Thursday, January 07, 2010

Dorgan, Dodd and the New Democratic Math for Pharma

The big news in Washington is the unexpected retirements of two prominent Democratic Senators: Christopher Dodd of Connecticut and Byron Dorgan of North Dakota. Both changes have interesting implications for the biopharma industry, especially in light of the brand name trade association PhRMA's rapprochement with the Obama Administration on health care reform.

It is safe to say that a lot of pharma companies won't miss Dorgan (pictured), who has become the most dogged advocate of reimportation legislation in the Senate, first almost derailing the tobacco bill by trying to attach it, and then forcing a vote on the Senate floor in the context of the health care reform debate.

But be careful what you wish for: Dorgan's departure essentially assures that the North Dakota Senate seat will switch from D to R in 2011--and we don't think the pharmaceutical industry will be better off if the Republicans come to power in the wake of the health care reform debate. Republicans are seething over the fact that PhRMA cut a deal with the Obama Administration on reform; that's why so many voted to support Dorgan's amendment on reimportation. And, while Dorgan's likely successor--Gov. John Hoeven--hasn't been as strident as some border state governors on reimportation, he isn't likely to lead the opposition in 2011.

Dodd's departure, on the other hand, probably won't make anyone in the brandname industry happy. Dodd was one of few Democratic Senators industry could work with when the partisan alignment was different, thanks in part to the large Connecticut presence of Pfizer and several other pharmaceutical companies. In 2009, he has quietly been a key player in helping insure that the Senate live up to the PhRMA deal--including voting against Dorgan's reimporation amendment on the Senate floor.

And even if you still lean Republican, his departure assures that the Connecticut seat will remain in Democratic hands--specifically, in the hands of Democratic Attorney General Richard Blumenthal. As AG, Blumenthal supported reimportation legislation, pushed for legislation banning gifts to physicians, and--most recently--opened an investigation into "price gouging" for flu vaccines.

So, two Democratic departures probably adds up to a net gain of one seat for the Republicans and one loss for supporters of the PhRMA health care reform deal.

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