Labor Unions Team Up With Drug Makers to Defeat Drug-Price Proposals – The New York Times

A low-profile group, financed by the pharmaceutical industry, has hired former union officials to oppose drug-price proposals around the country.

House Speaker Nancy Pelosi introduced a prescription drug cost bill on Capitol Hill in September.Credit…Anna Moneymaker/The New York Times

House Speaker Nancy Pelosi’s bill to lower drug prices has the backing of many of the nation’s biggest labor groups, including the United Auto Workers, the A.F.L.-C.I.O., and unions representing teachers and other government workers.

But a wave of Facebook ads that ran this fall appeared to suggest otherwise. The ads, featuring a dejected-looking man in a hard hat, warned that the bill “threatens thousands of good-paying jobs and restricts access to lifesaving medication.”

The ads were paid for by a little-known group, the Pharmaceutical Industry Labor-Management Association, that is trying to defeat drug-pricing proposals around the country, from statehouses in Nevada, Maryland and Oregon to Congress. The Facebook ads targeted 15 recently elected Democrats in Congress, including Harley Rouda of California and Andy Kim of New Jersey.

The group, a coalition that includes major drugmakers like Pfizer and Johnson & Johnson as well as large construction-industry unions whose members help build pharmaceutical plants and research labs, has been buying print advertisements in local newspapers, mailing fliers to voters in vulnerable Democratic districts, and hiring former labor officials and well-known union lobbyists to deliver their message. It aligns closely with the talking points of drug companies, which claim that Ms. Pelosi’s bill would stifle innovation and damage a vital American industry.

Even in the nation’s capital, where coalitions and dark-money groups are routinely used to repackage corporate interests in a more sympathetic light, the pairing of the drug industry and unions is an unusual one. Many unions, including some who are members of Pilma, help oversee their workers’ health plans and have an interest in lowering drug costs. And out-of-pocket costs for prescription drugs are a financial strain on many Americans, including union members.

“It’s really odd,” said Representative Rob Nosse, a Democratic Oregon lawmaker who helped pass a drug-pricing transparency bill in 2018. Pilma, which opposes transparency bills, contending they expose proprietary information, hired the former political director of the regional chapter of the International Brotherhood of Electrical Workers to lobby for the group. Mr. Nosse said that he was surprised the unions’ health care experts didn’t “tell them, you know what’s killing our health insurance? The cost of medications.”

The drug companies who are members either did not respond, or declined to comment.

Tim Dickson, the executive director of Pilma, said the group’s position was aimed at creating jobs for union workers. “We place a premium on the partnership that yields jobs,” he said. “And we have a longstanding position that we’ve held for quite some time that certain policies, such as price controls, will have a negative effect on union construction jobs.”

Ms. Pelosi’s bill would require the federal government to negotiate the prices of insulin and as many as 250 other high-priced drugs on behalf of Medicare, and impose financial penalties if companies failed to comply.

Although the bill is seen as unlikely to become law in its current form — Senator Mitch McConnell, Republican of Kentucky and the majority leader, has come out against it, as has the Trump administration — the drug industry has fought hard against it. Its main lobbying group, the Pharmaceutical Research and Manufacturers of America, has called the bill “devastating,” and said it would lead to fewer new drugs coming to market.

Some of the bill’s biggest backers are labor groups, including the national A.F.L.-C.I.O., some of whose members are part of Pilma. A spokesman for the federation declined to comment beyond pointing a reporter to its position supporting Ms. Pelosi’s bill.

Other unions that support efforts to lower drug costs avoided criticizing labor groups, either declining to comment or choosing their words carefully. “National Nurses United is really focused on the real culprits behind these outrageous drug prices, which is the pharmaceutical industry specifically,” said Amirah Sequeira, the lead legislative advocate for the nurses union, which has not yet supported Ms. Pelosi’s bill because it believes it does not go far enough in lowering costs.

In addition to Facebook ads, Pilma also mailed fliers to voters in swing districts like Mr. Kim’s in New Jersey, a state where the pharmaceutical industry plays a major role in the economy. The mailing warned that Ms. Pelosi’s bill would jeopardize 54,000 jobs in the state and would “risk access to critical medicines.”

Mr. Kim’s office declined to comment.

