[Congressional Record (Bound Edition), Volume 148 (2002), Part 10]
[SE]
[Pages 13025-13049]
[From the U.S. Government Publishing Office, www.gpo.gov]




  GREATER ACCESS TO AFFORDABLE PHARMACEUTICALS ACT OF 2001--MOTION TO 
                           PROCEED--Continued

  The PRESIDING OFFICER. The Senator from Florida.
  Mr. GRAHAM. What is the parliamentary position of the Senate?
  The PRESIDING OFFICER. The Senate is considering a motion to proceed 
on S. 812.
  Mr. GRAHAM. Mr. President, I am going to talk about one of the issues 
which will be a central part of the next several days' debate on 
American health care. The specific bill before us upon which we are 
seeking permission to proceed relates to generic drugs and eliminating 
some of the legalisms which have grown up around our generic drug law 
and have made it difficult for competitive products to come to market, 
even after the brand name drug has run the full course of its patent. 
That will be a debate for another day, hopefully as early as today.
  I am going to talk about an issue that will come up somewhat later in 
this debate and that is adding a prescription drug benefit to Medicare.
  Some would say: Look, this issue has been around for a long time. Why 
should we continue to spend time debating a matter which has thus far 
been unable to find enough support in the Congress to become law? Why 
is this issue important enough for us to spend time on it?
  The answer is: Freda Moss. That is why this is an important issue.
  In Tampa, FL, Freda Moss, an 80-year-old American, along with her 84-
year-old husband Coleman, is watching this, and so are thousands like 
Freda and Coleman. They are also watching us.

[[Page 13026]]

  Freda is watching and waiting to see if we can improve her life and 
the lives of 39 million Americans by adding a prescription drug benefit 
to the Medicare Program. The story of Freda and Coleman is typical of 
many older Americans. They live on Social Security with an income of 
$1,038 a month. They are both eligible for Medicare. They have no 
prescription drug coverage.
  While Coleman has remained healthy and has relatively low 
prescription drug costs, unfortunately, Freda suffers from diabetes, 
heart disease, and hypertension. Freda is on a list of prescription 
drugs that include Plavix, Mavik, Amaryl, and Zocor. In 1 year alone, 
Freda's prescription drug costs were nearly $7,800--62 percent of that 
couple's total income. It is for people like Freda that we need to add 
a prescription drug benefit to Medicare.
  As more and more Americans discover the effectiveness of prescription 
drugs in promoting longer and healthier lives, they have become an 
indispensable part of our health care system. In 1980, prescription 
drugs accounted for less than 5 percent of national spending on health 
care. In 1980, less than 5 percent. Twenty years later, in 2000, 
prescription drug costs accounted for nearly 10 percent of national 
spending on health care. It is estimated in the year 2010 prescription 
drugs will reach 14 percent of total health care costs.
  Last year, 20 percent of the increase in the total cost of health 
care came from increases in the cost of prescription drugs. Even though 
they were only 10 percent of all costs, they were 20 percent of the 
increase in cost.
  As there has been in the last few years, there will be a lot of 
debate over the next few days about the many measures that will be 
introduced to conquer the problems in the prescription drug market. 
While many of these proposals are important and even useful to seniors, 
the ultimate goal must be a prescription drug benefit for older 
Americans. For many years we have come to the Senate floor to talk 
about how important this is. Others, beyond Freda, have been used as an 
example of the urgency of action, but every year we have gone home we 
have spoken to our constituents about how committed we were, how hard 
we worked to accomplish the objective of passing a prescription drug 
benefit but that we had failed.
  Now is the time to overcome failure with victory. We can pass this 
year--we must pass this year--a benefit for our older citizens who are 
looking to us for the protection of their health care.
  I appeal to all of you who have heard stories such as that of Freda 
Moss to join me in providing a prescription drug benefit for Medicare.
  Why doesn't Medicare, established in 1965 and which covers 39 million 
people, provide a prescription drug benefit? Virtually every other 
health care plan, the kind of plan that the Presiding Officer, myself, 
and other 98 colleagues have, provides a prescription drug benefit as 
part of a total health care program. Why doesn't Medicare?
  The answer is basically history and inertial. In 1965, when the 
Medicare Program was founded, prescription drugs were a very small part 
of health care. Few drugs were used by the very ill. Can you believe 
this? In the year Medicare was established, in 1965, the average 
spending for prescription drugs by older Americans was $65. That is not 
$65 a week or $65 a month. That is $65 a year was the average amount 
expended by older Americans on prescription drugs when Medicare was 
established.
  What is the number today? According to the Congressional Budget 
Office, spending over the 37 years, from 1965 to today, has risen to an 
average of $2,149. That is a 35-times increase in the cost, on an 
annual basis, of prescription drugs for older Americans.
  If the Medicare Program were to be designed today, in 2002, there 
would be no question that lawmakers would include a prescription drug 
benefit. Why? Not only because every other health care plan, the plans 
that most people have gotten accustomed to during their working lives, 
have long included a prescription drug benefit, but also because 
prescription drugs today are an integral part of a modern health care 
program.
  Medications are used not only to halt the effects of a disease, but 
in many cases can even reverse the negative consequences of disease. 
After 37 years, it is unfair to ask our Nation's older citizens, one of 
the most vulnerable populations in our society, to continue to go 
without the Medicare Program offering coverage for the necessity of 
modern health care, prescription drugs. Everyone in this Chamber 
receives this benefit as a Federal employee. We should demand nothing 
less for our older citizens.
  How do we solve the problem? I suggest there are a set of principles 
that we should look to as we shape a response to this problem of the 
missing benefit of prescription drugs for older Americans.
  The first principle is modernization of the Medicare Program. We will 
hear, have heard, and until this debate is concluded will continue to 
hear, about reform in the Medicare system. There are lots of things we 
ought to do to reform the Medicare system. Many of those things that 
are referred to as reform are not unimportant but they tend to deal 
with the mechanics of the Medicare Program. We should ratchet up or 
down a deductible. We should change an amount of coinsurance that is 
required--alterations such as that.
  In my judgment, the most fundamental reform that we can make to the 
Medicare Program is precisely what we are recommending today, and that 
is to add a prescription drug benefit. Why is this the most fundamental 
reform? Medicare today is, as it was in 1965, a ``sickness'' system. If 
you get sick enough to have to go to the doctor, or even sicker and 
have to go to the hospital, Medicare will come forward and pay a 
significant part of your bill. On average, about 77 percent of the cost 
of physicians' assistance or hospitalization will be paid by the 
Medicare Program. What Medicare does not pay for is very much 
prevention, those things that we know will help keep you well and avoid 
the necessity of having to go to the doctor or the hospital.
  It doesn't pay a dime towards the prescription drugs that you will 
purchase at your local pharmacy or by mail order, which for almost 
every one of those prevention methodologies is an absolute fundamental 
aspect.
  For example, suppose you have developed an ulcer. The treatment for 
that in the past was pretty straightforward. You had an operation and 
the ulcer was dealt with surgically. Today, ulcer surgery is virtually 
like the dinosaur, an animal of the past.
  We have had the good fortune of having in our office for the last 
several months Dr. Howard Forman. He is a professor of medicine at Yale 
Medical School. He says that a simple 6-week course of drug therapy 
today can avoid the $20,000 cost of hospitalization for ulcer surgery. 
Even drugs such as Timolol, a generic heart drug, is estimated to save 
$4,000 to $7,500 per year per patient in select heart attack victims.
  Drugs to lower cholesterol and to control hypertension can ward off 
possible stroke or heart attack--medical conditions that not only 
reduce the quality of life but are very costly for treatment through 
the traditional Medicare Program.
  Modern medicine has been significantly altered by prescription drugs, 
notably by improving the quality of people's lives, reducing long 
recovery periods, and sometimes even negating the need for surgeries 
altogether, as in the instance of ulcers. This is why our seniors need 
a universal, affordable, accessible, and comprehensive drug benefit.
  The second principle behind the addition of a prescription drug 
benefit is to provide beneficiaries with a real and meaningful benefit. 
An important part of assuring that a prescription drug program will be 
around for our children and grandchildren is to attract a broad variety 
of beneficiaries.
  Mr. President, you know as I do that a fundamental principle of any 
insurance plan is to get a broad base of people participating, knowing 
that some of those people will suffer whatever it is they are insuring 
against--like their house burning down or their car being

