In Health Reform, Boons for Hospitals and Drug Makers"...Hospitals and drug makers, which supported the final legislation, would be clear beneficiaries, ....
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Drug makers, meanwhile, may have the most clear reason to celebrate the legislation. Pharmaceutical companies are going to be asked to contribute $85 billion toward the cost of the bill in the form of industry fees and lower prices paid under government programs over 10 years. But they can look forward to tens of billions of dollars in additional revenue as more people with insurance visit doctors and fill prescriptions.
The legislation will also eventually close the gap in Medicare drug coverage, known as the doughnut hole, in which elderly patients must pay for prescription drugs rather than having them covered by the government. Many chose to stop taking their medicine or switched to lower-price generics.
And significantly, the legislation allowed the drug industry to “avoid any of the issues that were particularly of concern — price control or more regulation by the federal government,” said Barbara Ryan, an analyst with Deutsche Bank.
As a result, the pharmaceutical industry has been a significant proponent of the legislation, in sharp contrast to its behavior when the Clinton administration tried to pass a similar overhaul. The industry spent an estimated $100 million in TV advertising, grass-roots organizing and other marketing efforts to promote reform.
The generic side of the drug industry had somewhat less to celebrate. Legislators left intact a bill provision giving name-brand drug makers 12 years of marketing exclusivity on expensive medications called biologic drugs, which are made out of living cells. Many of those drugs, including cancer treatments, cost thousands or even tens of thousands of dollars a year.
“Real reform could have expanded access to affordable medicine to patients in need,” Kathleen Jaeger, the president of the Generic Pharmaceutical Association, said in a statement.
But generic makers stand to benefit from Congress's omitting a provision that had been proposed and that would have placed new restrictions on patent settlement agreements. Under such deals, some name-brand drug companies have paid or otherwise compensated generic makers to delay introducing new generics.
Critics, including the Federal Trade Commission, argue that such deals are anticompetitive. Jon Leibowitz, the chairman of the Federal Trade Commission, said last week that consumers would suffer if Congress allowed such deals to continue.
“The big winners are some of the branded pharmaceutical companies who have engaged in these deals and some of the generics who have done the same,” he said. “The big loser is the American consumer, who is going to have to pay an extra $3.5 billion a year in much-needed drugs.”
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http://www.nytimes.com/2010/03/22/business/22bizhealth.html?ref=business&pagewanted=all
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