Among Pilma’s members are unions that represent a range of building trades involved in manufacturing plants for pharmaceuticals, like sheet metal and iron workers, electrical workers, and plumbers and pipe-fitters. The International Union of Police Associations and the International Association of Fire Fighters are also members. According to Pilma, the pharmaceutical industry is responsible for 4.7 million jobs in the United States, including many highly skilled union jobs.

A spokesman for the International Association of Sheet Metal, Air, Rail and Transportation Workers, whose president, Joseph Sellers, Jr., is chair of Pilma, said that while the union supported expanding access to prescription drugs, it also relied on companies like drug makers to provide good-paying jobs. “Without jobs to fund them, there are no health care plans in the first place,” said the spokesman, Paul Pimentel.

One of Pilma’s members, the International Brotherhood of Boilermakers, has been outspoken about its struggle to contain high drug prices — one family covered by its health plan requires a drug that costs about $1.5 million a year per person.

John T. Fultz, the international vice president for the Northeast States Section of the International Brotherhood of Boilermakers, declined to comment on the union’s membership in Pilma but said that drug prices were a major concern. He is also the secretary of the boilermakers’ health and welfare fund, which oversees benefits along with the workers’ employers.

“Our concern is drug pricing, so we can afford the medications that our members need,” Mr. Fultz said. If the cost of high-priced specialty drugs is not reined in, “it will eventually break many plans.”

Alexander Hertel-Fernandez, an assistant professor of international and public affairs at Columbia University, said unions that form corporate alliances can wield considerable influence. Others said groups like Pilma can contribute to a broader sense that taking sides on a thorny issue like drug prices carries political risks.

“Union-management coalitions have been successful in the past in pressuring Democrats to moderate their policy agenda, especially on climate and environmental legislation,” Mr. Hertel-Fernandez said in an email. “When Democrats are hearing from powerful corporate interests and labor interests, it’s harder for them to resist.”

Pilma has had federal tax-exempt status since 2004 as a business association and is run out of the offices of a public relations firm, Groundswell Communications. Its executive director, Mr. Dickson, is the owner of Groundswell and a longtime grass-roots organizer for Democrats. Pilma had revenues of about $2.3 million in 2018, according to federal tax documents. Mr. Dickson said the pharmaceutical industry supplied the group’s revenues, which he said was standard practice for coalitions between industry and unions.

Union activists are the group’s public face. Pilma has spent $465,000 on federal lobbying in the first three quarters of this year, according to the Center for Responsive Politics, and most of its lobbyists are former labor officials or have clients that include other unions.

Pilma’s positions hew closely to the views of the pharmaceutical industry. Pilma also opposes more moderate, bipartisan proposals like the one put forward this year by Senators Chuck Grassley, Republican of Iowa, and Ron Wyden, Democrat of Oregon. It has also come out against a Trump administration proposal that would allow more importation of drugs from Canada and other countries.

Mr. Dickson noted that the group had also supported laws favored by unions, such as one recently signed into law in Nevada, strengthening prevailing wage requirements for public construction projects.

In 2017, when Nevada lawmakers were working on a bill to require drug makers to disclose insulin prices, Pilma hired Danny Thompson, who had just retired as head of the state A.F.L.-C.I.O., to work on its behalf. The group’s presence generated some tension in the local labor world. The Nevada A.F.L.-C.I.O. wrote in a tweet that Pilma “doesn’t speak for NV labor, we do!”

“I was very surprised,” said Yvanna D. Cancela, a state senator. Ms. Cancela, who is the former political director of the state’s largest union, the Culinary Workers Union, said her insulin bill had the support of most of the state’s biggest unions and ultimately became law. Still, she said, “it was an unexpected alliance.” Mr. Thompson did not return calls for comment.

In Maryland, Pilma neutralized some of the union support for a bill — which has since become law — that created a board that can limit payments for drugs on behalf of public sector employees. The state’s A.F.L.-C.I.O. did not take a position on the bill because Pilma and some individual unions opposed it, said Donna S. Edwards, the federation’s state president. “If we have one union that is not on board with a decision, then we’re neutral,” she said.

“We had hopes that A.F.L.-C.I.O. would endorse this right away,” as other unions did, said Vincent DeMarco, the president of the Maryland Citizen’s Health Initiative. “And then we saw that they were getting pushback from this Pilma group.”

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