Political Atmosphere Prompts Scrutiny Of Pharmaceutical Industry
With "weak new productpipelines" and "sagging stock values," drug companies are"increasingly relying on the government for revenue," though thoseprospects could be dim as some congressional lawmakers are "gearing upinvestigations and hearings that could shed a harsh light" on theindustry's business practices, the Wall Street Journal reports.According to the Journal, the Medicare prescription drug benefit"increased the portion of retail prescription drug purchases paid for bygovernment sources to 34% last year, from 28% in 2005."
However, the "growing role" of government in the drug industry'sbusiness could make pharmaceutical companies "more vulnerable to shiftingpolitical winds," the Journal reports. For instance, the House Energy and Commerce Committee is looking into the marketing ofseveral drugs, including Vytorin, Lipitor, Procrit and Aranesp. In addition toscrutiny on Capitol Hill, many of the presidential candidates -- including thethree Democratic front-runners and Sen. John McCain (R-Ariz.) -- supportimporting less-expensive drugs from Canada, while the Democratic candidatesalso support allowing Medicare to negotiate drug prices with the industry.
Drug Industry Response
Pharmaceutical Research and Manufacturers ofAmerica CEO BillyTauzin said that "we've got a thick skin," adding that "we canhandle" attacks. Tauzin also said that PhRMA has formed a task force toconsider overhauls to industry marketing practices. He said, "We thinksome of the criticisms are valid and we ought to address them" (WildeMathews/Johnson, Wall Street Journal, 1/23).
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