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 TrumpHouse Republican threatens to push for Rosenstein impeachment unless he testifies Judge suggests Trump’s tweet about Stormy Daniels was ‘hyperbole’ not defamation Rosenstein faces Trump showdown 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 WarrenCarbon tax could give liberals vast power to grow federal government Democrats opposed to Pelosi lack challenger to topple her More Massachusetts Voters Prefer Deval Patrick for President than Elizabeth Warren MORE (D-Mass.) and Tina SmithTina Flint SmithElection Countdown: Trump confident about midterms in Hill.TV interview | Kavanaugh controversy tests candidates | Sanders, Warren ponder if both can run | Super PACs spending big | Two states open general election voting Friday | Latest Senate polls Farm bill must protect working lands conservation programs Kavanaugh becomes September surprise for midterm candidates 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 HatchGOP opens door to holding Kavanaugh committee vote this week Press: Judge Kavanaugh must withdraw Hatch: Second Kavanaugh allegation is 'phony' MORE (R-Utah) and Rep. Greg WaldenGregory (Greg) Paul Walden13 states accepted Sessions invitation to meeting on social media bias: report House GOP blocks Trump-supported drug pricing provision from spending bill GOP turns its fire on Google MORE (R-Ore.) sent a letter to OMB Director Mick MulvaneyJohn (Mick) Michael MulvaneyProtect the Military Lending Act On The Money: Midterms to shake up House finance panel | Chamber chief says US not in trade war | Mulvaney moving CFPB unit out of DC | Conservatives frustrated over big spending bills Warren suggests Mulvaney broke law by speaking to GOP donors 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 PriceWhite House officials discussing potential replacements for FEMA chief: report Overnight Health Care: CBO finds bill delaying parts of ObamaCare costs B | Drug CEO defends 400 percent price hike | HHS declares health emergency ahead of hurricane HHS should look into Azar's close ties to the drug industry MORE and EPA Administrator Scott PruittEdward (Scott) Scott PruittTrump admin appeals ruling ordering EPA to ban pesticide Government watchdog probing EPA’s handling of Hurricane Harvey response Wheeler won’t stop America’s addiction to fossil fuels MORE were forced to resign as a result of their own ethical lapses and other cabinet secretaries including Commerce Secretary Wilbur RossWilbur Louis RossTrump team wildly underestimated the costs of tariffs The hot race for 5G will change the world we know now Wilbur Ross ordered to give deposition in 2020 census case: report MORE and Interior Secretary Ryan ZinkeRyan Keith ZinkeUS to approve import of black rhino killed in hunt Zinke must change direction and support conservation Energy development will likely land one bird on the Endangered Species list 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.