Strange Bedfellows: Pharmaceutical Companies and Identity Politics

The New York Times reported on the high costs of New York State's Medicaid program related to its payments for prescription drugs, with most surprising results.

The New York State Medicaid program until recently had virtually no cost controls on prescription drugs. Its spending on drugs had gone from $1.7 billion in 1999 to $3.8 billion in 2004. Between 2002 and 2004, it spent $157 million on the drug Nexium, esomeprazole (AstraZeneca), which is chemically very similar to, and has no clinical advantage over generic omeprazole. The program spent more on specific drugs than did programs in other states, for example, it paid $18.70 per cannister of generic albuterol, while the Texas program paid $6.63, and $3.67 per capsule of omeprazole, while California paid $1.44.

The Times noted that New York Governor Pataki, a conservative Republican, had sought various ways to control Medicaid spending on drugs. He asked to cut reimbursement rates to pharmacies for specific drugs, require prior authorization for specific drugs, and develop a preferred drug program. Opposing all these moves was the Democratic majority in the state legislature. According to the Times, "the most pivotal opponents to the [preferred drug] program were Hispanic lawmakers in the Democratic majority in the State Assembly, along with Hispanic advocacy groups, who wanted to retain an unlimited choice of drugs for Medicaid recipients. The Hispanic Federation, a coalition of health and social service agencies in the New York region, held repeated events in Albany to denounce the proposal, saying it endangered patients." "Assemblyman Peter M. Rivera, a Bronx Democrat and Chairman of the Assembly's Puerto Rican/Hispanic Taks Force, helped lead the opposition to the drug list." "Last spring, Mr. Rivera circulated a report among his colleagues saying that Hispanics as a group can react differently to drugs than others. As a result, the report said, pharmaceutical plans should cover a wide range of drugs because restricting them could force Hispanics to take some that are not appropriate for them."

Hold the phone, here. This is all very strange. A conservative Republican fighting to restrict payments for pharmaceuticals? Left-wing Hispanic Democrats leading the charge for practically unlimited spending on pharmaceuticals? None of this fits the usual US political mold.

The Times suggests some answers.

• One of the Board of Directors of the Hispanic Federation is Sylvia M. Montero, Senior Vice President, Human Resources at Pfizer Inc . "The federation has received contributions from Pfizer since the mid-1990s, including a $50,000 donation las year.... The group also receives contributions from other drug companies...."
• Assemblyman Rivera "has received more than $20,000 in campaign donations from drug company interests, among the highest total for state lawmakers." Although he asserted, "I am not doing this because I am in the pocket of the pharmaceutical companies. I am doing it because it's the right thing. The governor is trying to balance the budget on the backs of poor people."
• The report circulated by Mr. Rivera was written by the National Alliance for Hispanic Health, "an advocacy group in Washington that is heavily financed by pharmaceutical companies and has a corporate advisory board whose members are mostly pharmaceutical executives, according to the group's records. The alliance worked on the report with the National Pharmaceutical Council, a trade group of major pharmaceutical companies."
• "Overall, pharmaceutical companies and trade groups, including Pfizer, Merck, Bristol-Myers Squibb and Eli Lilly, are among the biggest contributors to state politicians in Albany. Since 2002, they have given roughly $2.5 million to New York candidates and committees 0n the state level, channeling most of it to the majorities in the State Assembly and Senate."
• "Pfizer, which fought the drug list most vigorously, gave about $300,000 in campaign contributions last year alone, up from $100,000 in 2002."

Big pharma companies seem to have spent considerable money and effort ingratiating themselves with people and organizations who promote the politics of ethnic identity. (This has occurred even though the interests of large corporations, including pharmaceutical corporations, stereotypically are linked to the right wing, and the promotion of ethnic identity is usually linked to the left wing, or at least the academic and cultural left.) And now those who promote the politics of ethnic identity seem to be promoting policies that benefit big pharma more obviously than they benefit their ethnic constituencies. Such policies, however, may be very costly to the public as a whole, siphoning off money that could be spent on health care for all, including the disadvantaged.
You really can't tell the players any more without a score card.