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November
1, 2006
Drug Cartel's Pre-Election Jitters
Panic
in Big Pharma
By PETER ROST, MD
Few recent elections have been as critical
for the drug industry as this one. And that's the reason The
Wall Street Journal reports that "Assailed by Democrats,
drug companies are pouring millions of dollars into close races,
giving some Republicans a financial edge."
What is at stake is a financial
windfall the size of which has never before been endowed on a
single industry, courtesy of the current administration. And
that windfall is coming from drugs for poor people.
By some estimates the windfall
for the drug industry could be $2 billion or more this year,
and it is the result of the transfer of millions of poor people
into the new Medicare Part D program. Under this program, the
prices paid by the taxpayer, for the medications given to those
unable to pay for drugs, are likely to be higher than what was
paid under the Medicaid programs.
This is a program embraced
by the current administration, and by the drug companies and
the insurance industry. They all work together. In fact, when
I was a Vice President at Pfizer, (an adventure you can read
about in my recent book, "The
Whistleblower, Confessions of a Healthcare Hitman")
I received a phone call from someone calling on behalf of the
CEO, requesting that I pay $2,000 for a fund raising dinner for
President Bush's reelection. So did many other employees, co-opted
into supporting an administration they couldn't stand.
The Democrats have seen less
money from the drug industry and House Democratic Leader Nancy
Pelosi, has said that within the first 100 hours of taking over
the House, she will help rewrite the prescription-drug benefit
to take away most of the advantages it handed to pharmaceutical
companies.
"It'll take five minutes"
to make the biggest change of all--the proposal to let the government
negotiate prices, Ms. Pelosi told a group of about 100 retirees
in Sunrise, Fla., earlier this month, according to the Wall Street
Journal. She said the benefit was a product of "corruption,
putting pharmaceutical companies and HMOs first at the expense
of America's seniors."
The Medicare Part D program,
which forbids the government from negotiating drug prices, was
initially such a mess that at least two dozen states had to take
emergency action to help low-income people who could not get
their medications under the program, which began Jan. 1. States
were spending millions of dollars a day in such assistance.
And the program isn't very
effective. Los Angeles Times claims that "a review by the
Senior Action Network, a grass-roots advocacy group in San Francisco,
found that Costco's prices on the top 100 drugs used by Medicare
beat prices of all 48 plans in California in more than half the
cases."
Meanwhile, "The net federal
cost of the new benefit is projected to be $37.4 billion in 2006
and $724 billion from 2006 to 2015.
But the program is good for
the drug companies, and the insurance industry. The Wall Street
Journal reports that the "early winners" include large
health insurers, who "have snagged roughly 15 million new
customers and healthy government subsidies" under the program.
The WSJ concludes, "By far, the biggest winner in the race
to sign up seniors is UnitedHealth Group Inc., which has used
an alliance with AARP to help it grab more than 3.9 million new
customers."
And one person who has won
more than anyone else is the former CEO of UnitedHealth, who
was recently terminated due to his backdated stock options. Earlier
this year those stock options were valued at $1.6 billion in
unrealized gains. He and in some years at least 10 other top
executives of the company frequently received options just before
big run-ups in the company's share price, which had the effect
of making the options more profitable than they otherwise would
have been.
Meanwhile, the White House
earlier this year conducted a dirty campaign to force seniors
into the fold. According to the Boston Globe, "Thousands
of Americans who order prescription drugs from Canada have received
written notice that their medications have been seized, part
of a US government crackdown on the cross-border discount trade."
The enforcement policy began
Nov. 17, two days after the enrollment period for the Medicare
program opened.
In conclusion, the current
administration has done what this administration does best. Funnel
money to already fabulously rich executives. And American taxpayers
do what they do best--pay the bill. Meanwhile, our poor and our
elderly are suffering. In fact, in a Washington Post-ABC poll
less than a third of respondents said they were saving a lot,
and 26% said they had seen no savings due to the Medicare Part
D program.
Perhaps that shouldn't be surprising,
considering that, according to U.S. Senator Herb Kohl, "those
with drug costs below $810 a year will actually pay more than
they do today if they sign up for the drug benefit. Seniors with
drug costs of $5,000 will still pay almost $4000 themselves--almost
80% of the bill."
Hopefully a Democratic Congress
can affect some of this.
But I'm a little bit too cynical
to think much will change; after all, in our nation the only
currency that talks is money.
Our democracy has been subverted
by the New Robber Barons into a pure kleptocracy, managed by
our sticky-fingered and unelected CEOs.
CounterPunch
Speakers Bureau Sick of sit-on-the-Fence speakers, tongue-tied and timid?
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