Prop. 78 May Suffer From Drug Makers' Poor Image

By Lisa Girion

Sept. 30, 2005 12 AM PT

Times Staff Writer

Californians like the idea of a statewide drug-discount program for the poor: A recent Field Poll found Proposition 78 leading by a healthy margin.

But that support sagged when respondents learned that the nation’s big drug makers were behind the initiative.

And therein lies the problem for supporters of the measure: Its biggest backer is also its biggest liability.

“Public opinion has a short list of bad guys, and the drug companies are on it,” said Jack Pitney, a government professor at Claremont McKenna College. “That can be hurtful to Proposition 78.”

The initiative would set up a state drug-discount program for low-income residents and give pharmaceutical companies the option to participate. A competing measure, Proposition 79, would set up a more extensive program and give the state power to punish drug makers that don’t join.

The trade organization spearheading the Proposition 78 campaign -- with more than $80 million in funding from Johnson & Johnson, Merck & Co., Pfizer Inc., GlaxoSmithKline and other drug companies -- prefers to focus on what the measure offers rather than problems caused by the industry’s image.

“Proposition 78 is not about the popularity of any one industry,” Ken Johnson, senior vice president of Pharmaceutical Research and Manufacturers of America, said in a statement. “It’s about good public policy and real-world solutions that will help people with their prescription drug costs.”

The public image of drug companies wasn’t always so low. In 1997, for instance, 79% of respondents in a poll by research firm Harris Interactive said drug companies did a good job serving consumers.

Seven years later, only 44% offered the same opinion.

The reason for the about-face: skyrocketing drug costs, and a corresponding rise in industry profits, issues at the heart of the rival ballot initiatives. U.S. spending on prescription drugs grew 214% from 1994 to 2004, according to a June report by the Center for Studying Health System Change. During the same period, profits at the top 10 U.S. drug companies grew 150% to $36.5 billion.

Drug company profits got most of the blame for rising healthcare costs in a 2004 poll by the Kaiser Family Foundation. Most consumers also believe that profits are the biggest component of prescription drug prices, according to a 2004 Harris Interactive poll.

Of nine big industries, only tobacco and oil companies were held in lower regard than pharmaceutical companies in a Kaiser public opinion poll conducted this year. Kaiser is not affiliated with healthcare provider Kaiser Permanente.

The decline in public opinion coincides with the period during which pharmaceutical companies have been advertising directly to consumers with television commercials and print ads pitching drugs as diverse as allergy pills and cures for erectile dysfunction.

Only 18% of adults polled this year by the Kaiser foundation said they trusted pharmaceutical advertising most of the time. That is down by almost half since 1997, when a third offered the same opinion.

“Once you start to become the butt of Jay Leno’s jokes,” said Kaiser spokesman Larry Levitt, “you know you are in trouble.”

At the same time, drug companies have been the target of a wave of lawsuits blaming prescription medications for patient deaths and injuries. Plaintiffs’ lawyers have succeeded at trial by using a company’s own marketing materials and drug trial data to portray it as putting profit ahead of safety.

Big pharmaceutical companies also suffer just because they are big, said David Stewart, a USC marketing professor. An industry consolidation has led to dominance by a few large multinational corporations -- a trend that typically alienates consumers.

“Any time things get framed as ‘big corporation versus the little guy,’ corporations get put in a bad position,” he said.

With this in mind, backers of rival initiative Proposition 79 have waged a guerrilla campaign this month at movie theaters around the state.

Showing up at some screenings of “The Constant Gardener,” a movie that casts a fictitious drug company as the villain, consumer advocates have handed out leaflets that attack pharmaceutical prices and profits.

They urge audience members to vote for Proposition 79 to “Stop the Constant Gouger” and call Proposition 78 a “smokescreen bankrolled by the prescription drug industry.”

Just how much the perceptions of the pharmaceutical industry at the box office -- and in the jury box -- matter at the ballot box depends on whether voters know about the role of drug companies in the election, political observers say.

The Field Poll in late August found that 49% of likely voters favored Proposition 78 and 31% were opposed. But only 13% were aware that it was supported by the pharmaceutical industry. And after being told this was the case, 44% said the information made them more likely to vote against it.

Because there are two drug discount measures at stake, voters are likely to be confused and inclined to be swayed by who is backing them, said Mark DiCamillo of the Field Poll.

“They sound very similar, so voters will be looking for those cues,” he said. “If there is a big ad campaign that tells people which side they are on, that would potentially have an effect.”

Previous ballot initiatives put forth by the insurance and tobacco industries failed even though their corporate backers outspent opponents by wide margins. What money the opposition groups had in those elections bought television ads that emphasized the industry ties.

Right now, the battle over drug discounts looks much like the tobacco and insurance initiative campaigns, with industry taking an early lead on spending and advertising, said Darry Sragow, a longtime Democratic political strategist.

At last count, the coalition supporting Proposition 79 and a slate of other initiatives had raised more than $10 million, a little more than one-tenth of what Proposition 78’s backers have collected, and it has done no television advertising.

In contrast, Proposition 78 “has been the beneficiary of an incredible amount of money, and that campaign went on the air weeks ago with a very clear message that 78 is good and 79 is bad,” Sragow said. “They went on early and they went on heavily because they know really well that when voters find out who they are, their support begins to diminish.”

The opposition commercials portray Proposition 79 as an unworkable plan that would inject government bureaucrats in the process of prescribing drugs. The commercials play on the same negative opinion, particularly strong among baby boomers, of big government that doomed Hillary Clinton’s healthcare overhaul proposal in the early 1990s, Sragow said.

The proponents of Proposition 78 “hope that people hate government bureaucracies more than they hate big corporations,” he said. “And 79 hopes that people hate big corporations more than they hate big government programs in healthcare.”

(BEGIN TEXT OF INFOBOX)

A study in contrasts

Likely voters favored both Propositions 78 and 79 in a late August Field Poll . . .

*--* Proposition 78 Proposition 79 Yes 49% 42% No 31 34 Undecided 20 24

*--*

. . .but many changed their minds after learning who is behind them:

After learning drug companies support Proposition 78

More likely to vote Yes: 19%

More likely to vote No: 44%

Other: 37%

After learning that consumer and labor groups support Proposition 79

More likely to vote Yes: 40%