Drug companies going on defense

WASHINGTON -- Alarmed at the prospect of Democratic control of Congress, top executives from two dozen drug companies met last week to assess what appears to them to be a harsh new political climate, and to draft a battle plan.

Hoping to prevent Congress from letting the government negotiate lower drug prices for millions of older Americans on Medicare, the pharmaceutical companies have been recruiting Democratic lobbyists, lining up allies in the Bush administration and Congress, and renewing ties with organizations of patients who depend on brand-name drugs.

Many drug company lobbyists concede that the House is likely to pass a bill aimed at driving down drug prices, but they are determined to block such legislation in the Senate. If that strategy fails, they are counting on President Bush to veto any bill that passes. With 49 Republicans in the Senate next year, the industry is confident that it can round up the 34 votes normally needed to uphold a veto.

While that showdown is a long way off, the drug companies are not wasting time: They began developing strategy last week at a meeting of the board of the Pharmaceutical Research and Manufacturers of America.

Billy Tauzin, president of that group, a lobbying organization for brand-name drug companies, recently urged Rep. Edolphus Towns, D-N.Y., to seek a position as chairman of a powerful House subcommittee. The subcommittee has authority over Medicare and the Food and Drug Administration. Democrats have yet to decide who will head the subcommittee.

Tauzin, a former congressman, also met with Sen. Byron L. Dorgan, a North Dakota Democrat who has been trying for six years to allow drug imports from Canada. The industry vehemently opposes such legislation.

James C. Greenwood, president of the Biotechnology Industry Organization, another trade group, said, "There is a lot of pent-up animosity among Democrats against the pharmaceutical industry." Greenwood, a former Republican congressman from Pennsylvania, said he had a list of 37 congressional Democrats whom he intended to call in the next month.

Amgen, the biotechnology company, recently disclosed that it had retained as a lobbyist George C. Crawford, a former chief of staff for Rep. Nancy Pelosi of California. Pelosi, the House Democratic leader, is in line to become speaker in January and has said that the House will immediately take up legislation authorizing Medicare to negotiate prices with drug manufacturers.

The 2003 Medicare law prohibits the federal government from negotiating drug prices or establishing a list of preferred drugs.

At a dinner last week, as part of their board meeting, pharmaceutical executives dissected the midterm election results with experts including Ed Goeas, a Republican pollster, and Stuart Rothenberg, the editor of a political newsletter.

Drug makers have not set a budget for their campaign. They and their trade groups already spend $100 million a year on lobbying in Washington.

"We and our allies will do everything we can to defend the Medicare drug benefit," Tauzin said in an interview after the board meeting.

To reinforce that message, drug companies plan to mobilize beneficiaries and urge them to contact Congress.

"I'm putting my trust in beneficiaries," said Tauzin, who represented Louisiana in the House for more than two decades, first as a Democrat and then as a Republican. Several recent surveys suggest that at least three-fourths of the people with Medicare drug coverage are satisfied.

But Rep. Frank Pallone Jr., Democrat of New Jersey, who hopes to head the health subcommittee of the Energy and Commerce Committee, said price negotiations for Medicare were his No. 1 priority.