[[Page 13027]]

involved in an accident--and other people will be fortunate enough to 
avoid those instances. It is having enough people in the pool who can 
all share the cost that then allows us to rebuild the home that has 
been destroyed by fire.
  Because this program is voluntary, and because it is critical that it 
attract a broad base of participation, it must have a reasonable price 
and a benefit package that will make it attractive to those older 
Americans who are relatively well today and who do not have large 
prescription drug bills. By attracting both seniors with high needs and 
those who simply need modest coverage and would like to be assured that 
should they suffer a heart attack or some other disabling condition 
they will be able to access the catastrophic coverage, that is the 
coverage that will give them full protection for prescription drugs 
beyond a certain point. This program will be solid. This program will 
be actuarially sound for our and future generations.
  Any prescription drug plan must offer seniors coverage that begins 
from the first prescription bill; that is, no deductible standing in 
the way of getting benefits. Seniors should understand that if they are 
receiving a benefit, the benefit should be consistent, and seniors 
should actually receive it without any gaps in coverage. That is a so-
called doughnut profit where you have coverage for a certain proportion 
of your drug expenditures and then all of a sudden you are 100-percent 
responsible until you reach the catastrophic level.
  In order to make this program easy for seniors, it should operate in 
a way as similar as possible to the coverage that seniors had during 
their working life.
  A third principle is that seniors should have choice. America as a 
nation thrives on choice. Choice is an important part of health 
decisions. Choice is an important part of creating a competitive 
environment that will assist in controlling costs. Our seniors deserve 
a choice in who delivers their prescription drugs, which is why we must 
assure that each region of the country has multiple providers of 
prescription drug benefits.
  This will encourage competition, helping to keep costs down to 
beneficiaries as well as to the Medicare Program and ultimately to the 
American taxpayer. The choice of who you select to deliver your drugs 
should be made by seniors beginning with the position as to which firm 
you wish to be your representative. The phrase is a pharmacy benefit 
manager, or a BPM, and then which specific drugstore you want to go to 
have your prescriptions filled or should you choose to use a mail order 
form of description. Those ought to be choice decisions made by the 
individual senior American who we will treat with respect and dignity.
  Fourth, we need to use a delivery system on which seniors can rely. 
American seniors deserve a delivery system for prescription drug 
benefits that is based on something tried and true, consistent with 
what seniors feel comfortable with, and modeled on what has already 
worked. We should not convert our 39 million older Americans into some 
giant new social health policy on how to deliver a product as critical 
and as basic as prescription drugs when there are already models on how 
to deliver prescription drugs with which seniors are familiar and which 
are working well.
  Medical beneficiaries should not be led into being guinea pigs for 
social experimentation. If we are going to spend billions of taxpayer 
dollars on a prescription drug program, it should not be handled with 
untried and untested delivery models. We are responsible to the 
American taxpayers to invest in what we know will work. We should look 
at what the private sector does for guidance in developing a delivery 
system for a drug benefit and evaluate what is already effective for 
beneficiaries so they can help us better understand what will work for 
seniors.
  The fifth principle is to provide an affordable program for 
beneficiaries. The majority of seniors in America live on fixed 
incomes. They need to know the cost of those things in order to be able 
to budget. This is why seniors need a prescription drug benefit that is 
affordable with a low premium and low copayments that are easy to 
calculate. They need to be assured against wild variations from month 
to month, or year to year. The program must also make financial sense 
to beneficiaries. Seniors should not have to wait until an emergency 
arises before the benefit is worthwhile.
  We know that when seniors do not have coverage, they do not fill 
their prescriptions, a practice we hope to eliminate with this 
legislation. The gap in coverage means no coverage for many elderly who 
might be caught in this doughnut of noncoverage. It means that not only 
will they be unable to buy their prescriptions during that period, but 
it might discourage them from engaging in the preventive practices of 
asking the very legitimate question: What is the good of my starting on 
an expensive drug that will help control my hypertension if 4 months 
from now I am going to be in a position where I will no longer have any 
coverage and assistance to buy the drug that I can take home, so I will 
never start and get the benefits of that preventive treatment?
  Cost will be a factor in order to maximize enrollment. We have been 
advised by a number of organizations that represent the interests of 
older Americans, such as AARP, that a premium in the range of $25 a 
month is a premium which will be able to attract broad participation by 
older Americans. In order for this program to be solid, we need to have 
that broad participation.
  Sixth, this must be a fiscally prudent program. We have a 
responsibility as lawmakers to pass the budget and to maintain fiscal 
discipline. We must exercise this judgment when we look at all 
spending. And the case of prescription drugs should be no different.
  That being said, we must look at prescription drug coverage in the 
context of other benefit programs. As I mentioned earlier, Medicare 
currently covers 77 percent of the total expenses of those services 
which are Medicare covered. If you go to the hospital to have an 
appendectomy or if you go to your local doctor for an outpatient 
procedure, on average, Medicare will pay 77 percent of the cost.
  Prescription drugs are as important to seniors as the services which 
are currently covered under Medicare. If we were to cover 77 percent of 
drug expenses, as we do for current Medicare services, we would be 
spending over $1 trillion in the next 10 years to provide this benefit.
  If we look at the drug coverage that those of us in this Chamber 
receive through the Federal Employees Health Benefits Program, if our 
seniors were to get the same level of Federal support for their 
prescription drugs as we, as Senators, get for ours through the same 
Federal Treasury, it would cost between $750 and $800 billion over 10 
years to provide that coverage.
  These numbers provide a context. Clearly, we will have to find a 
balance between giving seniors what they need and what the budget will 
allow, and what type of benefit will have the most use for Medicare 
beneficiaries.
  I would like to briefly outline some of the details of the plan that 
will be introduced later this week on behalf of myself, Senator Miller, 
Senator Kennedy, Senator Cleland, and a number of other colleagues. 
That plan would begin by asking the seniors, in a dignified way: Do you 
want to participate at all? It is your choice. This is a voluntary 
program.
  If seniors say, Yes, I do want to participate, here is what they will 
get. First, they will get a bill for $25 a month. That is the cost of 
the premium to be a participant in this plan. Once they have made that 
$25 payment, then they will become eligible to participate. They will 
be eligible from the first dollar they expend after they join the plan; 
that is, there is no deductible.
  Once they begin to acquire their prescription drugs, they will find a 
system very similar to what they used during their active years. They 
will make a copayment for each prescription they receive. We are 
suggesting that copayment should be $10 for each generic prescription 
and $40 for each brand name, medically necessary prescription.

[[Page 13028]]

