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 TrumpTrump defends Stephanopolous interview Trump defends Stephanopolous interview Buttigieg on offers of foreign intel: 'Just call the FBI' 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 WarrenJulián Castro defends going on Fox: I'm focused on 'the people out there watching' Julián Castro defends going on Fox: I'm focused on 'the people out there watching' O'Rourke unveils plan to support women, minority-owned businesses MORE (D-Mass.) and Tina SmithTina Flint SmithDemocrats ask Fed to probe Trump's Deutsche Bank ties Democrats ask Fed to probe Trump's Deutsche Bank ties Democrats push election security legislation after Mueller warning 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 to award Medal of Freedom to economist Arthur Laffer Trump gambles in push for drug import proposal Biden's role in Anita Hill hearings defended by witness not allowed to testify MORE (R-Utah) and Rep. Greg WaldenGregory (Greg) Paul WaldenHillicon Valley: Democratic state AGs sue to block T-Mobile-Sprint merger | House kicks off tech antitrust probe | Maine law shakes up privacy debate | Senators ask McConnell to bring net neutrality to a vote Hillicon Valley: Democratic state AGs sue to block T-Mobile-Sprint merger | House kicks off tech antitrust probe | Maine law shakes up privacy debate | Senators ask McConnell to bring net neutrality to a vote Maine shakes up debate with tough internet privacy law MORE (R-Ore.) sent a letter to OMB Director Mick MulvaneyJohn (Mick) Michael MulvaneyElection security bills face GOP buzzsaw Election security bills face GOP buzzsaw White House mulling restoring daily press briefing with Sanders replacement: report 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 PriceDemocrats constantly overlook conservative solutions to fix our broken health care Democrats constantly overlook conservative solutions to fix our broken health care Overnight Health Care: CEO of largest private health insurer slams 'Medicare for All' plans | Dem bill targets youth tobacco use | CVS fined over fake painkiller prescriptions | Trump, first lady to discuss opioid crisis at summit MORE and EPA Administrator Scott PruittEdward (Scott) Scott PruittTrump directs agencies to cut advisory boards by 'at least' one-third Trump directs agencies to cut advisory boards by 'at least' one-third Overnight Energy: Former EPA chiefs say Trump has abandoned agency's mission | Trump in Iowa touts ethanol and knocks Biden | Greens sue Trump over drilling safety rollbacks | FDA downplays worries over 'forever chemicals' MORE were forced to resign as a result of their own ethical lapses and other cabinet secretaries including Commerce Secretary Wilbur RossWilbur Louis RossDocuments suggest census official, GOP strategist discussed citizenship question: lawsuit Hillicon Valley: Tim Cook visits White House | House hearing grapples with deepfake threat | Bill, Melinda Gates launch lobbying group | Tech turns to K-Street in antitrust fight | Lawsuit poses major threat to T-Mobile, Sprint merger Hillicon Valley: Tim Cook visits White House | House hearing grapples with deepfake threat | Bill, Melinda Gates launch lobbying group | Tech turns to K-Street in antitrust fight | Lawsuit poses major threat to T-Mobile, Sprint merger MORE and Interior Secretary Ryan ZinkeRyan Keith ZinkeHouse Ethics panel reviewing allegations against Grijalva House Ethics panel reviewing allegations against Grijalva Federal watchdog recommends Conway be removed from role for Hatch Act violations 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.