Gibbons backs drug-monopoly bill

Benjamin Grove

Friday, Feb. 18, 2000 | 11:20 a.m.

WASHINGTON -- Rep. Jim Gibbons, R-Nev., has backed a controversial bill that extends monopolies held by pharmaceutical companies on drugs such as Claritin allergy medication and blocks cheaper generics from flooding the market, critics say.

New Jersey drug-maker Schering-Plough officials say they want to extend the Claritin patent beyond 2002 because the Food and Drug Administration deprived them of years of profit by delaying drug approval. The company has spent millions in lobbying efforts and in campaign contributions to bolster their case.

The bill in Congress would force the U.S. Patent and Trademark office to review the matter. The reviewers could extend the patent up to three years.

Schering-Plough's chairman, Richard Jay Kogan, told Congress last year that the company needs Claritin profits to promote research on lifesaving drugs.

"It's impossible to have one without the other," he told the Senate Judiciary Committee in August.

Gibbons, who has not received money from Schering-Plough according to Federal Election Commission records, signed the Claritin bill Feb. 8. He is the most recent of 78 House members to co-sponsor the 10-month-old bill. A similar bill has eight signatures in the Senate. Both bills await further congressional committee hearings.

"There is a large number of our seniors on fixed incomes, and we need to come up with ways for them to afford drugs," Gibbons' chief of staff, Mike Dayton, said.

"But we should not be penalizing the pharmaceutical industry, which spends millions of dollars on research and development. We need to make sure their investment is protected."

Gibbons was traveling Thursday and today and could not be reached for comment.

Millions of Americans use Claritin to ease allergy suffering. Several Las Vegas allergy doctors said 20 to 25 percent of the population suffers from some sort of allergy and many need medication.

A daily dose of the antihistamine costs between $1.80 and $2.50, but generic companies say they could sell a dose for roughly 50 cents, bill critics say.

Schering-Plough sold $2.3 billion worth of Claritin in 1999, a cornerstone of the company's $2.1 billion net profits, according to company disclosures.

A 1999 University of Minnesota study found that consumers could save $3.4 billion between 2002 and 2005 if Claritin faced generic competition.

Critics of the bill say it is a classic example of how corporate money and muscle can influence Congress.

"It's the money and the well-connected people that have prevented this from being laughed off the face of the earth," said Maura Kealey, spokeswoman with Washington-based consumer advocate group Public Citizen.

"If they get away with this, every other drug company will have just as much right to this remedy. They'll say, 'You did it for Claritin. You've got to do it for us.' "

Kealey said the company has spent $11 million on lobbying. FEC records show the company spent $683,191 in the 1996 and 1998 election cycles and $292,000 in 1999 in campaign contributions to the Republican and Democratic parties.

The company made $169,500 in additional contributions to individual candidates in the 1998 cycle. Schering-Plough has targeted key members on the Senate and House Judiciary committees, where the bill originates.

Committee chairman Sen. Orrin Hatch, R-Utah, who was the focus of news articles after he used Schering-Plough's jet, got $4,000 last year. Committee member Sen. Robert Torricelli, D-N.J., got $10,000.

"I've been in this town for 15 years, and I've never seen any lobbying effort like this," said Brad Cameron, whose Washington public relations firm represents generic drug makers and seniors.

"Schering makes about $5 million a day on Claritin alone, so to spend a few million on lobbying is money well spent as far as they are concerned."

Cameron's firm has linked arms with the Campaign for Fair Pharmaceutical Competition. The group also represents seniors groups and generic drug makers, which also stand to make billions. The group was encouraged when Rep. Jo Ann Emerson, R-Mo., and Sen. Conrad Burns, R-Mont., dropped their names from the bill.

"Just when we get enough people who drop off of it, we get new people on, and Jim Gibbons is one of the new ones," said Tracie Onbashian, the group's director. "This has legs as long as we have people who sign onto the bill. Schering-Plough has a lot of money."

The bill has raised the eyebrows of some Nevada seniors, too. Besides Claritin, the bill could ultimately extend patents for seven other drugs that seniors use for stroke and cancer treatments as well as to treat ailments such as arthritis and skin problems.

"The association's position is that we are very concerned about the bill resulting in higher costs," said Carla Sloan, Nevada director of the AARP. "It may not be in the best interest of consumers."

But bill supporters, including some doctors, say the legislation protects vital research.

"It's important for pharmaceutical research to have this patent protection," Schering-Plough spokesman William O'Donnell said. "This is a process to take what has been at times a highly politicized process and put it before an independent body where rational decisions are made based on independent criteria."

Schering-Plough spent nearly $1.2 billion on research and development last year, company disclosures say.

"From a medical standpoint, it's critically important that pharmaceutical companies get an opportunity to develop their drugs knowing that there is going to be a financial reward at the end," Las Vegas allergy doctor Victor Cohen said.

Another Las Vegas allergy doctor Jim Christensen said a complex web of factors influence the drug's cost, including soaring advertising costs and stockholder pressure.

"It's expensive," Christensen said. "Is it required to be that expensive because of all the on-going costs, the research and development? I don't know. The whole thing is very complicated, and the more I examine it, the less I know."

But Christensen adds, "To do special interest legislation, it doesn't pass the smell test. They've had their time. They've probably more than made their money off this drug."

Bill sponsors are adamant. Reps. Ed Bryant, R-Tenn, and Jim McDermott, D-Wash., who received $10,000 and $7,000 respectively from Schering-Plough in the 1998 election cycle, introduced the bill in the House.

"Our bill would take the politics out of the equation and allow each claim to rise or fall on its merits," McDermott said in a statement when he introduced the bill. "We are asking the Patent and Trademark Office to oversee a procedure, which will investigate whether the patents for any of these medicines should be extended."

Nevada's other House member, Democratic Rep. Shelley Berkley, is still reviewing the bill, her staffers said. Sens. Richard Bryan and Harry Reid, both D-Nev., have not signed the Senate version.

"To me, it's a $7 billion government and consumer rip-off," Bryan said. "My understanding is that they have already been given two extensions. There is a point at which the American consumer is entitled to be heard."

Dayton said Gibbons is "open to hearing both sides of this issue. He wants to make sure we have a free market place with prescription drugs. He says that pharmaceutical companies spend a lot of money investing in life-saving drugs."