  Once you had expended $4,000 out of your pocket for prescription 
drugs, you would reach the level of catastrophic, and beyond that 
$4,000 from your pocket there would be no further copayments required.
  Seniors with incomes below 135 percent of poverty would pay no 
premiums. Beneficiaries with incomes between 135 and 150 percent of 
poverty would pay reduced premiums.
  Our plan uses the exact delivery model that America's private 
insurance companies utilize. It is also the same model the Federal 
Employees Health Benefits Plan utilizes which covers virtually, if not 
totally, all of our colleagues in this Chamber.
  Every Federal employee health benefit plan uses pharmacy benefit 
managers, or PBMs, as the method of delivering and managing 
prescription drug benefits. PBMs are private, commercial companies that 
negotiate directly with pharmaceutical companies to achieve low prices. 
They are held accountable. Part of their fee to provide this service is 
based on their demonstrated capacity to contain costs and to provide 
quality care and service.
  We would allow all seniors a choice of which PBM they wish to use by 
giving the seniors the opportunity to shop around for a plan that best 
meets their needs. PBMs would be accountable to the Medicare Program 
and to the taxpayers.
  PBMs would be required to demonstrate their ability to keep drug 
costs down in order to be awarded a contract to seek to represent 
seniors. Further, once the PBM had the contract, they would not be paid 
for their services if they did not carry out their commitment to 
contain drug spending while, at the same time, providing a quality 
service to older Americans.
  Our plan is estimated to cost less than $500 billion through the year 
2010. We are suggesting that in that year, 2010, Congress should pause, 
Congress should review this plan that will now have been in effect for 
7 years, and the Congress should decide what we have learned during 
this period, much as we are doing now as we reauthorize the welfare-to-
work law. We are looking at what we have learned since 1996. And we are 
going to put that learning into the welfare-to-work law for the next 
period.
  In my judgment, in light of the significance of this new program, it 
will be highly appropriate to examine how well the benefit is working 
and whether it is providing seniors with the benefits they need. Is it 
living up to those six principles I just outlined, which should be the 
cornerstone of an effective prescription drug program? We can learn 
from these first 7 years and apply those lessons to the future.
  As I indicated earlier, this is not the only plan the Congress is 
considering. In fact, the House of Representatives has already passed a 
prescription drug plan. That will be awaiting our action in a 
conference committee, hopefully in the next few days, to begin the 
process of trying to arrive at an appropriate compromise. I would like 
to make a few comments about the House Republican plan which has passed 
and awaits that conference committee.
  Providing a legitimate drug benefit that would actually help 
America's seniors is our goal on the Senate floor. In my judgment, the 
proposal passed by the House of Representatives almost 3 weeks ago 
fails to give Medicare beneficiaries what they need and deserve: an 
affordable, reliable, comprehensive, and accessible prescription drug 
benefit.
  Unfortunately, the proposal that apparently is going to be offered by 
the Senate Republicans suffers from the same defects as that from the 
House Republicans. If a comparison is made between the House Republican 
plan, the Senate Republican plan, and the six principles I have just 
outlined, only one of the six criteria for a prescription drug benefit 
is met.
  After many years, my colleagues on the other side of the aisle have 
finally come to recognize the basic need for a prescription drug 
benefit. The problems include the lack of a defined benefit. Seniors 
will not know, under either the House or Senate Republican plans, what 
they will get. Another problem is control is turned over to private 
insurance companies to determine what the senior will receive. And an 
additional problem is the money beneficiaries are expected to spend 
before they actually receive benefits.
  The House Republican proposal fails to provide Medicare recipients 
with a stable, sustainable benefit. It would allow insurance companies 
to decide what type of coverage would be offered since the House 
legislation only requires that there be an ``actuarial equivalent'' of 
the basic benefits plan.
  This means we have no idea what type of benefits would be offered to 
seniors. We do not really know what the premium is.
  I have looked through all 426 pages of the House Republican bill, and 
I was unable to find a real hard number that guaranteed what seniors 
would pay every month as their premium responsibility. Although I have 
not looked through the Senate Republican bill, which was just offered 
yesterday, I suspect it is no different.
  The House Republican bill could mean a $250 deductible or it could 
mean a deductible as high as $1,000. This means there would be a 
substantial delay between the time the senior signed up for the plan 
and when they would start getting any benefit. There is nothing 
reliable about this plan.
  The bottom line is that America's seniors would be at risk for wild 
variations in the type of benefits they would have from place to place 
in America and from year to year in the same place.
  For the first time in the history of Medicare, seniors, for instance, 
in Florida would pay a different premium than seniors in Georgia or 
seniors in Massachusetts. In both Republican plans insurance companies 
make all the decisions, have all the choices--not the Medicare 
beneficiary. These companies would be lured with taxpayers' dollars 
into a market in which they do not wish to participate in order to 
create a complex delivery system that does not currently exist.
  There is an organization that represents a number of large 
pharmaceutical companies which has been a principal advocate of the 
House Republican plan. I met some time ago with a number of 
representatives of that association. After they had given me the 
explanation of why they were supporting this plan that requires seniors 
to purchase private insurance with unstable and uncertain benefit 
structures, I then asked them this question: How do your employees, the 
people who work for your pharmaceutical company, including you as an 
executive, how do you get your prescription drug benefits?
  Do you know what the answer to the question was? Exactly the way that 
we are proposing in our legislation. They don't use this system of a 
private insurance policy for drug only for themselves or their own 
employees. They want 39 million American seniors to become the first 
farm of guinea pigs for this experimentation on how to deliver 
prescription drugs, when we know how to deliver prescription drugs, and 
in a system that seniors have already experienced during their working 
lives.
  Money that could be used to enhance the benefit to seniors would 
instead go to marketing and administrative costs of the insurance 
company.
  The Republican proposal allows insurance companies to determine 
beneficiaries, drugs, how many drugs they will get, what kind of drugs 
they will get, instead of doctors making the decision on our behalf as 
to whether we need Lipitor or Zocor for our cholesterol. Those 
decisions would increasingly be driven by the profits of the insurance 
companies. Seniors deserve the choices, not insurance companies.
  The President must disagree with his party on this because just last 
week in Minneapolis he said:

       I support a prescription drug benefit for Medicare that 
     allows seniors to choose the drug coverage that is best for 
     them.

  I support President Bush in my advocacy of seniors having the 
responsibility and the right to make the decision as to what is in 
their individual best interest.
  The House Republican plan would put our Nation's seniors into an 
untried, untested delivery system that has

[[Page 13029]]

never before been used. Is it fair to older Americans to be used as a 
social experiment for the insurance industry?
  The delivery model presented in the House is, in my judgment, a 
recipe for potential failure, with a paltry benefit. Only those who 
need the most prescription drugs are likely to buy into the plan.
  There is an example of this scheme. We are not talking totally 
theoretically about what is likely to occur under the House Republican 
plan. Several years ago, the legislature of Nevada adopted such a 
structure to be used for their prescription drug program. Their 
proposal was used where beneficiaries soon found that they were looking 
at very high premiums, high deductibles and copayments, which only 
lured the sickest seniors into the program. As a result, beneficiary 
claims exceeded premiums and copayments throughout the entire first 
year of Nevada's experiment.
  The experiment had the State paying a premium of $85 a month per 
member for 7,500 beneficiaries. An independent actuary found that the 
State-operated program, working directly with PBMs, could have provided 
the same benefit for $53 a month. The extra money was paid to an 
insurance company which could have been used to serve 4,500 more 
seniors in Nevada.
  The program has a waiting list of over 1,000 people, no doubt 1,000 
of among the sickest people in Nevada who want to get on to this 
program.
  One of the most important factors for seniors when deciding that they 
will sign up for a prescription drug benefit is cost: How much will it 
cost monthly? How much will they have to pay before benefits begin? How 
much value will there be in the benefit? The Republican plan fails to 
give seniors this value. The plan has a $250 deductible, meaning most 
seniors will have to wait for the benefit to begin, even as they are 
paying monthly premiums during this waiting period.
  This predicament gets worse in the House plan after beneficiaries 
have spent the first $2,000. At that point, seniors, including low-
income seniors, are forced into a gap in coverage. They suddenly, after 
the first $2,000, have to pay 100 percent of the cost of their drugs.
  For a senior like 71-year-old Jeremiah O'Conner, a Ft. Lauderdale, 
FL, resident who survived cancer and now pays $1,279 per month for 
drugs to help with high cholesterol and a prostate problem, the 
Republican gap would begin in March of each year. He will have to float 
without coverage until at least May, still paying a monthly premium.
  For a low-income senior who is 150 percent below the poverty level, 
which is now $13,300 for a single person, this would be more than 25 
percent of their annual income that would have to be used to pay for 
their prescription drugs while they are caught in this gap of coverage.
  The Republican plan will not help those seniors who are choosing 
between food and medicine. The doughnut will provide them with no 
nutrition. All they get is the empty hole.
  For example, Ms. Olga Butler of Avon Park, FL, receives a monthly 
Social Security check of $672, which makes her barely over the income 
limit for Medicaid coverage. This means that 67-year-old Olga has to 
pay for her own medications, sometimes having to make that choice among 
food, rent, and prescription drugs.
  Olga is on Lipitor and Clonidine for her hypertension and high 
cholesterol. She pays $95 a month for Lipitor and $22 per month for her 
Clonidine. These prescription drugs not only improve the quality of 
Olga's life, but they are helpful in warding off possible strokes or 
heart attacks for which she is at a high risk.
  In order to qualify for the Republican prescription drug plan, Olga 
must pass an assets test in order to get low-income assistance--the 
first time such an asset test has been included in any Medicare 
Program. I know you know the answer to this question, but some of our 
colleagues may not know what an assets test is. This test means that 
Olga must deplete her savings which is less than $4,000. She must sell 
off her furniture and personal property, which is worth more than 
$2,000. And she must sell her car, if it is valued at more than $4,500. 
She must place herself in poverty in order to qualify for the low-
income assistance under the inadequate House Republican proposal.
  Mr. KENNEDY. Will the Senator yield for a question on that point?
  Mr. GRAHAM. I am pleased to yield.
  Mr. KENNEDY. So is the Senator suggesting that, on one hand, the 
Republican proposal is suggesting that it is addressing the needs of 
really the lowest income seniors? I think it is always useful to review 
the average income of our seniors, which is about $13,000 a year, and 
two-thirds of them have less than $25,000. So we are talking now about 
the lowest income. I guess it is 135 percent of poverty.
  So, on the one hand, the Senator is suggesting that those individuals 
are going to be covered and then he is pointing out that the 
Republicans have included an assets test, which includes a burial plot 
that is above $1,500. If they have a little cash in their bank account, 
which they have saved over their lifetime, evidently, this says they 
have to spend all of that. You cannot have personal property such as a 
wedding ring. You would have to give that to the pawnbroker and spend 
that.
  Besides those cruel aspects of the assets test, what does the Senator 
think this does in terms of demeaning our fellow citizens--to have them 
go in hat in hand in this country--the greatest country in the world--
and have them have to go through and bring out their little sheet and 
represent the value of their personal goods at home and demonstrate 
what that bank account is.
  We have other ways of making these assessments that can be done while 
treating people with a sense of dignity. Does the Senator not agree 
with me that this is a particularly harsh proposal as well for our 
fellow citizens, particularly those who are extraordinarily needy and 
perhaps feeling a certain amount of despondency for the way life has 
treated them, and then the Republican proposal adds this additional 
dimension? Does the Senator not agree with me that it dehumanizes our 
fellow citizens and humiliates them in ways that are completely 
unacceptable?
  Mr. GRAHAM. It is a testimony to exactly those attributes that we 
have had Medicare for 37 years and never, never has it been proposed 
that we add an assets test to people's ability to secure the basic 
necessities of health care that sustain life and the quality of life.
  The Senator mentioned a number of items that would be lost, from a 
wedding ring to a burial plot. I think of particular significance is 
the fact that you can't own a car that has a value of more than $4,500. 
If you want to go down to the used car lot, you can see what that means 
in terms of an available vehicle.
  Mr. KENNEDY. On this issue, may I ask the Senator a question?
  Mr. GRAHAM. Yes.
  Mr. KENNEDY. In part of the country, winters can be extremely cold. 
The northern tier States are colder still--up in the State of Maine, 
across the northern tier, in Montana, across Minnesota and Wisconsin. 
And the last thing we want for our seniors who are going down to the 
drugstore to get prescription drugs is to have their car break down. Or 
if they are in the southern part of the country, on those superhighways 
where traffic is moving with such rapidity and there is such a degree 
of intensity in terms of the conduct of traffic, you can imagine what 
happens to a senior whose car breaks down on those roads as well.
  We are really flyspecking our fellow citizens. We are trying to set 
up a system that addresses the needy people in our society. Does the 
Senator not agree with me that we can do that with a sense of respect 
and dignity? When we are talking about this point of $4,500 for a car--
which is to try to say that maybe if it is $2,000, we will be more 
understanding.
  I must say that this is a humiliating aspect for our fellow senior 
citizens. I find it so difficult and so unwilling to accept.
  I particularly appreciate the Senator's long explanation and detailed

