Posted At PE.com
BY : Paul Elias
Even in defeat, the pharmaceutical industry's $80 million no-holds-barred campaign scored a big victory in the ballot-box battle over prescription drug discounts.
Although voters on Tuesday rejected the industry's own discount drug proposal, Proposition 78, they also turned back Proposition 79, a more liberal initiative.
The latter measure, supported by organized labor and consumer groups, would have coerced pharmaceutical companies to steeply discount prescription drugs for some 10 million Californians without health insurance.Proposition 78 would have made such a discount program voluntary.
Pre-election polls indicated the competing measures left many voters confused.
"Defeating Proposition 79 was the top priority for the drug companies," said Jack Pitney, a political science professor at Claremont McKenna College. "If voters got confused that probably suited the pharmaceutical industry."
With 88 percent of precincts reporting, Proposition 79 lost 61 percent to 39 percent. The drug industry-sponsored Proposition 78 also lost, 58 percent to 42 percent, with 88 percent of precincts reporting.
Fronted by its powerful Washington-based lobbying outfit, the Pharmaceutical Research and Manufacturers of America, the drug industry spent $50 million on a statewide media blitz and another $13 million on glossy mailers and other campaign literature in an effort to defeat Proposition 79. The measure would have required companies to give steep discounts to uninsured Californians if they wanted to participate in the state's Medi-Cal program, which provides about $4 billion in drugs annually to poor and elderly people.
The lobbying group, also known as PHrMA, said Proposition 79 would have punished the poor patients served by Medi-Cal by making it harder for them to get drugs from companies that refused to participate in the discount program.
"We were confident voters saw it was a flawed policy," said PHrMA spokeswoman Denise Davis. "We're pleased with the fact that voters recognized that Proposition 79 would hurt poor people and would not help uninsured Californians have access to affordable lifesaving medicine."
Drug titans Johnson & Johnson, Pfizer, Merck and GlaxoSmithKline each contributed $9.8 million.
It was money that helped pay for several high-profile political consultants, including former Assembly Speaker and San Francisco Mayor Willie Brown, as well as for glossy mass mailers that became controversial in the days before Tuesday's election. One flier targeting black California voters pictured 12 prominent black lawmakers next to an endorsement of Proposition 78, which some of them strongly opposed.
Proposition 79's backers were badly outspent, raising about $2 million for their campaign.
"In order to defeat, the companies had to spend a record-breaking $80 million and resort to dirty tricks," said Anthony Wright, who led the Proposition 79 campaign. "However, the voters rejected the drug companies' attempt to buy this election, including their attempts to prevent future price reforms."
Both sides vowed to renew their battles in the Legislature.
"We pledge to work with the governor, state lawmakers and state government officials to make sure uninsured low-income Californians have access to affordable lifesaving medication," said PhRMA spokeswoman Davis.
Wright said that "by sponsoring their own measure, drug companies have admitted that drug prices are too high."
Analysts said the bare-knuckles campaign underscored just how concerned pharmaceutical companies were that other states would follow California's example, forcing them to discount drugs for millions of uninsured residents.
Proposition 79 also would have punished drug makers who refused to give discounts by removing them from a lucrative government list of drugs that doctors can prescribe Medi-Cal patients without receiving approval. Additionally, the measure provided for individuals to sue drug companies if they believed the companies engaged in illegal profiteering, a provision the industry said would open it to a wave of lawsuits.
