Critical Condition

Drug Deal

I wrote last month about the trouble Henry Waxman caused the White House by saying the the “White House is not bound” by their cost-cutting deal with the pharmaceutical industry. The New York Times is now reporting that the White House has just reaffirmed the deal, and the article has some very juicy details on some of the behind the scenes machinations. Billy Tauzin, Pharma’s head and a very sharp negotiator, is quoted as saying that “We were assured: ‘We need somebody to come in first. If you come in first, you will have a rock-solid deal.’” Tauzin complied, and while his industry offered up significant cuts, the White House pledged “to protect drug makers from bearing further costs in the overhaul.”


Tauzin further said, “Who is ever going to go into a deal with the White House again if they don’t keep their word?” which is the point that I made in my earlier post and I would bet is something Tauzin said directly to his contacts in the White House after the Waxman story broke.


The article points out that there will be some elements unhappy with this deal, such as House Members like Raul Grijalva (D., Ariz.), who complained that “We have all been focused on the debate in Congress, but perhaps the deal has already been cut.” In addition, the Times noted, “The agreement could prove embarrassing to the White House, which has sought to keep lobbyists at a distance, including by refusing to hire them to work in the administration.”


Finally, I couldn’t help detecting a note of schadenfreude in Tauzin’s last quote in the article, in which he referenced the recent attacks by the administration on the insurance industry, saying “The insurers never made any deal.”