Companies which engage in scientific research should stay far away from the business of politics and influence peddling. It is expected companies which consistently rely on receiving government money will do anything to ensure the gravy train of federal appropriations is not interrupted. These companies with an interest in federal expenditures hire a team of lobbyists to shape and direct spending as well as influence government regulations in their favor or prevent them from happening in the first place. However, when these companies are engaged in scientific research, the American people should keep a close eye on the activities of their lobbyists. Science should remain as objective as possible, rather than getting into the dirty art of politics.
When applied to health care – a highly regulated and universal portion of American lives, it is important the government does not enable a monopoly, either on purpose or unintentionally, to control the American healthcare system or to raise costs for patients. However, sometimes, the government protects or creates a monopoly through cronyism and favoritism. Unlike what some believe, a large company is not inherently bad, but when the government takes actions to protect them from competition – that becomes a problem. Free markets are always better for everyone than a market where the government engages in crony capitalism and picks winners and losers and research companies are best when directing investments towards innovative products rather than securing government favors.
All the money and power amassed by the federal government has a corrupting influence. One of the biggest problems in D.C. are the army of lobbyists who occasionally enable cronyism and utilize government power to favor one company over another at the expense of the public. Law.com reported on January 27, 2022, the number of federal lobbyists has grown from 100 in the 1960s and to over 10,000 in 2022 and still growing. The amount corporate America is paying is astounding. The number reached four billion dollars in 2022.
A second area of concern is the impact lobbyists have on cronyism. The way the healthcare industry does business should be far different from the usual conduct of lobbyists and politicians because of the unique position it occupies. It is important policy makers utilize science-based decisions to better help their constituents concerning their healthcare and is kept far away from cronyism.
Some companies hire lawyers to take advantage of every law possible to benefit the company. There is nothing inherently wrong with having a large team of lawyers to craft regulations and lobbyists to petition the government for redress of grievances, yet it does become a problem when they are trying to game the system for their own benefit at the expense of others and preventing new products from gaining favorable market position, saving the government or patients money, or stifling innovation through cartel behavior.
Take for example the controversy over the merger between Illumina and Grail. CNBC reported on August 11, 2023, “the U.S. Securities and Exchange Commission is investigating Illumina over its controversial $7.1 billion acquisition of cancer test developer Grail, the DNA sequencing company said in a securities filing late Thursday.” The merger has faced significant opposition despite the massive expenditures to lobby for the merger being approved here in the U.S.
Companies sometimes get sidetracked and more concerned about lobbying than providing a product. Matt Stoller wrote in The Big Newsletter on June 15, 2023, “Though not a household name, it’s hard to overstate the importance of its products. Illumina, whose platform produces 90% of the world’s DNA data, has been at the center of the revolution in medicine derived from genetic technology. The DNA of COVID-19, for instance, was mapped just a few days after the virus was isolated, and it was sequenced on an Illumina machine.” Stoller argues that “but to speak of Illumina as if it is a medical technology firm underplays its real strength, which is as a political and legal influence peddling operation. Like a lot of important firms, Illumina’s business relies on proprietary technology, and so it wields the power of the state in the form of patents to maintain its market power. Unsurprisingly, it has been in constant litigation over patents.” Resources for litigation, lobbying, and other government influence, as opposed to innovation, are a waste of resources and a problem many big companies must address when they shift from their core mission to lobbying and lawyering.
It is important to wall off scientific research from politics and the games some companies play using lawyers in the legal system. Science needs to be free from politics or the government will slow advancements in healthcare technology because the free market is obstructed – hurting the healthcare system and in particular, patients.
Peter Mihalick is the former legislative director and counsel to former Reps. Barbara Comstock (R-VA) and Rodney Blum (R-IA).
