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Obama Health Care Reform Effort Gets $150 Million Boost From Unlikely Ally

August 14, 2009
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With members of Congress being subjected to constituent ire and cable news programs focusing on shouting matches and protests, the Obama administration’s attempt at health care reform may get its biggest boost from an ad blitz paid for by the pharmaceutical industry.

The industry’s lobby group, the Pharmaceutical Research and Manufacturers of America, will spend $150 million while Congress is on summer recess, according to executives with knowledge of the plans, to try to convince Americans that the president’s plan for health care reform is the right way to go.

PhRMA senior vice president Ken Johnson declined to reveal how much the group will spend but said some of the ads will be TV spots in 12 key states, while others will be part of a national cable buy and still others will run on radio and in print.

“I’m not going to speculate on the amount of money, but our board has agreed to make a significant commitment to try and bring health care reform across the finish line,” Johnson said. “The new ads will focus on the importance of making certain that everyone has high-quality, affordable health insurance, including affordable co-payments and does not deny coverage because of a pre-existing condition.”

Johnson declined to name the agencies producing the work but said the ads are part of an umbrella effort called Americans for Stable Quality Care. PhRMA is leading the group, which also includes the American Medical Association; the powerful Service Employees International Union; and the Washington-based health care advocacy group Families USA, with which PhRMA partnered recently on the “Harry and Louise” TV ads.

Healthy Economy Now, another pro-reform group, has already run one flight of ads. The group comprises many of the same members as Americans for Stable Quality Care, including PhRMA, the AMA and SEIU, along with AARP and the Business Roundtable, an association of CEOs of leading U.S. companies.

Traditionally pro-Republican
Traditionally PhRMA has been pro-Republican. Its president and CEO, Billy Tauzin, is a former U.S. representative from Louisiana who was elected as a Democrat but switched to the Republican Party.

But drug makers are certainly in favor of reform, in part because a guarantee of health insurance coverage for the approximately 45 million Americans without it likely would mean an increase in prescription drug sales and in part because of a loose agreement reached with Senate Finance Committee Chairman Max Baucus, D-Montana, in which pharmaceutical companies agreed to pick up $80 billion—but no more—of the estimated $1 trillion cost of health care reform in the next 10 years.

It’s still a crapshoot for PhRMA, however. Rep. Henry Waxman, D-California, is already on record saying the deal is not set in stone, and the Associated Press reported that when several groups agreed to accept the cost reductions, Tauzin was not among those invited to the White House.

Johnson said observers should quit focusing on political affiliation.

“We’ve always tried to be as inclusive and bipartisan as possible,” he said. “In the past we’ve worked with Republicans and today we work with Democrats. But we believe a bipartisan bill will emerge that will serve as the blueprint of reform.”

‘On the right side of history’
Peter Pitts, former associate commissioner for the Food and Drug Administration and president of the Center for Medicine in the Public Interest, said he agrees this isn’t about partisanship.

“I don’t think it’s a question of PhRMA running ads that are pro-Obama versus ads that are anti-Obama,” Pitts said. “They’re simply ads that talk about the need to change the system for the better. I see it as PhRMA trying to lead the parade as opposed to being swept up in the tides of health care reform. I see it as PhRMA being smart, trying to stay out in front and trying to be on the right side of history.”

And it makes business sense.

“I think the industry saw that a different tack was needed given the changes in the marketplace combined with a very negative perception of the industry,” said Mike Guarini, president of New York-based health care agency MRG Management Services.

Guarini has seen the health care debate from both sides, including from the position of marketing director at Bristol-Myers Squibb.

“I think the industry wanted to be at the table instead of being dictated to. On a pure commercial basis? More people covered, more prescriptions sold,” Guarini said.

Others don’t see it that way.

The Alexandria, Virginia-based 60 Plus Association, a senior citizens advocacy group that says it is nonpartisan but also refers to itself as “the conservative alternative to the AARP,” began a national cable TV ad campaign this week opposing reform.

The 60-second spot plays to senior citizens’ fears of a government takeover of health care, warning that Congress plans to cut $500 billion from Medicare and including a frightening line: “The government, not doctors, will decide if older patients are worth the cost.”

“This strikes at the heart of the debate over the value of our seniors’ lives versus the cost of expensive treatments they need to stay healthy or get better,” said Jim Martin, president of 60 Plus.

Spending by opposition groups
Club for Growth is another advocacy group against government-run health care.

The Washington-based Republican group is spending $1.2 million on two ads. One compares the Obama plan to government-run health care in England and says, “Life-and-death decisions should be made by patients and doctors, not politicians.” The second ad focuses on the spiraling costs and ends with the narrator telling people to get in touch with Senate Majority Leader Harry Reid, D-Nevada.

“Our message is simple,” said Club for Growth President Chris Chocola. “If you oppose government-run health care, call Harry Reid. If you oppose higher costs, less coverage and more bureaucracy, call Harry Reid. If you want real health care reform that begins with patient-centered, free-market solutions and ensures more Americans have access to quality care, call Harry Reid.”

The Republican National Committee also produced an ad that mocks health care reform by mimicking the imagery found in most pharmaceutical ads—couples frolicking on the beach, soft music in the background. Called “Reforma,” the ad features a narrator who says, “Not recommended if you like your own doctor, want to keep your own doctor or want to avoid the government prescribing your medical treatments.”

Even the combined spending of those opposition groups is likely to be dwarfed by PhRMA and Stable Quality Care. But does it make sense for PhRMA and its allies to lay out so much money for something as old-school as TV ads?

“It makes sense,” Guarini said. “From what I can see, opposition is concentrated among older-skewing audiences, so traditional media should be fine. I think it will have a positive impact on the debate, and should work.”


Filed by Rich Thomaselli of Advertising Age, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.

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