E-DRUG: lobbying for Claritin patent extention
------------------------------------------------------------------
[copied from PHARM-POLICY with thanks; WB]
Pretty good reporting on lobbying efforts by Schering-Plough
on Claritin patent extention. Includes campaign cash, hiring
spouses of Senators, tickets to Baltimore Orioles, use of
the Schering-Plough corporate jet, and more. (Interesting
fact not mentioned, CEO of Schering-Plough was elected to
the Board of Directors of New York Times this year.)
Jamie
http://search.washingtonpost.com/wp-srv/WPlate/1999-10/30/169l-103099-idx.html
Patent Fight Tests Drug Firm's Clout
Claritin Maker Goes All Out in Congress
By Charles R. Babcock
Washington Post Staff Writer
Saturday, October 30, 1999; Page A01
Over the past few years, the blockbuster antihistamine Claritin
has become almost as ubiquitous as aspirin, used by millions of
American allergy sufferers.
But unlike with aspirin, only one company, New Jersey
pharmaceutical giant Schering-Plough Corp., gets the revenue from
Claritin sales, which totaled $1.9 billion last year.
Now, Congress faces a question with huge implications for both
Schering-Plough and drug consumers: Should Schering-Plough be
able to control Claritin and its profits for years into the
future, or should competition from cheaper generic versions be
allowed sooner?
For three years, the company has used a multimillion-dollar
lobbying campaign to try to get help from Congress in protecting
the Claritin patent beyond its 2002 expiration date.
The latest attempt is a bill that would let Schering-Plough and a
few other companies plead their case for three years of added
life before a special patent review board. The company just wants
a fair hearing, chief executive Richard Jay Kogan told a Senate
hearing in August.
[snip]
Rep. Henry A. Waxman (D-Calif.), an advocate for low-priced
generics, calls the proposal the "Claritin Monopoly Extension
Act." Its passage, he said, "would send a simple message that if
you spend enough money and hire the right lobbyists you can get a
law that harms consumers."
The importance to both sides is obvious from the intensity of the
fight. Since 1996, Schering-Plough has doubled its lobbying
spending to $4 million a year, adding several familiar faces to
woo Democratic support, including Peter Knight, a confidant of
Vice President Gore, and Linda Daschle, the wife of Senate
Minority Leader Thomas A. Daschle (D-S.D.).
The company has made other gestures large and small: a $1 million
donation to the foundation of supporter C. Everett Koop, the
former surgeon general; an outpouring of campaign donations; use
of its Gulfstream IV corporate jet by a key senator; and free
Baltimore Orioles tickets.
[snip]
For years, Schering-Plough had used the lobbying services of a
firm headed by former Senate majority leader Howard H. Baker Jr.
(R-Tenn.). But that year it began hiring what became an army of a
dozen other lobbying firms.
Its first tack was to persuade Sen. Arlen Specter (R-Pa.), an
Appropriations Committee member, to try to attach a two-year
Claritin patent extension to the Agriculture Department spending
bill. Such maneuvers are often used by members to slip in
controversial measures, but Specter's effort failed.
In early 1997, Schering-Plough's in-house lobbyist, Robert
Lively, began pushing the notion of a patent review board. The
approach would take "the issue out of politics," said company
spokesman William O'Donnell.
Opponents argued that Congress would merely be signaling its
endorsement, which would be hard for a review board to ignore.
To float the idea, the company turned to Sen. Fred D. Thompson
(R-Tenn.), whose state is home to two Schering-Plough facilities,
and then to home-state Sen. Robert G. Torricelli (D-N.J.). But
they stopped short of introducing legislation.
Claritin's U.S. sales in 1997 soared to $1.4 billion, helped by
an FDA decision to make it easier for drug companies to advertise
directly to consumers. Claritin's advertising campaign was
massive, costing nearly $200 million last year.
Last fall, Schering-Plough went to New Jersey's other senator,
Frank R. Lautenberg (D), who tried to attach the review board
provision to a late-session omnibus spending bill. A Lautenberg
spokesman said he helped because the company is important to New
Jersey's economy.
Public interest groups and lobbyists for the generics industry
again complained about stealth tactics. That was when Koop, a
respected voice on Capitol Hill, entered the picture.
Last Oct. 13, he wrote members, saying the proposed legislation
"merely creates a fair, open process." Still, the effort failed.
This year, Claritin's maker changed its approach again, pushing
for public debate on the issue. It persuaded Torricelli to
introduce a Senate bill--the day after Schering-Plough
contributed $50,000 to the Democratic Senate campaign committee
he chairs. The timing was a coincidence, a company
spokesman and a Torricelli aide said.
