Drug industry boosts lobbying amid growing scrutiny of prices

The pharmaceutical industry’s top trade group increased its lobbying spending in 2015 amid intensifying scrutiny of drug prices. 

The Pharmaceutical Research and Manufacturers of America (PhRMA) spent $18.32 million on lobbying in 2015, up from $16.51 million in 2014, according to disclosure records. 

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Last year was the first year that PhRMA’s lobbying spending rose since 2009, according to data from the Center for Responsive Politics. 

The increase came in a year when drug companies faced outcry over rising prices. Martin Shkreli, the hedge fund manager who increased the price of a drug to treat life-threatening infections from $13.50 to $750 overnight, has become the poster boy for the issue. 

Congress subpoenaed Shkreli on Wednesday, and the Senate Aging Committee has opened a bipartisan investigation into the broader issue of price hikes for drugs with expired patents. 

PhRMA has done its best to distance itself from Shkreli, pointing out that his company, Turing Pharmaceuticals, is not a member of the organization. The group's CEO, Stephen Ubl, wrote last month that Turing and another company in the spotlight, Valeant Pharmaceuticals, are “essentially hedge funds masquerading as pharmaceutical companies,” in contrast to the focus on research and development by most of the industry.  

Still, the attention on drug prices is wider. 

More than 50 Democratic lawmakers wrote to the Obama administration earlier this month suggesting that it should consider using its power under a 1980 law to lift the exclusive rights awarded to drug companies if they are unfairly pricing their products. 

In December, the bipartisan duo of Sens. Ron Wyden (D-Ore.) and Chuck Grassley (R-Iowa) took the drug company Gilead Sciences to task for charging $84,000 for a course of its hepatitis C drug, Sovaldi.  

Democratic presidential candidates Hillary Clinton and Bernie Sanders have been pounding drug companies on the campaign trail and calling for policy moves strongly opposed by PhRMA, such as allowing Medicare to negotiate drug prices or allowing imported drugs from Canada. 

Republicans still largely oppose those changes, so major policy action remains unlikely in Congress in 2016. 

The Obama administration, however, has been exploring the possibility of taking some actions on its own. 

The Department of Health and Human Services held a forum in November on drug prices, raising the possibility of new value-based payment models for Medicare and Medicaid that would pay for a drug based on how effective it is shown to be.  The administration has also taken steps to increase transparency, launching an online “dashboard” to show the price of certain high-cost drugs. 

While drug spending increased by 12.2 percent in 2014, PhRMA emphasized that spending on prescription drugs remained only around 10 percent of healthcare spending overall.