HHS should look into Azar's close ties to the drug industry

HHS should look into Azar's close ties to the drug industry
© Camille Fine

Over the next several weeks, it is anticipated that the White House will roll out its recommendations for reducing drug prices. For the millions of Americans struggling with medical costs, this proposal could determine whether or not they will be able to afford life saving drugs. The Department of Health and Human Services (HHS) is responsible for developing the administration’s drug price policy. 

Given the significance of this issue, it is critical that the American people have confidence that the proposed changes are based on sound policy. This is why my organization, Campaign for Accountability a nonprofit, nonpartisan watchdog group focused on public accountability, called on ethics officials at HHS to open an investigation into HHS Secretary Alex Azar and his relationship with his former employer, the pharmaceutical manufacturing giant Eli Lilly.

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Notably, between June 2007 and January 2017, Secretary Azar worked for Eli Lilly, serving most recently as the company’s president. While at the company, Sec. Azar championed the pharmaceutical industry’s goal of limiting the ability of pharmacy benefit managers (PBMs) to negotiate rebates. Drug companies, including Eli Lilly, have long complained that the rebates drive up drug prices and put money into the pockets of PBMs.

Shortly after Sec. Azar joined the Trump administration, Eli Lilly called on HHS to limit the rebates that drug manufacturers are forced to negotiate with PBMs Notably, it appears, Sec. Azar may have authored the administration’s “blueprint” to reduce prescription drug prices — a plan that specifically cites PBM rebates as a chief cause of high prescription drug costs.

On July 18, 2018, HHS essentially acceded to the drug makers’ demands and submitted a proposed rule to OMB that would drastically reduce PBM rebates. The text of the rule has not been released, but it appears that Eli Lilly would greatly benefit from the new regulation.

If Sec. Azar contacted Eli Lilly or worked with the company’s representatives to curb PBM rebates, he may have violated Executive Order 13770: Ethics Commitments by Executive Branch Employees, issued by President TrumpDonald John TrumpZuckerberg launches public defense of Facebook as attacks mount Trump leaning toward keeping a couple hundred troops in eastern Syria: report Warren says making Israel aid conditional on settlement building is 'on the table' MORE on January 28, 2017, which prohibits presidential appointees from working with their former employers on government business for two years after joining the administration.

In response to CfA’s request for an investigation, HHS responded only that “as required by the Ethics Pledge, [Sec. Azar] does not participate in any particular matters where his former employer is a party to the matter, or a party representative.” Notably, the agency did not deny that Sec. Azar may have met or spoken with company representatives.

As a result, to ascertain definitively whether or not the secretary has communicated with anyone from Eli Lilly, CfA filed a FOIA request with the agency for records of contacts between his office and the company.

CfA is not alone in its concern about the relationship between Sec. Azar and Eli Lilly. Members of Congress also have questioned Sec. Azar’s motivation for supporting the new rule. On August 17, Sens. Elizabeth WarrenElizabeth Ann WarrenZuckerberg launches public defense of Facebook as attacks mount Warren, Yang fight over automation divides experts Warren says making Israel aid conditional on settlement building is 'on the table' MORE (D-Mass.) and Tina SmithTina Flint SmithOvernight Defense — Presented by Boeing — House passes resolution rebuking Trump over Syria | Sparks fly at White House meeting on Syria | Dems say Trump called Pelosi a 'third-rate politician' | Trump, Graham trade jabs Senate confirms Trump's Air Force secretary pick Our hidden infrastructure crisis: School cafeterias MORE (D-Minn.) sent a letter to Sec. Azar asking whether he had worked with Eli Lilly to limit PBM rebates. Additionally, earlier in August, Sen. Orrin HatchOrrin Grant HatchTrump holds more Medal of Freedom ceremonies than predecessors but awards fewer medals Trump to award Medal of Freedom to former Attorney General Edwin Meese Trump to award racing legend Roger Penske with Presidential Medal of Freedom MORE (R-Utah) and Rep. Greg WaldenGregory (Greg) Paul WaldenTop Republican rejects Democratic chairman's approach to stopping surprise medical bills Lawmakers hit Trump administration for including tech legal shield in trade negotiations CBO: Pelosi bill to lower drug prices saves Medicare 5 billion MORE (R-Ore.) sent a letter to OMB Director Mick MulvaneyJohn (Mick) Michael MulvaneyWhite House officials work to tamp down controversies after a tumultuous week Sunday shows — Mulvaney seeks to tamp down firestorm over quid pro quo comments, Doral decision Mulvaney says he thinks Trump knows people thought Doral decision looked 'lousy' MORE calling for a “transparent, open, and deliberative process” before changing regulations with such a far-reaching impact on patients, federal programs, and taxpayers.

Regrettably, it seems that high-level Trump administration officials have a track record of operating in their own, rather than the public’s interests. Former HHS Secretary Tom PriceThomas (Tom) Edmunds PriceIndustrial food system is at the heart of biodiversity degradation and climate change Joe Lieberman's son running for Senate in Georgia The Hill's Campaign Report: Impeachment fight poses risks to both Trump, Dems MORE and EPA Administrator Scott PruittEdward (Scott) Scott PruittSierra Club sues EPA over claim that climate change 'is 50 to 75 years out' EPA on 'forever chemicals': Let them drink polluted water EPA moving ahead with science transparency rule by 'early next year' MORE were forced to resign as a result of their own ethical lapses and other cabinet secretaries including Commerce Secretary Wilbur RossWilbur Louis RossUS ban on China tech giant faces uncertainty a month out US imposes new sanctions on Cuba over human rights, Venezuela Commerce Department to develop stats on income inequality MORE and Interior Secretary Ryan ZinkeRyan Keith ZinkeOvernight Energy: Perry to step down as Energy secretary | Future of big-game hunting council up in the air | Dems lose vote against EPA power plant rule Future of controversial international hunting council up in the air Overnight Energy: Advisory panel pushes park service to privatize campgrounds | Dems urge Perry to keep lightbulb efficiency rules | Marshall Islands declares national climate crisis MORE remain under investigation.

Last year, during a Cabinet meeting, President Trump said drug companies are “getting away with murder,” in part because of the extent of their political influence in Washington. He’s right. This is exactly why HHS must investigate whether Sec. Azar has been in cahoots with his former employer, which stands to benefit dramatically if this new regulation is implemented.

Daniel Stevens is the executive director of Campaign for Accountability, a government watchdog in Washington.