[[Page 13030]]

elaboration of the Senator's own bill. I pay great tribute to Senator 
Graham and Senator Miller in terms of the fashioning of this proposal. 
I am grateful to be able to join them. I think his careful review of 
the other proposal should make our colleagues think of whether that 
kind of a proposal is worth any degree of support.
  Mr. GRAHAM. I have just one last comment about the automobile. As it 
is for most of us, an automobile is more than just a means of 
transportation; it is a statement of our independence, our ability to 
be able to do those things that make life meaningful. This is a 
particularly important thing for older Americans, many of whom live in 
rural areas. If you say you have a choice, can you imagine the pain 
that a 75-year-old American living in a rural area in your State, or 
mine, or Senator Cleland's, or Senator Stabenow's, would feel if they 
say: Here are your choices: We can give you access to some payment for 
a drug which, if you are unable to secure will almost assuredly decline 
the quality of our life, and maybe cause death, but in order to get 
that assistance, you have to give up your independence by giving up the 
vehicle that allows you to have some degree of mobility. What kind of 
country is America? We are saying this to the generation that we have 
defined as our greatest generation. These are, in many cases, the 
people who have not only lived through the Depression of the 1930s, 
when our country was in tremendous jeopardy, they fought to defend our 
country, or they worked in the defense industries, as did that 
wonderful generation of young American women who did hard manufacturing 
work in order to be sure that those ships, planes, and tanks were 
built; and now we are going to tell these people when they are 75 years 
old: give up your mobility and your independence or give up life 
because you cannot afford to buy the prescription drugs. What kind of 
an America is that? That is not the kind of America by which I want my 
children and grandchildren and great-grandchildren to judge my 
generation.
  Beyond those points, the insult even gets worse because, to use my 
example of Olga, she is not going to be immune from this gap, either. 
So under the Republican plan, once she hit the wall, the beginning of 
that big nonnutritious hole in the middle of this coverage, she would 
have to pay between $3,450 and $5,300 of drug costs, without getting 
any assistance.
  So we have added insult to the tearing away of dignity and 
independence. The Republican plan would make this gap harder to fill by 
only including payments directly made to beneficiaries on their behalf. 
This is a technical issue, but it is an extremely important issue for 
many of our elderly.
  The typical person, when they were 45 years old, their union 
negotiated a contract with their employer and the employer said: All 
right, I am going to put on the table an additional 25 cents an hour of 
immediate income; or I will write into this contract a provision that 
says when you get old and retire, I will pay a portion of your 
prescription drug costs.
  I happen to be a retiree of the Florida State retirement system, and 
I am eligible, when I go on Medicare, to get a certain amount every 
month toward my prescription drug costs. We are going to say that in 
calculating how much you have to have spent out of your pocket to 
become eligible for the catastrophic coverage, you can't include the 
money that your employer is contributing. You have paid for it back 25 
years ago when you gave up that quarter an hour of additional 
compensation to get that benefit, but now it suddenly evaporates in 
terms of counting toward meeting your catastrophic number that will 
allow you to avoid future copayments for your drugs.
  It is just blatantly unfair, and it has been one of the hidden 
issues. If I thought of this idea, I would want to hide it, too. It has 
been effectively hidden.
  Mr. KENNEDY. Can I ask the Senator, and I am so glad the Senator is 
taking the time to explain this issue, and I hope our colleagues are 
going to pay some attention to it because it is very easy to say: A 
prescription drug bill here, a prescription drug bill there, is there 
really any difference? The Senator is pointing out in great detail some 
of the very powerful differences.
  One that is enormously important is how the Graham bill treats 
employers. Those good employers who are trying to provide a 
prescription drug benefit for their employees are hard pressed, 
particularly smaller businesses that pay a disproportionately high 
percentage in premiums. Nonetheless, they are prepared to do it.
  Under the Graham proposal, there are provisions which help those 
employers maintain at least the coverage for the employees. It seems to 
me that everyone wins: The employee wins; the employer wins. The 
objective of the Graham bill is to make sure they have the coverage, as 
compared to the Republican plan which has disincentives, as I 
understand, in terms of the employers.
  There are clear disincentives for employers to maintain the coverage, 
which means there is going to be additional costs and a higher risk of 
coverage. It is a very important part of the Graham proposal. I wonder 
if the Senator will spell that out because that is so important when we 
are looking at what is going to happen to companies that are providing 
prescription drugs and which program is best suited to make sure we 
have a continuity of coverage.
  Mr. GRAHAM. The Senator is absolutely right. Under the current 
system, about 30 percent of our 39 million Medicare beneficiaries 
receive some assistance with their prescription drugs through their 
previous employer. Frankly, that number has been declining as in more 
recent years employers have been less willing to add to their benefit 
package a prescription drug payment in retirement. But 30 percent of 
current seniors do have that, and there is concern that under the House 
plan, which has no incentive for those employers to continue to provide 
the service, they are going to say: Look, we do not need to continue to 
write these checks to our retirees. There is now a Federal program. So 
we are going to cancel out and turn all these people over to the 
Federal Government to pay.
  What we are proposing is that the Federal Government should 
essentially enter into a partnership with those employers. We would 
pick up two-thirds of the cost of what we would otherwise pay for a 
beneficiary. The employer would pick up the rest. It saves the 
employers two-thirds of what they are paying now, but it gives them 
enough incentive that they will continue to participate rather than 
have a new way of cost shift to the Federal Government and to the 
beneficiaries themselves since under the Republican plan it is less 
generous than most of these current employee plans, and so they will 
have to pick up--they, the beneficiaries--additional expenses.
  Mr. KENNEDY. If the Senator will yield, as I understand, the CBO has 
estimated there would be 3.5 million people who are covered now with a 
good program who would lose that good program and be in the substandard 
Republican plan.
  Mr. GRAHAM. Absolutely.
  Mr. KENNEDY. That is CBO. There are the assets provisions the Senator 
just described. There is a provision which is a disincentive for the 
employers. And there is the doughnut or the wall which the Senator has 
described. This is enormously important because their bill fails the 
truth in advertising test.
  Mr. GRAHAM. Mr. President, I appreciate the Senator's thoughtful, 
incisive questions which underscore some of the differences--I think 
clear deficiencies--in the legislation the House has already passed.
  According to the Corporate Health Care Coalition, the benefit of 
employer-sponsored coverage is minimized under the Republican proposal 
and, as the Senator from Massachusetts said, threatens to force 
employers to choose between private plans or the Medicare plan, and the 
estimate is that a substantial number of employers would elect to dump 
their current coverage for retirees and let this become a full Federal 
plan responsibility.