In the House, Reps. Edward G. Bryant (R-Tenn.) and Jim McDermott
(D-Wash.) co-sponsored a Schering-Plough bill. The next day, Koop
sent another letter to members praising the measure.
Meanwhile, Schering-Plough also shifted its political giving.
Historically, the firm's political action committee (PAC) favored
Republicans. This year through June, more than half its donations
flowed to Democrats. A similar change occurred in its "soft
money"--corporate donations to political parties.
McDermott's support shocked consumer groups, which consider him
an ally. A psychiatrist, he supports national health insurance
and has advocated cheaper drugs for seniors. Schering-Plough's
PAC has donated to McDermott's campaigns for years and lobbyist
Lively has supplied the House member with Baltimore Orioles
tickets as an in-kind political contribution.
David Schaefer, a spokesman for McDermott, said McDermott
believes allowing a patent hearing is better than trying to sneak
extensions into bills "in the middle of the night." McDermott
considers Schering-Plough a "good corporate citizen," the
spokesman added. In the early 1990s, it supplied him
with antibiotics on overseas health care missions.
Schaefer said McDermott was miffed when one segment of the
generic drugs industry got personal. It sponsored attack radio
ads in McDermott's district, asking constituents to send in $1
bills to "Buy Jim Back" by matching $7,000 in Schering-Plough
donations.
The tension between the sides was also in evidence June 10, in a
Capitol basement hallway. C. McClain Haddow, a lobbyist for
generics maker Mylan Laboratories, needled former surgeon general
Koop as he waited to talk about "fairness in drug patenting."
"Come on, Chick! You can't tell me Schering isn't helping you out
on one of your programs," Haddow recalled telling Koop. Later, he
learned about Schering-Plough's $1 million donation to Koop's
foundation. The company and a Koop aide said the gift was not
related to his advocacy.
In July, Sen. Orrin G. Hatch (R-Utah) scheduled a hearing on the
Torricelli bill. He had just announced a presidential bid, and
asked Schering-Plough for the use of its Gulfstream executive jet
for campaign travel, according to spokesman Jeff Flint.
Federal campaign rules allow a candidate to use a corporate jet
for the price of a first-class airline ticket, which is less than
it costs the company to operate the plane.
O'Donnell said Schering-Plough historically has made its aircraft
available to members of Congress "on a very limited basis."
Hatch's spending report shows he has paid for use of the
drugmaker's jet five times. One payment was made the day after
the hearing, for what Flint said was a trip to Iowa.
O'Donnell and Flint both said Hatch's use of the plane had
nothing to do with his decision to hold the hearing.
[snip]
Staff researcher Alice Crites contributed to this report.
JUMP INFORMATION APPENDED FROM FILE
Schering-Plough's Political Voice in Washington 1996-1999
Lobbying -- Schering-Plough spent less than $2 million on
lobbying in 1996, the year it first tried to get a patent
extension for Claritin. It doubled its lobbying expenditures to
more than $4 million last year, and spent another $2.2 million in
the first six months of this year. The firm of former Senate
majority leader Howard Baker (R-Tenn.) has represented
Schering-Plough for years, but the company has added a dozen
other lobbying firms to its roster since mid-1996.
Campaign donations -- Though Schering-Plough, like many
corporations, has historically given the majority of its
political action committee (PAC) and unlimited "soft money"
donations to Republican candidates and committees, its recent
giving has matched its effort to get bipartisan support for the
patent extension. In the 1996 and 1998 election cycles,
three-fourths of its PAC donations went to Republicans; in the
first six months of this year, 61 percent went to Democrats,
according to Public Disclosure Inc.
In the 1996 cycle, 96 percent of Schering-Plough's $395,000 in
corporate donations went to the GOP. So far this year, only about
60 percent of its $242,000 in soft money has gone to Republican
party committees.
Charity donations -- Former surgeon general C. Everett Koop has
backed Schering-Plough's position on the patent extension bill in
letters and meetings over the past year. The company made a $1
million donation to Koop's personal foundation and advertises on
his popular health care Internet site.
Corporate plane -- The company made its Gulfstream IV executive
jet available to the exploratory presidential campaign of Sen.
Orrin Hatch (R-Utah) starting in July, the same month Hatch
agreed to hold a hearing on a bill that would set up a procedure
where the company could argue for added patent life for Claritin.
--
James Love / Director, Consumer Project on Technology
http://www.cptech.org / love@cptech.org
P.O. Box 19367, Washington, DC 20036
voice 202.387.8030 / fax 202.234.5176
--
Send mail for the `E-Drug' conference to `e-drug@usa.healthnet.org'.
Mail administrative requests to `majordomo@usa.healthnet.org'.
For additional assistance, send mail to: `owner-e-drug@usa.healthnet.org'.