The pharmaceutical lobby, also known as big pharma or the drug lobby, refers to the representatives of large pharmaceutical and biomedicine companies who seek to influence governments, the media and other institutions in favour of the pharmaceutical industry and its products.
Critics of the pharmaceutical lobby argue that the drug industry's influence allows it to promote legislation friendly to drug manufacturers at the expense of patients. The lobby's influence in securing the passage of the Medicare Prescription Drug Improvement and Modernization Act of 2003 was considered a major and controversial victory for the industry, as it prevents the government from directly negotiating prices with drug companies who provide those prescription drugs covered by Medicare. Price negotiations are instead conducted between manufacturers and the pharmacy benefit managers providing Medicare Part D benefits under contract with Medicare. In 2010 the Congressional Budget Office estimated the average discount negotiated by pharmacy benefit managers at 14%.
The high price of U.S. prescription drugs has been a source of ongoing controversy. Corporations state that the high costs are the result of pricey research and development programs. Critics emphasize the industry's profits and the high proportion of pharmaceutical budgets devoted to marketing and lobbying. According to Marcia Angell, the former head of the New England Journal of Medicine, "The United States is the only advanced country that permits the pharmaceutical industry to charge exactly what the market will bear." In contrast, the RAND Corporation and authors from the National Bureau of Economic Research have argued that price controls stifle innovation and are economically counterproductive in the long term.
According to the statistics of the EU Transparency Register, spending on lobbying activities in the pharmaceutical industry in the European Union exceeds EUR 40 million a year. Nearly half of this budget is spent on local lobbyists, whose goal is to influence key decision makers. The rest supports e.g. social campaigns, patients' organisations, or medical professional societies. At the same time, many pharmaceutical companies fail to declare their activities to the EU Transparency Register. It is estimated that, if recorded in total, the expenditures would amount to the level of approx. EUR 90 million. [unreliable source?]