[[Page 13031]]

  This would be a threat to over 3 million seniors who today are able 
to rely on a reduced prescription drug benefit and which under our 
program would be able to, should they elect to do so, have the benefits 
of both their employer plan and the new Medicare plan as, in insurance 
industry terms, a wraparound policy.
  Everyone in this Chamber understands the need for fiscal discipline, 
but this should not come at the cost of providing a meaningful drug 
benefit for Medicare beneficiaries.
  The budget passed by the Senate Budget Committee provides up to $500 
billion for a prescription drug benefit. Mr. President, our plan is 
within that range.
  We do not have to provide beneficiaries a Cadillac. Rather, we would 
be more prudent to provide them with a Chevrolet or a Ford a reliable, 
useful automobile. But we also do not need to provide a benefit that is 
more like a moped--unreliable and cannot be driven on regular roads.
  Mr. President, I say to my colleagues in the Chamber, now is the 
time. We have come to the Senate floor year after year promising 
America's seniors a prescription drug benefit, and every year the 
seniors have come to the beginning of the new fiscal year thinking this 
will be the year in which we will see the promised land, this will be 
the year in which these promises are delivered. Sadly, to recount, 
every year the seniors have found not an open door but a closed and 
padlocked door.
  Today we can take the giant leap that Medicare beneficiaries have 
been waiting over the years for us to take. Just last week in 
Minneapolis, President George Bush said:

       We must make sure that whatever system evolves does not 
     undermine the great innovations that take place in America.

  Surely an untried, untested system such as the House Republican 
proposal which has already passed will have exactly that uncertain 
impact on medical advances. By using a system that is based on what we 
already know works, we do not threaten that innovation. We can, in 
fact, contribute and advance innovation.
  That is what our proposal does. By passing the exact system that 
every Member of the Senate and most Americans use to get their 
prescription drugs, it is within our power to give America's elderly 
the parity, the security, they deserve in their lives and in their 
health care.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER (Mr. Carper). The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. FRIST. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. FRIST. Mr. President, I rise to speak on the underlying bill and 
on the background for Medicare, Medicare modernization, and 
strengthening Medicare.
  First, I am delighted the discussion of health care security for our 
seniors has reached this stage of debate, active discussion, and active 
deliberation in this body. The House of Representatives admirably took 
this issue head on, worked very diligently through a committee process, 
and produced a bill, after debate, after discussion, and it passed. The 
House bill received a majority of votes and represents a very 
deliberate and very solid effort to address the cost of prescription 
drugs. More importantly, it addresses the issue of health care 
security--including prescription drugs as a part of the armamentarium 
physicians or nurses can use in looking seniors in the eyes and saying 
their health care security can be complete by passage of this bill. I 
think this is the crux of the issue.
  Now is the time for us to act to include prescription drugs--that 
powerful tool, that powerful element of health care as we know it 
today--as part of the overall health care security package for our 
seniors. Including a prescription drug benefit within Medicare is long 
overdue. Prior to coming to the Senate, I was blessed to spend 20 years 
providing care to thousands of Medicare patients in the field of chest, 
heart, lungs, pulmonary status, emphysema, lung cancer, heart disease, 
and stroke. Thirty years ago, medicines, including prescription drugs, 
were used in these fields. However, 20 years ago prescription drugs 
were used a lot more, 10 years ago even more, and today they are an 
absolutely essential part of health care delivery.
  As a surgeon, I do not want to say prescription drugs are more 
important than surgery, but it is getting to the point that medicines 
people take every day are equally important in acute and chronic care 
and in disease management. Now is the time for us to address the 
financing of health care delivery in this country, both in terms of the 
organization of health care delivery and insurance coverage.
  Everybody knows the Medicare Program is absolutely critical to health 
care security. I think my colleagues in the Senate will agree that 
Medicare, health care security for our seniors and for our individuals 
with disabilities, is critically important and vital. It is imperative 
that we do not forget that the Medicare debate applies to both seniors 
and those with disabilities. I believe now is the time to strengthen 
it. Others might say to modernize it. Yet even others will say to 
reform it. Whatever word is used, now is the time to take a 1965 
program which has been modified over the years in the way that we 
incrementally do things--and strengthen the program. We need to 
modernize the program to truly deliver what our seniors and disabled 
individuals expect us to do--to give them health care security.
  So whether one uses the word ``save,'' ``strengthen,'' ``modernize,'' 
or ``reform,'' now is the time to have a discussion on the floor about 
the process itself.
  As some people listen to the debate about Medicare and prescription 
drugs, many will question why we need to address the process. The 
process is important to help move such complex bills along in order to 
produce a good bill that can be married with the House bill. We can 
accomplish what most people want to achieve affordable access to 
prescription drugs for our seniors. This is a complicated issue because 
the overall cost of prescription drugs will continue to escalate unless 
we fix it.
  Furthermore, health care delivery will continue to change in terms of 
the overall relative importance of inpatient hospital care, outpatient 
care, acute care, chronic management, and disease management. The 
process is designed to take this complex bill which could potentially 
be the single largest expansion of an entitlement program and modernize 
it, including the coverage of prescription drugs.
  It is important to enact a bill in a responsible way. The demand for 
prescription drugs is going to be high because people will be counting 
on drugs for cures and to improve quality of life. With that sort of 
potential growth superimposed on a Medicare Program which is not 
designed for such growth, the impact will literally bring the overall 
program down.
  For some time, the President and I have argued that as we look for 
prescription drug coverage inclusion, we need to do it in a way that is 
responsible to the American people--to seniors, to individuals with 
disabilities, to the taxpayer, to the current generation. This is also 
important to the next generation coming through the system who, if we 
do not appropriately fix Medicare, simply will not have the Medicare 
Program that they expect and deserve for their parents or for them a 
generation from now. Therefore, Medicare must be strengthened. Medicare 
must be improved.
  I argue we should address prescription drugs through a process that 
includes the committee structure, where appropriate debate can be 
carried out. It is not clear if people have followed the debate over 
the course of today, including which bills are going to be considered, 
if there are going to be large bills to modernize all of Medicare, if 
there are going to be very specific bills that look at the prescription 
drug package to be placed in Medicare, or whether there are going to be 
catastrophic plans. I am hopeful, if we are going to bypass the 
committee process and come directly to the floor, that we

[[Page 13032]]

