Oliver Wouters, a researcher from the London School of Economics, recently published research analyzing the lobbying expenditures and election contributions of pharmaceutical and health product industries. His results, published in JAMA Internal Medicine, reveal that the pharmaceutical and health product industries spent a total of $4.7 billion on lobbying the federal government, $877 million on state candidates and committees, and $414 million on presidential and congressional electoral campaigns, national party committees, and outside spending groups between 1999-2018. This spending was paralleled by an increase in per-person spending on prescription drugs from 1999 ($510/person, adjusted for inflation) to 2017 ($1025/person, adjusted for inflation).
“When considering legislative and policy initiatives, Congress and the executive branch benefit from fully considering the interests of all parties in society, not just those who seek to improve their access to officials through campaign contributions and lobbying expenditures,” Wouters writes.
Wouters retrieved data from the Center for Responsive Politics and the National Institute on Money in Politics, both of which are non-profit, non-partisan organizations that track federal and state campaign donations as well as lobbying expenditures. He also assembled data from the Senate Office of Public Records, who retain data on federal lobbying expenditures, and the Federal Election Commission, who house data on election campaign contributions.
For each of the 20 senators and representatives who received the most pharmaceutical and health product industry contributions, Wouters utilized records from the US Government Publishing Office to see whether they served on a committee or subcommittee that had authority over health-related legislation. Most states did not have data on state-level lobbying costs, and as a result, were not included in the analysis. The National Institute on Money in Politics, however, does collect data on pharmaceutical and health product industry campaign contributions for gubernatorial or other state candidates, house, assembly, or senate candidates, supreme court candidates, political party committees, and ballot measure committees.
Wouters found that a total of $64.3 billion was spent lobbying Congress and other federal agencies from 1999-2018, of which the pharmaceutical and health product industries spent the most: $4.7 billion, or 7.3% of total lobbying, for an average of $233 million per year.
17 of the 20 highest spending organizations within these industries were biological or pharmaceutical product manufacturers or were in their trade associations, of which the top spender was the trade group Pharmaceutical Research and Manufacturers of America (PhRMA; $422 million). The insurance industry spent the second most, at $3.2 billion, or 5% of total lobbying. The health care industry as a whole spent $9.7 billion.
The pharmaceutical and health product industries spent a total of $414 million on federal presidential and congressional candidates, national party committees, and outside spending groups. $367 million of that total was appropriated to party candidates, of which $216 million went to Republicans (58.9%) and $151 million to Democrats (41.4%). 15 of the highest spending organizations within these industries were biological or pharmaceutical product manufacturers, with PhRMA again making the list.
Five pharmaceutical companies made the top ten spending list for both campaign contributions and lobbying, including companies like Pfizer and Amagen. Congressional candidates received $214 million, while presidential candidates received $19.3 million from individuals and political action committees in the pharmaceutical and health product industries.
The top 40 recipients from each chamber of Congress received $45 million of all contributions to congressional candidates, and were well represented in leadership positions: 39 were members of committees with control over health-related legislation, and 24 held senior-level positions in these committees.
From 1999 to 2018, the pharmaceutical and health product industries contributed a total of $877 million to state-level candidates and committees, of which the majority ($661 million) went to ballot measure committees. There was not an even distribution between states: California received $399 million, Ohio received $74 million, and six other states received between $20 and 50 million: Missouri ($43 million), New York ($33 million), Oregon ($27 million), Florida ($26 million), Illinois ($23 million), and Texas ($22 million).
Funding tended to follow ballot measures – for instance, in Ohio, $61 million was spent in 2017, which coincided with the year a ballot measure intending to lower prescription drug costs was voted down. Contributions in states like New York followed a pattern that replicated state senate and assembly elections.
More than double the money was spent at the state level as compared to the federal level and tended to be targeted at senior legislators who were on committees that wrote health care bills, at opposing major drug cost-containment measures, and at presidential candidates.
Several organizations (most notably PhRMA, the American Medical Association, the American Hospital Association, and the Blue Cross Blue Shield Association) accounted for a disproportionate share of spending on lobbying; this follows a historical pattern for organizations like PhRMA and the American Medical Association, who have lobbied together in the past to prevent government interventions in the drug market. These efforts have dwarfed efforts from organizations like AARP, who have found that they have been vastly outspent on their lobbying efforts to represent consumers.
The $4.7 billion spent on lobbying and campaign contributions was just a drop in the bucket for the pharmaceutical and health product industries, as compared to the $5.5 trillion on prescription drugs in the US during that same 1999-2018 timespan.
“As a percentage of their revenues, well-resourced drug industry groups had to spend relatively little in their efforts to influence political and legislative outcomes,” concluded Wouters. “In contrast, many organizations advocating for the interests of patients and consumers have more limited financial resources.”
Wouters noted several legislative and regulatory changes that might address these and other discrepancies: restrictions on donations, transparency about financial associations, and mandating that chairs and ranking members of health committees publish online in an accessible and understandable format.
There were limitations to Wouters’ study, including 1) it wasn’t possible to verify the completeness of the data 2) there were inconsistencies in reporting of lobbying expenditures 3) there was a lack of information reported to the Center for Responsive Politics and the National Institute on Money in Politics during any given year 4) there was a lack of availability of state lobbying expenditures 5) federal data is reflective only of spending groups who are registered with the Federal Election Commission.
“An understanding of the large sums of money the pharmaceutical and health product industry spends on lobbying and campaign contributions can inform discussions about how to temper the influence of industry on US health policy.”
Wouters, O. J., (2020). Lobbying Expenditures and Campaign Contributions by the Pharmaceutical and Health Product Industry in the United States, 1999-2018. JAMA Internal Medicine. doi:10.1001/jamainternmed.2020.0146 (Link)