Memo from Families USA
March 22, 2002

Drug Industry's Deceptive Lobbying at the State Level

There has recently been a spate of newspaper articles about an unusual kind of lobbying going on in state capitals aimed at defeating state initiatives to crack down on drug prices paid by the Medicaid program. There has been a flurry of faxes from a Michigan group called "The Consumer Alliance" to grassroots groups-especially organizations of color and faith-based groups-trying to mislead them about the issue and, in some cases, specifically trying to inject race-related issues into the debate. (We explain the issue below.)

This is really drug industry lobbying using a deceptive front group. We wanted to alert you to this in the hope that you can spot the deceptive tactic and help expose it by explaining it to your colleague groups, legislators, and the media. This deceptive tactic has proven to be effective, so it's critical that you expose it for what it is and make sure your colleagues aren't duped by this unethical lobbying campaign. (See one of the newspaper articles.)

"The Consumer Alliance" is an obscure for-profit group that is being paid to do the drug industry's bidding under the guise of a nonprofit "consumer" group (even their Web site has a ".org," which is a nonprofit symbol). They assert that they represent the views of consumers and low-income people. When you call the phone number on the fax they are distributing, you are connected to a Washington, DC-based lobbying group, Bonner and Associates, hired by PhRMA, the drug industry's trade association.

We urge you to spread the word about this so that as many groups as possible know what the drug industry is doing. Also, please let us know if this is happening in your state so we can track it. (Contact us at HealthAction@familiesusa.org; phone: 202-628-3030; fax: 202-347-2417.)

The issue that's been at the center of this lobbying is states' use of "prior authorization" to try to get doctors to prescribe more affordable drugs in the Medicaid program by requiring the doctor to specifically certify that the more expensive drug is required. The drug companies hate this because they want to sell their most expensive drugs and seek to avoid any regulation of the drug market. We think this strategy can be an effective way of reducing drug costs (thereby avoiding Medicaid cutbacks or allowing expansions) as long as the doctor has the final say. For more background on this issue, see a draft of a piece in a new Medicaid kit we're doing at (RX20drugs.pdf).