Drug Companies Employ "Astroturf Lobbying" in the States

A furious battle is being fought in state legislatures between advocates for lower prescription drug prices and drug manufacturers. And in many states, the drug companies are fighting dirty.

According to an ethics complaint filed in Maryland, PhRMA, the drug industry trade association, has "employed blatantly deceptive tactics – in the guise of a consumer-based organization – to do the bidding of the pharmaceutical industry." The drug industry has used similar tactics to battle legislation in Florida, Georgia, Indiana, Minnesota, New Mexico, North Carolina, Virginia and Washington state. In 2002, more than 20 states have considered legislation to lower the cost of prescription drugs purchased through the Medicaid system. Drug prices are busting Medicaid budgets, threatening substantial cuts in health benefits for the poor.

The battle is over legislation that pressures manufacturers to negotiate supplemental drug rebates with the states, the same way the manufacturers currently negotiate with insurance companies, HMOs and the federal government. Much of this legislation is based on CPA’s policy model. The drug companies favor the current federally-established rebates and want to avoid price competition with each other. So PhRMA is lobbying furiously in every state to defend their lucrative drug pricing system.

But instead of making its arguments in a straightforward manner, PhRMA has hidden behind front groups that pretend to have grassroots support. The effort is coordinated by Bonner & Associates, a Washington, DC-based PR firm hired by the drug industry to drum up opposition to the prescription drug legislation using a tactic known as "Astroturf lobbying."

Here’s how it works: Telemarketers at the Bonner & Associates office call individuals and local organizations within a state, posing as a group that safeguards consumers or seniors, or Medicaid patients. These telemarketers ask residents to sign a resolution or call state lawmakers, using an appeal that sounds like it comes from advocates for the poor. But it is actually an attack on the prescription drug legislation opposed by PhRMA.

Most often, Bonner telemarketers have impersonated "The Consumer Alliance," an organization with one employee whose office is located within Bonner & Associates. Using the Consumer Alliance name, Bonner set up a February 13 press conference of a small number of doctors in Tallahassee, as well as a larger press conference on March 5 in Atlanta.

Bonner telemarketers have called New Mexico and Minnesota residents under the name of the 60 Plus Association, urging them to ask their governors to veto prescription drug pricing legislation. What the Bonner employees don’t mention is that the 60 Plus Association is an extreme right-wing group in Northern Virginia. The drug industry also hired a different PR firm to lobby against similar legislation under the name of the "Maryland Partnership for Quality Healthcare."

"It really is revolting to me," said Adam Searing, project director of the North Carolina Health Access Coalition, an advocacy group for the poor. "I deal with the tactics of big business all the time. But to pretend to care about the poor when you just care about lining your own pockets I think is just deceitful."

Drug prices are busting Medicaid budgets, threatening substantial cuts in health benefits to the poor.

PhRMA’s tactics were successful in killing a far-reaching prescription drug discount proposal in Washington state. But legislation for supplemental Medicaid drug rebates passed over industry objections in Kentucky, Minnesota, Mississippi, New Mexico and West Virginia. These states join Florida, Louisiana and Michigan, which enacted similar laws last year, as well as California, which has received such rebates for years.

See the related article "Unmasking Drug Company Front Groups" in this newsletter.