CNBC News Transcripts April 13, 2004 Tuesday
Copyright 2004 CNBC, Inc.
CNBC News Transcripts
SHOW: Kudlow & Cramer (5:00 PM ET) - CNBC
April 13, 2004 Tuesday
HEADLINE: Representative Jim Cooper and Marjorie Powell from PhRMA debate the issue of pharmaceutical companies marketing drugs directly to consumers through advertisements
ANCHORS: JIM CRAMER; LARRY KUDLOW
JIM CRAMER, co-host:
Hot-button issue here. With more on marketing expensive drugs directly to consumers is Congressman Jim Cooper, Democrat from Tennessee, and Marjorie Powell with the Pharmaceutical Research & Manufacturers of America.
Congressman Cooper, we called you because I heard you at a CNBC function say that perhaps this advertising ought to come under the jurisdiction of Congress and maybe even laws need to be passed. You've got the floor.
Representative JIM COOPER (Democrat, Tennessee): Of course, the FDA used to have jurisdiction over this and at that time drug prices were only rising about 10 or 11 percent a year. Since the FDA has relaxed they're advertising regulations and you can pretty much advertise anything, now we have high-teens to low-20s price inflation for drugs. So I think that's a real concern because a lot of taxpayer dollars are involved here. We're really spending other people's money. And I think if you look at our US economy, the best description I've heard of our government is it's a giant insurance company that's about $72 trillion in the hole and most of that is health-care expenditures. We have to figure out a way to pay these bills, and exploding drug costs are one of the leading drivers of this.
LARRY KUDLOW, co-host:
Well, Ms. Powell, let me turn to you. I mean, to me, humbly, I think the pharmaceutical industry is a great business. It employs millions, it saves lives, it's the best in the world. And it's a free country. Why shouldn't they be allowed to advertise?
Ms. MARJORIE POWELL (Pharmaceutical Research & Manufacturers of America): Actually, there are-it's very important that pharmaceutical companies be allowed to advertise because the patients and physicians have to work together to find the best treatment for patients, but that only works when the patient actually gets into the doctor's office. A recent study by Harvard and the Harris survey people found that a quarter of the people who went to their doctor because they saw direct-to-consumer drug advertisement were diagnosed with a serious medical condition-diabetes, high blood pressure, high cholesterol-and getting them in to get appropriate treatment will in the long run save health-care costs.
CRAMER: Congressman Cooper, you heard Marjorie. It's clear that the ads that I see constantly running are educational. They're trying to tell you, 'Hey, you may have a problem you don't even know.' What's the matter with that?
Rep. COOPER: Well, I'm all for education. I think we need to educate more consumers and more doctors. I think there are efficient ways to do it and there are some inefficient and expensive ways to do it. I would urge us to be efficient because we have to guard every taxpayer dollar carefully. I'm worried when you see a drug like Nexium advertised, one of the most advertised drugs, even the former head of CMS said it was basically Prilosec painted purple with a price increase. How is that good medicine for the American people if the average patient thinks that they have to have Nexium, otherwise they're not going to be happy or successful? And most doctors know it's basically not what it's cracked up to be, not worth the price increase.