5 Things to Know About Pharma's Far-Reaching Influence

Many Americans are concerned about pharma’s growing influence throughout the healthcare industry and the implications this may have over drug prices.

Here are 5 things to know about trends in public concern about pharma's reach:

1. New database tracks pharma’s donations to patient advocacy groups

Recently, Kaiser Health News (KHN) released a database that logged 12,000 donations from large, publicly traded drug manufacturers to patient advocacy groups in 2015. The data show that pharmaceutical companies gave at least $116 million to advocacy groups in 2015 alone.

The database, called “Pre$cription for Power,” included the 20 pharmaceutical companies listed in the Standard and Poor 500, of which 14 were transparent to some degree about giving money to patient groups. The same 14 companies reported only about $63 million in lobbying activities for the same period. Though the data only explored a piece of the pharmaceutical industry’s giving overall, it will be expanded with more companies and groups over time, says KHN.

2. Under new tax law, pharma received breaks but raised drug prices

A new report from Democratic Senator Cory Booker’s staff investigated how pharmaceutical companies spent their savings from tax reform. Though shareholders are seeing an increase in buybacks and dividends, the report notes that patients won’t see an immediate relief on their expenses.

Five US drug companies implemented share buybacks totaling $45 billion before or shortly after US lawmakers passed tax reform. In a group of those drug makers and 5 other United States-based companies, none reduced prices in response to the law; however, some did announce increases in research and development, employee pay, or charitable contributions.

The senator’s team that compiled the report said it will be “important to monitor” the pharmaceutical companies as they “continue to make decisions regarding how to allocate their savings.”

3. Industry group spent millions to help control drug pricing message

According to tax disclosures from 2016, the pharmaceutical industry’s biggest trade group, the Pharmaceutical Research and Manufacturers of America (PhRMA), raised revenue by almost one-fourth and spent the millions it collected among hundreds of lobbyists, politicians, and patient groups.

This increased spending in 2016 coincided with a flurry of bad publicity about high drug prices after several previously inexpensive drugs became extremely costly. In response, PhRMA spent $7 million in 2016 to prepare its “Go Boldly” campaign, which shows patients and researchers united in the fight against diseases including heart disease, cancer, and Alzheimer disease.

Some of the largest donations PhRMA gave were received by organizations representing patient groups whose members require high-cost drugs. In fact, PhRMA spent more than $2 million on groups such as the Autoimmune Related Disease Association, the American Lung Association, the Lupus Foundation of America, and the Juvenile Diabetes Research Foundation.

4. AAM addressed relationships with patient groups in its new code of ethics

The Association for Accessible Medicines (AAM) released a new code of ethics for its member companies that specifies companies should not only respect the autonomy of patient organizations but ensure that support for the organizations in the form of grants or charitable contributions is not conditional on the promotion of a specific medicine.

The code incorporates goals and criteria ensuring its members continue to maintain ethical relationships with healthcare professionals and provide objective and accurate information about their medicines.

5. A survey of patient groups revealed some improvements in pharma’s reputation

The organization PatientView recently released the 7th edition of its Corporate Reputation of Pharma report that explored the views of 1330 patient groups worldwide on the reputation of the pharmaceutical industry. Overall, 43% of patient groups that responded to the survey believed that the pharmaceutical industry had an “excellent” or “good” corporate reputation in 2017, compared with 38% in the year prior.

However, patients’ view of pharma was more negative in several other key aspects. For example, 57% of patient groups saw pharma as “excellent” or “good” at producing high-quality producs, a figure that was down from 64% in 2016. Notably, the most recent data show the lowest-reported percentage of groups who believed in pharma’s ability to manufacture high-quality products since 2011.