debate all of those bills so the American people and our colleagues 
will have the opportunity to see the range of alternatives. If we 
consider just one bill, especially if it is a very partisan bill and 
has not been taken through a committee process, the long-term risk to 
the American people is huge. This will not just affect Medicare 
beneficiaries but will impact generations who will be Medicare 
beneficiaries in the future and the people who are paying for Medicare 
today.
  Pharmaceuticals are a critical component of health care delivery. Now 
is the time to act, so let's do it. Let's not talk about a plan that 
will take effect 3 years, 4 years, 5 years from now. Let's go ahead and 
start today and let's do it in a responsible way.
  Other Medicare issues may be addressed if health security is our 
goal. These issues include preventive services and other benefits that 
are covered by private health care plans today that are not covered in 
Medicare. When we strengthen, reform and modernize Medicare, we need to 
do so in a more comprehensive fashion.
  We need to look at the Federal Employees Health Benefits Plan, the 
FEHBP--the health insurance coverage my colleagues and I have. You do 
not hear us complaining very much about our health care insurance. It 
is the same plan through which about 10 or 11 million Federal employees 
get their health care today. We ought to look at that model as we look 
to include prescription drugs.
  There are a number of principles that do need to be stressed as we 
look forward because we do not know exactly what amendments are going 
to be coming to the floor today or over the next several days as we 
consider prescription drug coverage. I would like to stress four 
principles as we consider prescription drug benefit plans.
  First, a prescription drug benefit should be permanent, affordable, 
and immediate.
  By ``permanent,'' I mean that we should not look at bills that will 
fix the program in another 4 to 5 years, rather, we need a bill to fix 
the program sooner. We need to act now. We need to have a bill that 
will help seniors and individuals with disabilities as soon as 
possible. So, I argue we should not start a bill or legislation and 
have its effect, say, 3 years from now.
  When I say a prescription drug benefit should be permanent, I think 
it is dishonest for us to tell seniors that this is the fix when it 
only applies for 4 years to 6 years. It should be incumbent upon us to 
develop a plan, a proposal. We need to be smart enough to do it in a 
bipartisan fashion and include time for adequate discussion, so that we 
pass a bill that can be sustained over time--whether in times of 
deficit, or surplus. Additionally, a prescription drug benefit needs to 
take into consideration breakthroughs in medicine that find cures, 
treat or prevent such diseases as heart disease, Parkinson's disease, 
emphysema, and other lung diseases. Therefore, such a benefit must be 
sustainable to the best of our ability over time.
  That means when we look at a plan, we don't say it starts at 2005 or 
2006 or 2 years from now, and then sunsets 5 years later. I think we 
need to be honest with seniors and the current generation who is paying 
for Medicare today by ensuring that this plan is something that can be 
sustained to the best of our ability, and that it can be sustained over 
time. So, principle number 1 provides for a permanent, affordable, and 
immediate prescription drug benefit.
  A second principle is that a prescription drug benefit should, in 
some way restrain what cannot be sustained long-term--the skyrocketing 
cost of prescription drugs that we see today. Seniors and individuals 
with disabilities cannot afford the high costs of drugs. Likewise, 
people in the private sector cannot afford it. Thus, a prescription 
drug benefit must lower the cost of prescription drugs. I would argue 
the only known way of doing that long term is through an element of 
competition, an element where you have informed consumers. It is an 
obligation of us in government to inform consumers. Consumers are those 
on the front line--seniors listening, to patients, to doctors, to 
nurses. Really, it boils down to what is happening at the doctor/
patient relationship, to involve an element of educated consumers 
making smart, and commonsense decisions, long term.
  The Congressional Budget Office has found that bills similar to 
Senator Daschle's bill, which will likely be coming to the floor later 
this week, would not decrease overall drug costs, but would increase 
drug costs. According to the Congressional Budget Office, bills that 
rely on public/private sector partnerships and an element of 
competition will help maintain the costs of drugs. For example, the 
House of Representatives bill that passed by a majority vote 
illustrates this point. Additionally, the Breaux-Frist bill, introduced 
in the 106th and 107th Congress, is based on the Federal Employees 
Health Benefits Plan model which relies on the private/public 
partnership. Overall, these bills include an element of competition, 
capturing the very best of the public and the private sector working 
together and reducing drug costs for seniors.
  The third principle--following the first principle of permanent, 
affordable, and immediate prescription drug benefit and the second 
principle of competition to lower the cost of prescription drugs--is 
that a prescription drug benefit should be fiscally responsible. We 
need to do it. We need to act in this Congress. We need to act now so 
it will take effect now, and we need to do it responsibly. This is 
where dollar figures are important, so we know what these relative 
alternatives are all about.
  Experts estimate proposals offered by Senator Daschle and some Senate 
Democrats would cost at least $600 billion over the next 8 to 10 years. 
In a time of deficit spending and in a time where the economy is tough, 
this would ultimately require cuts in other fields like education, 
national defense and Social Security. Furthermore, it would place a 
heavy financial burden on the current generation receiving benefits, 
the generation that is paying for those benefits, and the following 
generations.
  The fourth principle I would like to stress is that a prescription 
drug benefit should be bipartisan. That means we need to come together. 
This is a big challenge. This is a big, new entitlement that at the end 
of the day is likely to be adopted--and I would argue should be 
adopted--if it is done in a responsible way. I would argue in this 
climate, especially in this climate where the Senate is about 50-50, 
where the American people are about 50-50 in terms of partisanship, 
that the only way for us to succeed is through a bipartisan bill. We 
need to have people from both sides of the aisle working together in a 
commonsense, rational way. Yes, we will concede to tradeoffs on either 
side to come to common ground. But we need to do it in a bipartisan 
manner.
  The good news is that if we can pull it off with the right 
leadership, if we can pull it off with people who recognize the 
importance of pulling people together, we can do it and it can be done 
now. This will result in seniors benefitting very soon. It can be done 
in a way that is sustainable. I am absolutely convinced there are 
enough people who will work together in a bipartisan way on both sides 
of the aisle--majority of Republicans and majority of Democrats--so we 
can pass such a bill.
  That is a challenge. It is a challenge because we have about 112 days 
left until the elections commence. The real risk is in trying to pass 
such a major piece of legislation in a partisan way--partisan could 
bring it down to where we do not pass a bill. Amidst all the talk at 
the end of the day, there are not going to be sufficient votes because 
the bills are not bipartisan.
  A lot of the discussion today has been basically the other side of 
the aisle reaching out and saying we are ready to move forward, we want 
to take action. But much of the backdrop, is that the Senate Democrats 
today actually canceled or postponed a markup because of a fear that 
the tri-partisan bill that normally--normally the bill would come 
through the Finance Committee to be debated and amendments

[[Page 13033]]

could be debated and passed or failed. There could be good debate among 
20 people in that Finance Committee. The committee of jurisdiction was 
bypassed today with these bills being brought directly to the floor.
  If you agree and if the American people agree that a prescription 
drug benefit is big, now is the time to act.
  The only way in an environment today that tends to be partisan 
because of these elections is to demand bipartisanship. The only way to 
pass a prescription drug benefit is to openly consider the bipartisan 
and the tripartisan bills. And we do that, I again argue, first in the 
Finance Committee; however that does not look like that is going to 
happen.
  I want to make absolutely sure that the Republicans are not 
overstating the importance of taking a bill this big through the 
Finance Committee before coming to the floor of the Senate. The 
tripartisan bill--the bill that has the majority of votes in the 
Finance Committee--has not been debated and has not been voted on or 
marked up in the Finance Committee. Additionally, the bill that Senator 
Daschle likely will bring to the floor sometime in the next several 
days is a strictly partisan bill which has not been considered in the 
Finance Committee either. The American people need to understand that 
Senator Daschle is playing straight up politics. I asked the 
Congressional Research Service to look up the top 10 or so major 
Medicare bills which passed the Congress over the past two decades and 
to find out: (1) Where were they first considered? (2) Did they bypass 
committee and brought directly to the floor of the Senate? They 
responded. It is very interesting. It looks as if there are about 12 to 
15 major bills that have been considered over the past two decades. 
With the exception of one, all of these bills were considered and 
reported by the Senate Finance Committee before they were enacted into 
law. Those bills, again for reference--were TEFRA in 1982, DEFRA in 
1984, COBRA in 1986, OBRA in 1978, the Medicare Catastrophic Coverage 
Act of 1998, the repeal of the Medicare Catastrophic Coverage Act in 
1989, OFRA in 1989, OFRA in 1993, BBA in 1995, BBA in 1996, BBRA in 
1999 were considered through the Finance Committee. The only 
legislation out of the 13 which bypassed committee was BIPA in 2000. 
BIPA is the only piece of legislation out of the 13 bills that did not 
have Finance Committee consideration before congressional passage.
  However, I should note that even that particular bill--BIPA--was 
overwhelmingly bipartisan and passed overwhelmingly as part of the HHS 
appropriations in the year 2000. I mention this because it is important 
for the American people to understand the importance of the process 
which is now being bypassed in order to consider bills, which if they 
remain partisan will simply not pass this body.
  Let me comment briefly on what I think and what I expect will happen 
over the next several days. I expect tomorrow we will continue to 
debate the underlying reforms in Hatch-Waxman. I look forward to 
hearing from Senator Hatch and others about that particular bill.
  There will be several existing bipartisan proposals that are 
currently being filed and currently being submitted that will be 
introduced. I think we will have a good debate on a range of issues. It 
will be an educational process as we go through each of the amendments 
in the bills that come forward.
  I hope as we consider these bills that we have as a goal to make them 
not political issues but to make sure that they are substantive policy 
issues that come forward. It is simply too important to be playing 
politics with our seniors' health care security. I think there will be 
a lot of opportunity over the next few days to talk about these 
specific Medicare proposals.
  Let me close and simply comment on the patent reform bill and the 
modifications in Hatch-Waxman that we will in a more systematic way 
begin to address tomorrow. I think access to prescription drugs clearly 
needs to be the focus as we go forward, but the overall cost is 
important too because if you have prescription drugs and other drugs 
escalating with skyrocketing costs, there is, I think, no system that 
we can contain that long term over time.
  The Hatch-Waxman law, which was passed in 1984, has been tremendous, 
but it has an impact on cost. The cost issues that we see in the 
private sector today are increasing 11, 12, and 13 percent. I don't 
think health insurance can simply be sustained in the long term. One 
major component of the increase in coverage is prescription drug costs 
which continue to skyrocket.
  But I need to caution my colleagues who did not have the opportunity 
to sit through the Hatch-Waxman hearings in the Health Committee, it is 
pretty technical. It is important that we go back and do it right, that 
we fix Hatch-Waxman, or that we update it and modernize it because it 
really hasn't had a major look since 1984. But we must do it in a way 
that maintains the very careful balance that legislators very smartly 
put together in 1984.
  The balance boils down to the fact that you have prescription drugs 
in the pharmaceutical industry that values patents and certain 
protections. Because they have those protections for a period of time, 
they are willing to invest, they are willing to innovate, they are 
willing to discover, and they are willing to put capital at risk. It is 
imperative that we all know how important that is. The only answer to 
finding a cure for coronary sclerosis, for pulmonary emphysema, for 
acute types of leukemia, or for something as big as HIV/AIDS is going 
to be research. Furthermore, I would argue that most of the world's 
research is being conducted in the United States of America.
  Nevertheless, the protection and the incentives that we give to make 
these great discoveries must be balanced. This is the balance that was 
achieved by Hatch-Waxman with access to drugs. That, in large part, is 
determined by a strong, a productive, a broad, a growing generic drug 
industry where we know that important drugs are available at a 
reasonable cost. When Hatch-Waxman started, generics were only about 20 
percent of all drugs. Now it is much greater--greater than 50 percent. 
But it is time to focus on some of those deficiencies in Hatch-Waxman. 
It is that balance that needs to be reviewed because both generic 
prescription drug companies and brand name companies have abused or 
found loopholes in Hatch-Waxman. Now is the time to fix the loopholes. 
We need to do that in a correct manner. That is what much of the debate 
will be about as we go forward.
  Another topic, we had the opportunity last week on a couple of days 
to talk about is bioequivalence. It too is a little bit technical. But 
it is very important because, if we get it wrong, it is not just a cost 
issue. If we get it wrong, it can affect safety issues in terms of 
drugs and generic drugs.
  The Hatch-Waxman law allows generic companies to market off-patent 
drugs if they are demonstrated to be bioequivalent.
  There are definitions of bioequivalence that are applied today. If 
you have drug A, and you have another drug, and you are saying, well, 
this drug is the same as drug A, you want to make sure when you 
actually take that drug that it has the equivalent impact in fighting 
disease, the impact that it is billed to have, that the active 
ingredient is absorbed at the same rate, and that the side effects are 
the same.
  The bill, which is the underlying bill on the floor today, could 
significantly weaken this important patient protection by giving the 
Food and Drug Administration, the FDA, broad authority to relax the 
statutory Hatch-Waxman bioequivalency standard.
  Senator Hatch will be on the floor in the next several days, I am 
sure. I look forward to joining him in talking about a range of issues 
that are of concern to him--and he has been around a long time in terms 
of watching this bill and watching the effectiveness of this bill--and 
myself and many others.
  Again, there are many other Members on the floor who wish to talk, so 
I will bring things to a close. But I wanted to bring forward the 
principles that I think should underline the debate as we move forward.

