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Bill affecting pharmaceutical industry presages heavyweight political battle

Jon Ralston
Jon Ralston
Opinion
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The phalanx of lobbyists strolling out of the Assembly leadership offices on Wednesday afternoon represented an array of potent special interests.

Gaming. Unions. Insurance.

About a dozen or so in all, including D. Taylor, the leader of the Culinary union’s international parent, who enjoys his time at the Legislature as much as he relishes a tour of the Venetian. If Taylor had made the long trek to be amid this polygamy of convenience, this was serious.

The longtime economic and political symbiosis of the Culinary and virtually every gaming executive not named Sheldon Adelson or Frank Fertitta combined with the money and influence of the insurance lobby would be impossible to defeat. Whatever this group wanted, this group was going to get. Right?

Not so fast.

Despite this alliance’s formidable power, these folks are up against a new capital player that is no ingénue in the political world, one that has hired almost every advocate in the building who was not in that Wednesday meeting and one that has unlimited resources.  Big Gaming, Big Labor and Big Insurance, meet Big PhRMA.

In one of the more fascinating political conflagrations to ignite Carson City in years, the pharmaceutical industry is bringing its clout to bear to squash a freshman senator’s attempt to impose price controls on diabetes medications and bring transparency measures to companies and their nonprofit allies. This is a parochial fight with global implications – if the measure is signed by Gov. Brian Sandoval (I’ll get to that dynamic in a moment), what happens in Nevada will not stay in Nevada. Senate Bill 265, sponsored by Democratic Sen. Yvanna Cancela, could become model legislation for every state, could open the door to more regulations and price controls and could alter the way Big PhRMA does business.

The stakes could not be higher, which is why the lobbying might on both sides is so prodigious. And with an easy bogeyman for the home team – does anyone like Big PhRMA? – the Democratic leaders of the Legislature could reap a political bonanza if the Republicans, including a popular governor, try to block what has become a priority item for the party in charge.

The policy questions here are more nuanced than the good vs. evil construct the believers will supply. It’s hard to argue with more transparency and better access to medication, especially for a disease such as diabetes that afflicts so many. But it’s not unreasonable for backers to also address the potential release of proprietary information and the hoary Big PhRMA arguments that such government regulation stifles innovation and raises prices.

Is this a free market that will now be destroyed by government fetters? Or is this a distorted market for life-enhancing or even life-saving drugs that requires government intervention?

This is a debate worth having. And let the best argument win.

Alas, there are no price controls on Pollyanna pills, which are too expensive for most jaded pundits. And like so many nuanced public policy colloquies in the non-deliberative so-called legislative process, I fear the robust discussion will not occur.

Which returns me to the political battle to come.

The industry has not just retained many of the usual business lobbying suspects with deep relationships among legislators, but Big PhRMA’s team also includes a former Democratic speaker (John Oceguera) and majority leader (Marcus Conklin) as well as a former Democratic lawmaker (David Goldwater). And the issue has caused a nasty rift among organized labor, many of whom see ex-AFL-CIO chief Danny Thompson as a quisling for accepting a contract with a trade group that specializes in neutralizing unions.

We’ve already seen, by virtue of Megan Messerly’s reporting, that Big PhRMA knows how to astroturf. Nothing could have made a better case for transparency than nonprofits renting their credibility to the industry for a few pieces of silver. But groups such as Retire Safe (“Standing up for America’s Seniors”) and The Epilepsy Foundation, otherwise do good work and may have influence with some lawmakers by arguing the bill will hurt patients.

But can real grassroots defeat faux grassroots?

Cancela is the recently departed political director of the Culinary whose impressive skill was organizing campaigns, including the one that almost single-handedly elected Rep. Ruben Kihuen (whose place she took in the state Senate). She may be new to legislating, but she knows how to build support at the base level.

This is family affair, too, as this is not just a Culinary bill from the Culinary’s former political director. Taylor’s involvement signals this is a national concern and his wife, Bobette Bond, has been pushing issues like this one for years in Carson City as the union’s health care lobbyist.

I expect that phone calls and emails from individual legislative districts could be generated – I’m told by a couple of sources that supporters already have district-by-district names of diabetics. And even though we reported that Big PhRMA gave $127,900 to lawmakers last cycle, that’s a microscopic fraction of what gaming, unions and insurance companies gave to the Gang of 63. Lobbyists for the so-called Health Services Coalition, which is made up of mutual back-scratching unions and gamers, are some of the best in the building.

So I have little sympathy for any crocodile tears shed by those with the real juice. One great irony of this, too, is that insurance outfits – and let’s not forget that the Culinary and the major gaming companies double as insurance companies – are wearing a white hat in this fight. Now, that is an astonishing accomplishment by Big PhRMA, whose lobbyists may try to paint it black again as they are doing in Oregon to fight legislation.

If this comes down to an extended ad campaign, the locals likely can’t compete with the industry. And that’s why I think the supporters want this to happen sooner rather than later – that is, they don’t want Cancela’s bill to be pounded by an air and digital war and then potentially disappear into the black hole of The Rush to Close in late May.

Watch what happens this coming week – the next major deadline is April 25 for legislation to get out of the house where it originated. I’m reliably told the bill will be amended – tweaked but not gutted. If it can then be sent to the Assembly and pushed over to the governor, thus avoiding the horse-trading shenanigans of the endgame, it has a better chance.

I think the most obvious Big PhRMA strategy is to try to slow the bill down and make it into a party-line vote that will put immense pressure on Sandoval. They have some lobbyists on their team who are experts at such maneuvers – and they can always add more!

Which brings us to the seminal question of Session ’17, with a Democratically controlled Legislature and a Republican governor, and one that is especially provocative vis a vis Cancela’s bill: Will Sandoval sign it?

Cancela sounded optimistic Friday, telling me, “I think he will because this is a public health crisis in the state.”

The youthful rookie lawmaker may have access to those Polyanna drugs, but her earnestness is not affected and is combined with a rare and precocious political savvy. And here’s why I think she may be right:

Even though Sandoval might feel pressure not to look like a tool of Big PhRMA and veto a bill about transparency, I think those atmospherics will come into play less than some other factors.

Sandoval has no relationship with the industry. But he does have close ties to some of the lobbyists involved in supporting the bill and his chief of staff, Mike Willden, is a former head of the state’s health and human services department who understands these issues and helped persuade the governor to expand Medicaid.

Sandoval may even sign it if it’s a party-line vote because he is in his final session and he has never been as much a partisan as he has been deliberative. The pressure to deny the Democrats a win on an issue that could resonate in 2018 will be immense, though.

This is a classic issue where the Democrats could win even by losing – it’s a political bludgeon up and down the ticket next year. But there’s much more at play and at stake here – for Cancela and for some of the interests who think they could save a lot of money and ensure their employees and thousands of others don’t get gouged at the pharmacy counter.

The political fight promises to leave scars for the politicians and lobbyists involved. Those will fade. But the policy made or not made in the next few weeks will have reverberations for a long time to come.

 

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