The Wonk Room

PhRMA’s Compromise: Subsidize Our Over-Priced Products And Provide Us With More Customers

Families USA and the Pharmaceutical Research and Manufacturers of America (PhRMA) are joining forces to launch a multi-million lobbying campaign to convince Congress to increase Medicaid eligibility to 133% of the federal poverty level, offer income-adjusted subsidies, prevent insurers in the individual market for denying coverage to Americans with pre-existing conditions, and cap out-of-pocket expenses.

PhRMA may be exploiting the coalition to curry favor with the public and fend-off proposals for a new public health care plan, but proposals that expand affordable coverage to the neediest Americans should not be vetoed just because they bolster the profits of private industry. In fact, as Families USA President Ron Pollack pointed out during a recent interview with ThinkProgress, having industry stakeholders “engage in a way that is designed to enable… [reform] to take place in a way that fits their business model, but yet helps people who are currently shut out of the healtchare system — I think that’s a step in the right direction.”

The direction may be right but it’s unclear how this early cooperation bodes for comprehensive health care reform. In fact, Big Pharma, like the insurance industry, is willing to support government intervention that bolsters its bottom line. In this case, rather than lowering drug prices — in fact, “the prices of a dozen top-selling drugs increased by double digits in the first quarter from a year earlier” and Americans are still paying some of the highest prices in the world — the industry is urging the government to subsidize PhRMA products for Americans who can’t otherwise afford them.

It’s a sweet deal for the industry and lower-income Americans, but it doesn’t exactly demonstrate the stakeholder’s commitment to “shared responsibility.”