[[Page 13034]]

  I wanted to point out, in the bill that is currently actively on the 
floor, this modification of Hatch-Waxman. There are a range of issues, 
such as bioequivalence, that I look forward to debating and talking 
with others about.
  At the end of the day, in order for us to really be able to look 
seniors in the eyes and say, health care security is what this bill is 
all about, it means we are going to have to work together, we are going 
to have to do it in a way that is bipartisan, that clearly does not 
have strict partisanship. We cannot play politics with an issue that is 
this important.
  I look forward to working with my colleagues as these bills more 
formally come to the floor.
  Thank you, Mr. President.
  The PRESIDING OFFICER (Mr. Nelson of Nebraska). The Senator from New 
York.
  Mr. SCHUMER. Mr. President, I am glad to take the floor today because 
we are beginning a historic and very important debate on the issue of 
the accessibility and the cost of prescription drugs. It is going to be 
a very important 2 weeks.
  I, first, thank the majority leader for giving us that kind of time. 
This is not an issue that should be dealt with quickly. It is an 
important issue. It affects all of our constituencies. And there are 
many different sides to it. Anyone who thinks the issue is totally cut 
and dry is mistaken.
  We have had great advances in our health care system. Many of them 
are due to these prescription drugs. We knock our health care system. 
It is easy to do. But we often forget about its successes.
  I point to my childhood where, in my neighborhood, Brooklyn, my 
friends would get on their bicycles and come to my house on Wednesday 
afternoons, and they would park their bicycles in the front and walk to 
the backyard and push their heads up against the window of our kitchen 
because sitting in our kitchen every Wednesday afternoon was something 
of a curiosity. It was my great-grandmother, and she was 81.
  Most children in the neighborhood had never seen someone over 80. And 
she was billed as: ``Come see the oldest lady in the world.'' The kids 
from the neighborhood would come around and look at her. And God bless 
her, she lived a long, tough life.
  But now, only 50 years later, we have Willard Scott on TV reading--he 
has given up reading about 80-year-olds and 90-year-olds and 100-year-
olds--about people who are 105 and 106.
  Being 80 is young. My parents, thank God--my dad is going to be 80 
next year. He is healthy. He has had a few little bouts, but he is 
healthy.
  That is the other point I make. We not only live longer, we live 
better. When I think of my dad, who is 79, and played golf Sunday--my 
family and I went over and had dinner with him and my mom. And I 
compared them to--I mentioned this to them just that night--how my 
great-grandmother was so very old and could hardly walk at 81, and here 
is my dad, just about 80, filled and vibrant.
  That did not happen all by accident within 50 years. We have had 
enormous advances in health care. And let's give credit where credit is 
due.
  A good number of those advances are because of the prescription drugs 
we have. They are wonder drugs. I did not experience any of them until 
a year ago when our House physician--our Capitol physician; I am still 
used to calling him the House physician--prescribed Lipitor because my 
cholesterol was high and, boom, down it went, almost like a miracle. He 
explained to me that increases my chances of living longer and 
healthier. So these drugs are very good things. We do not knock them; 
we like them. We are glad they exist.
  I think every one of us in this body realizes that it takes a lot of 
work to create some of these drugs; that it takes time; it takes 
mistakes.
  I took organic chemistry when I was in college, in the days when my 
parents had dreams that I would be a doctor--dreams that went by the 
wayside, I regret to tell my colleagues.
  To do one of those organic chemistry experiments, it is 50 steps. 
Those are little ones, the rudimentary ones. If you mess up step 46, 
you do not go back to step 45, you go to the first step because you 
contaminated the sample. Well, multiply that a million times, and that 
is how difficult it is to conceive and make these new drugs.
  So the companies that make these drugs deserve a lot of credit. These 
drugs are wonder drugs; they are terrific.
  When my friend from Tennessee, Dr. Frist, comes on the floor, with 
all his erudition, and says we have to make sure there is a balance, I 
could not agree more. There has to be a balance. If we were, tomorrow, 
to do something that would mean the next generation of wonder drugs 
would not come on the market, we would be disserving everybody: 
ourselves, our children, our grandchildren. So that is important.
  That is why the legislation that is before us today, introduced by 
Senator McCain and myself, was honed with such care.
  Dr. Frist is right. I am not going to talk in great detail about 
this. We will have another day to debate the issues. I guess the 
minority is going to bring some amendments. We will get into the 
specifics of our bill later. But I do want to say we have taken a great 
deal of care in how we crafted this bill, mindful of the balance.
  Our goal has been to keep that balance. It is our view, Senator 
McCain's and myself, almost by definition--the 16 bipartisan members 
who voted for our bill; in even Dr. Frist's view, who voted against the 
bill--that that balance had fallen out of whack. Here is what I think 
happened.
  I think for the first 10 years or so, the Hatch-Waxman Act, the 
Generic Drug Act, worked quite well. New companies that tried to 
innovate, produced a whole lot of very fine innovations, got a great 
rate of return. If you look at Wall Street numbers, the drug companies 
did just about better than any other industry in terms of their 
profitability. So they were not hurt.
  But, at the same time, it was a pretty certain thing that after that 
drug had its run, and the company not only recouped its costs, and 
recouped the costs of the mistakes that were made--natural and 
reasonable--and made a very fine profit, we would let other companies 
come and put these drugs out on the market.
  It worked. When the generic drug comes on the market--we will have a 
lot more to say about this tomorrow--the cost plummets from 25 to 50 
percent of what it otherwise was. A prescription that might cost $100 
you can get for $25. Success is shown by the fact that now 47 percent 
of all the drugs prescribed are generic drugs, creating the same 
medical benefit but costing people a whole lot less and, incidentally, 
costing our State governments less when they pay for Medicaid, costing 
our big companies less when they pay for their health care plans, 
costing our HMOs less, as well as costing the average person less when 
he or she goes to the drugstore counter.
  What happened in the last 5 years, in my judgment, was that Hatch-
Waxman was thrown out of whack. It was thrown out of whack because too 
many--not all, by the way; a company such as Merck does not engage in 
this practice; a few other companies are very reticent and reluctant 
and mild in the way they engage in this practice--in general, a whole 
lot of drug companies saw that they had these huge blockbuster drugs on 
the market and the patents were expiring. They said: My goodness, now 
the generics will come along, and what are we going to do? We will make 
a lot less money.
  What they started to do was to work with their lawyers and their 
advertisers and everybody else to figure out ways to basically extend 
the life of the drug. They have done it a whole lot of ways. In fact, I 
think I will submit for the Record five or six articles in the Wall 
Street Journal--hardly a publication that is anticapitalist--that 
showed various ways drug companies tried to get around the laws, tried 
to stretch the laws. Many of them involved the use of generics. But 
suffice it to say, they tried to figure out ways of going beyond the 
original Hatch-Waxman intent.
  One of the key ways they did it was to, what I call, innovate, not 
new drugs

