When President Obama took office, pharma had already been hard at work lobbying for their point of view on healthcare reform. After all, the new president had said repeatedly that reforming healthcare was his top priority. The trade group PhRMA, the association of generics makers, BIO, and individual companies spent millions on campaign contributions--and later, lobbyists and their expense--to get the message across.
Well, by summertime it looked as if drugmakers' hard work--and big spending--had paid off. The president, industry leaders, and Senate Finance Committee Chairman Max Baucus together announced that drugmakers would cut $80 billion from their collective purses to aid the healthcare reform clause. Pharma leaders saw the deal as a hedge against cost cuts that could be much worse, and include such spectres as reimportation, price negotiation, etc. Lawmakers saw it as a way to induce other segments of the industry to follow suit.
And they did. But House lawmakers were up in arms. Some promised that they'd ignore the pharma deal; others didn't have to promise because they had introduced bills or amendments that would allow Medicare to negotiate drug prices, that would cut pharma's DTC advertising deduction, and more.
The White House ended up standing behind the deal, and the Senate held out for quite some time. Actually, until this week, when even PhRMA and other industry lobbyists admitted it might have to fork over more cuts. Perhaps $20 billion, some said, perhaps more. With a Senate vote coming as soon as Christmas Eve, that version of the bill could be said and done. The House version, however, isn't as pharma friendly (see resentment above). So who knows what will come out of the joint negotiations? 2010 will give us the answer.