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Pharmaceutical Industry Keeps Hand In Health Care Bill: Interview With Billy Tauzin

This is a transcript of NPR host Linda Wertheimer’s interview with Billy Tauzin on July 30, 2009. It begins with Ms. Wertheimer’s introduction:

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One major player in the health care debate: the pharmaceutical industry. Last week, NPR reported that PhRMA, the Pharmaceutical Research and Manufacturers of America, spent $40 million lobbying Congress this spring.

PhRMA got an early deal to take key items off the table, like importing drugs from Canada, the government’s ability to negotiate drug prices. And PhRMA agreed to drug discounts totaling $80 billion over 10 years to help lower health care costs. Former Louisiana Congressman Billy Tauzin is PhRMA’s president and CEO. I asked why PhRMA supports a health care overhaul now.

Mr. BILLY TAUZIN (President and CEO, Pharmaceutical Research and Manufacturers of America): Because it needs to get done. I mean, we agree with the president. This is not only just a moral imperative that we make sure people in this country have good insurance and access to these products that can keep them out of the hospital and keep them healthy, but we also believe it’s an economic imperative now. And the studies we have indicate that if we do nothing now, this country is going to get sicker and poorer and less competitive in the world.

WERTHEIMER: Your organization jumped out early on the health care bill and went straight into the White House and began negotiations on certain big issues that you wanted to be sure you knew what you were going to get going in. Was that the right decision?

Mr. TAUZIN: Oh, absolutely the right decision. We had the opportunity to be first. I’ve always believed that you get ahead of issues. You don’t wait for them get ahead of you.


Mr. TAUZIN: Why? Because, again, if we had a better chance, we could actually wrestle some of these difficult issues to the ground and we would know in advance what our exposure was in the process, settle some of the difficult issues that we faced. And that all made good sense to us.

WERTHEIMER: One of the things that you negotiated with the White House was that there would not be a big fight over importing drugs from Canada at lower costs. And there were other issues that you wanted to be sure that the president was not going to get in your way on.

Mr. TAUZIN: Well, wait. I mean, you made an assumption. Let me hopefully clarify that. We negotiated our contribution, a total $80 billion. I can tell you the president wanted more and we wanted less. And some have said, ‘oh, that’s a sweet deal.’ Twice the proportionate share of our marketplace against the cost of the bill is not a sweet deal. That’s a heavy burden. It will mean less money spent on research in the next 10 years, and that’s not good. It’s going to be a heavy price. And we’re going to indeed have some real difficulty with some companies.

WERTHEIMER: Do you think that you can keep it at that level? Do you think it’ll go up? The leadership in Congress has suggested that maybe you’re not thinking about doing enough.

Mr. TAUZIN: Well, I just explained to you why I think we’re doing more than enough. We’re doing a lot more than some of the other sectors proportionately. Yeah, everybody thinks we’re 50, 70 percent of the health care spending. We’re not. We’re 8 percent. The reason they think it’s higher is because of the high co-pays. If every time you had to pull money out of your pocket to buy a medicine – when your Blue Cross covers your hospital – you think it must be medicine’s driving the cost of health care. It’s not.

If you took all the profits away from all the pharmaceutical companies in America, all of them, every bit, so there’d be no more money for research, no more money for investors, you’d end up with a one-and-a-half percent reduction in health care costs. It’s not the big pocket of money people think it is.

WERTHEIMER: National Public Radio has a poll out that shows that approval of the president’s health care plan has slipped, that more people disapprove than do approve now. I mean, it’s still quite close, but do you think this thing can be done?

Mr. TAUZIN: Yeah. It will not be what everybody wants. It never is. But, it will, I believe, be a huge and substantial step toward covering the Americans who are not covered and changing the course of health care in America toward real prevention and disease management rather than just damage control. That’s the big pieces we’ve got to do. If we can do that, we’ll control costs long- term. You will have a healthy America. You will have a more productive America, and you will have literally a wealthier America.

WERTHEIMER: Would you have a wealthier pharmaceutical industry?

Mr. TAUZIN: I can’t predict that. I can only tell you that we’ll do okay.

WERTHEIMER: Mr. Tauzin, thank you so much.

Mr. TAUZIN: Oh, always a pleasure.

WERTHEIMER: Billy Tauzin is the president and CEO of PhRMA, which represents most of the brand name prescription drug companies.

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Cost and Quality The Health Law