2000
Schering-Plough gives a total of $100,000 in soft money to Democratic Party committees and $192,000 to Republican Party committees (as of September 1999).

March 22, 1999
$100,000 in soft money to the NRSC.

March 25, 1999
$25,000 in soft money to the DCCC.

May 26, 1999
$50,000 in soft money to the DSCC, which is chaired by Sen. Torricelli.

May 28, 1999
Another $25,000 to the DCCC brings Schering-Plough's soft money donations to the Democrats to $100,000 for 1999. In just the first nine months of 1999, Claritin's makers have given more than the total it gave to Democrats in the preceding four years.

July 22 - August 21, 1999
Sen. Orrin Hatch's (R-Utah) campaign committee for the presidency makes five reimbursements totaling $18,961.50 to Schering-Plough for use of its corporate jet. At least one trip was to Iowa where a Republican Party straw poll for the presidency was held on August 14.

September 15, 1999
$50,000 in soft money to the NRSC.