A drug com­pany’s sick deal

The Washington Post Sunday - - SUNDAY OPINION - DAVID VON DREHLE david.von­drehle@wash­post.com

You know how a per­son with a leg cramp needs to walk it off ? News of Michael Cohen’s at­tempted trans­for­ma­tion last year from New York taxi medal­lion mer­chant to Washington wise man has given me a brain cramp, and I need to think it through.

Swiss phar­ma­ceu­ti­cal gi­ant No­var­tis hired Pres­i­dent Trump’s des­ig­nated porn-star si­lencer to “ad­vise the com­pany as to how the Trump ad­min­is­tra­tion might ap­proach cer­tain US health­care pol­icy mat­ters,” as the com­pany ex­plained in a very em­bar­rassed state­ment last week. Based on lit­tle more than the man’s boasts about his in­flu­ence, No­var­tis agreed to pay Cohen, Trump’s con­duit to al­leged lover Stormy Daniels, $1.2 mil­lion per year, in 12 monthly in­stall­ments.

Earth to Belt­way: That num­ber might not shock you, with your $100 lunches and $30,000-a-year preschools, but that’s a truck­load of let­tuce to Ma and Pa Amer­ica.

No­var­tis dis­cov­ered almost im­me­di­ately that Cohen had not the slight­est idea how the Trump ad­min­is­tra­tion might ap­proach health-care pol­icy. De­spite his sup­posed ac­cess to the new pres­i­dent, ev­i­dently the topic had not come up.

Now, you can’t blame Cohen for this, be­cause can­di­date Trump never had a health-care pol­icy. He had a cou­ple of health-care slo­gans. “I am going to take care of ev­ery­body,” for ex­am­ple. But in terms of de­tails: The man was a beauty-pageant pro­moter, for heaven’s sake. If health care had ranked high among his in­ter­ests, the in­ter­view por­tion of the Miss Uni­verse com­pe­ti­tion would have been quite dif­fer­ent.

EMCEE: Miss Ro­ma­nia, tell us in your own words how you would pro­mote ac­count­able care or­ga­ni­za­tions if you should wear the crown?

No­var­tis chief ex­ec­u­tive Vas­ant Narasimhan called the deal “a mis­take” in a memo to com­pany em­ploy­ees. AT&T chief ex­ec­u­tive Ran­dall Stephen­son struck the same note in apol­o­giz­ing for his com­pany’s $600,000 ar­range­ment with Cohen, call­ing it “a big mis­take” and say­ing the com­pany’s head of lob­by­ing would be re­tir­ing. So far, Colum­bus Nova, an in­vest­ment firm with close ties to a Rus­sian oli­garch, has not apol­o­gized for — or ex­plained — the half-mil it re­port­edly lav­ished on Trump’s fixer.

What I find strik­ing is that, even af­ter Cohen’s in­com­pe­tence was ap­par­ent, No­var­tis kept send­ing those monthly $100,000 checks. The com­pany says the lawyer’s fail­ure to de­liver on his prom­ises was not grounds for void­ing the con­tract. Ad­mit­tedly, if lack of re­sults ever be­comes pun­ish­able in Washington, the cap­i­tal’s econ­omy could seize up like a jet en­gine plow­ing through a flock of snow geese.

Still, there’s some­thing very New York, or maybe New Jersey, about this sce­nario. If Cohen could not help No­var­tis, com­pany brass may have rea­soned that he could be in a po­si­tion to hurt No­var­tis by putting a poi­soned word in the pres­i­dent’s fickle ear. So it was safer and eas­ier for No­var­tis to pay up. In the world where Cohen and Trump have kept com­pany for years, the world of failed casi­nos and lux­ury con­dos bought with un­trace­able cash, it’s not un­heard of for a com­mer­cial en­ter­prise to pay monthly re­mit­tances to in­di­vid­u­als with, shall we say, con­nec­tions.

That’s a real nice multi­na­tional phar­ma­ceu­ti­cal cor­po­ra­tion you got there. Sure would be a shame if some­thing bad hap­pened to it . . .

Per­haps you are won­der­ing why a com­pany based in Basel, Switzer­land, needed $1.2 mil­lion worth of good will among the col­or­ful cast of char­ac­ters on Team Trump. And why that com­pany rushed to sign such a lu­cra­tive lob­by­ing con­tract with­out per­form­ing even min­i­mal due dili­gence.

For that amount of money, I could have given the com­pany a fool­proof way to cap­ture the pres­i­dent’s heart. Just put Narasimhan on CNBC and have him say, “Now that Don­ald Trump is in the White House, we’re prob­a­bly going to cure can­cer!” Next stop, Lin­coln Bed­room.

But the cold truth is that a mil­lion bucks is pocket lint com­pared with the sweet­heart deal that com­pa­nies such as No­var­tis have al­ready en­gi­neered in the United States. A law pre­vents Amer­ica’s largest health-in­sur­ance en­tity, Medi­care, from ne­go­ti­at­ing lower pre­scrip­tion drug prices. That’s a big part of the rea­son drugs in the United States cost far more than the same com­pounds pre­scribed in other Western coun­tries.

Drug pric­ing in the United States is badly bro­ken. For ex­am­ple, a study pub­lished in the jour­nal Neu­rol­ogy found that treat­ments for mul­ti­ple scle­ro­sis, a field in which No­var­tis is a ma­jor player, have sky­rock­eted de­spite in­creased com­pe­ti­tion, thanks to “a seem­ingly dys­func­tional mar­ket­place where ex­panded choice has led to higher, rather than lower, prices.”

On Fri­day, Trump un­veiled his long­promised plan to tame pre­scrip­tion prices, and guess what? The ban on Medi­care ne­go­ti­a­tion, which can­di­date Trump promised to end, re­mains in­tact. Ev­i­dently some of the in­dus­try’s lob­by­ing dol­lars were spent more ef­fec­tively than oth­ers.

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