[[Page 13035]]

but new patents--same old drug, new patent. And because the law had 
never been updated, as Dr. Frist said, they found a lot of clever ways 
to do it.
  It began to get out of hand. They would say: Give me a new patent 
because I am changing the type of pill. Give me a new patent because 
there is a different color bottle in which I will put the drug. No one 
who voted for Hatch-Waxman thought these were reasons to extend 
patents.
  Then they began to do other things. Some people came over to me and 
asked: What about the situation where there is a vaccine for HIV and 
they come up with an oral drug; why shouldn't you allow that to have a 
new patent? We want to. We don't want to allow the oral patent to then 
extend the vaccine patent. In other words, if they come up with an oral 
one, let them apply from scratch, get the whole 20-year patent from the 
day the patent is filed. But if the vaccine patent is about to expire 
in a year, don't use the oral patent to extend the vaccine patent. That 
is a little less virulent form of this kind of game.
  So what Senator McCain and I did a couple years ago, actually, was 
sit down and examine the most egregious abuses. We said: How are we 
going to curb these abuses? How are we going to restore the original 
balance of Hatch-Waxman?
  The proposal we came up with did that. By the way, it made some of 
the generic companies not happy either. This is not a bill that is just 
supposed to side with the generic companies; it is a bill that sides 
with the consumer. When the pharmaceutical company is abusive, we go 
after them. But when the generic is abusive, we go after them, too.
  In one part of our bill, we wanted to get at the fact that certain 
generic companies that were given 180-day exclusivity so they might get 
a leg up and give them incentive to go out on the market, they were 
sort of selling that right to the pharmaceutical, the brand name 
company, and then there would be no generic. We stopped that. It was 
modified by the amendment of Senator Edwards and Senator Collins. But 
we looked at the abuses on each side and said: Let's stop it. Let's 
restore the balance.
  This started out as a very modest bill. In fact, I think the 
pharmaceutical industry didn't pay much attention. They said: Who is 
going to pay attention to something that is admittedly technical? But 
what we found was that when you looked at this bill, it was one of the 
most important ways to reduce cost--reduce cost not just for seniors 
but for everyone, reduce cost for government and get those generics 
out.
  Over the next couple of weeks we will have a debate on this, and 
there will be amendments to change what we are doing--probably in the 
next day or two--and we will debate it.
  I want to say two things, though, in addition to talking about this 
specific proposal. The first is the view of my good friend from New 
Hampshire that somehow we didn't try to include him, that he is 
delaying the bill because, well, we could have worked out this 
language. First, this bill is not brand new. It wasn't written on the 
back of an envelope last week; it has been around for a long time. On 
many occasions I would go to Senator Gregg and say: Let's sit down and 
work something out, and he would be amenable, but nothing much would 
come of it.
  The only point I am making is, he knew about the bill long before. 
And then at the end, when in an effort to try to get this bill to be 
bipartisan--it is always better--Senator Edwards and Senator Collins 
started to work together on some changes and didn't do a terrible 
injustice to our bill, Senator Gregg began to get involved. And we 
started talking to him. Senator Kennedy and his staff were talking to 
him. And basically when Senator Gregg had a few objections, we were 
willing to go along with them.
  First, he raised earlier the clarification of the language on this 
45-day provision in the bill, the idea that you would have 45 days to 
sue. Senator Gregg had reminded us that there was an agreement during 
the markup to clarify the language, to make very specific that if a 
patent owner chose not to sue one generic applicant, it wouldn't be 
precluded from suing another. He is right. We honored that agreement. 
It is in the proposal. Following the markup, the staff changed the 
language to make the clarification so there would be no confusion.
  It is my understanding that those technical changes were then 
forwarded directly to Senator Gregg's staff. Then the first time we 
heard about it was long afterwards. I guess it was this morning that we 
heard this was a problem.
  That doesn't sound to me as though you are concerned with policy. 
That is saying to me, wait a minute, let's delay this thing. And I 
don't think that is what we should do, no matter what our view is here.
  We all agree on the policy. Let me clarify it. The intent of the 
provision and the effect, because it is now clearly written--it may 
have not been clearly written before--was not to cut off all the rights 
of a patent owner if it refrains from suing a particular generic 
applicant within 45 days. Rather, it just cuts their rights off to sue 
that company.
  It says that if a brand company chooses not to sue a particular 
generic applicant on a particular patent, the brand company only loses 
its right to sue that generic applicant or anyone else who sells or 
distributes that applicant's version of the drug.
  So if Schering-Plough chooses not to sue Mylan for a patent 
infringement within 45 days, if they choose not to sue Mylan, they lose 
their right to sue Mylan or anyone else who distributes Mylan's version 
of the drug, but they will have every right to sue Barr or Teva or IVAX 
or any of the others, in complete accord with what we said that day at 
the markup.
  This is no reason to hold up a bill. It says exactly what my friend 
from New Hampshire wanted. Now, if there is some staff talk that the 
language doesn't say that, let's sit down and take a look, but let's do 
it immediately. Let's not spend 30 hours sitting on the floor, each of 
us fulminating and not moving the bill forward and doing the people's 
business.
  We have a lot of issues to discuss--not just generic drugs. We will 
discuss the Canadian importation and the ability of States to form 
consortia--all to lower costs. Then there is the big debate, of course, 
which is accessibility, allowing more people to get the drugs.
  There is a one-two punch here: Lower the cost and extend the number 
of people who have the ability to get the drugs. But it is just almost 
to the point of, at best, counting the angels on a pin and, at worst, a 
desire to delay, to say that we don't have an agreement.
  I wanted to discuss another issue Senator Frist brought up--the 
bioequivalence issue. There is a lot of debate about bioequivalence and 
a lot of discussion about bioequivalence. The enemies of generic drugs, 
early on, had tried to say that the generic is not the same as the 
nongeneric in terms of its active ingredient. That reminds me of the 
argument I had with my mother. I take a vitamin C pill. She would say: 
Son, drink the regular orange juice. I would say: Mom, the vitamin C in 
the pill is exactly the same as the vitamin C in the orange juice. She 
said: No, no, no. I said: Well, it has nice little orange flecks in 
there, and it tastes different, but if you looked at the oxygen, 
hydrogen, and carbon atoms lined up in the vitamin C molecule, you 
could not tell the difference. She said: No, no, have the orange juice.
  It is the same thing my friend, the good doctor from Tennessee, is 
talking about. The FDA knows what bioequivalence is. While some in the 
brand name debate have tried to imply in the past that the generic drug 
isn't as pure, or its inert ingredients may be different from nonactive 
ingredients, we all know it is bunk. The FDA has had rules on 
bioequivalence that have met every test for years and years, and no one 
has contested them. In all of the fighting between the brands and 
generic name court cases, there hasn't been an issue. All of a sudden, 
we are hearing that bioequivalence is an issue.
  So what did we do? Senator Kennedy, in the bill--it may have been 
Senator Edwards. Well, an amendment was

[[Page 13036]]

added in the committee that took exactly what the FDA has done, without 
any dispute for the last 10 years, and codified it. Now, all of a 
sudden, we are hearing that bioequivalence is an issue. It is not an 
issue. It is a smokescreen for people who want to delay.
  So my view is a simple one. Let's get on with the debate. We have two 
major issues before us--the issue of cost and the issue of access. The 
McCain-Schumer bill, the Dorgan proposal, and the Stabenow proposal on 
the States, all reduce the cost of the drug--here is my good colleague 
from Michigan now whom I just mentioned--to everybody, including senior 
citizens, parents who have a child who needs a serious drug, to State 
governments.
  Then let's go on to what will probably be the main show, which is 
access, because so many people need access to these drugs. The one is 
not exclusive of the other. People ask me, Will you be happy if just 
the McCain-Schumer bill passes? No. I hope it will pass, but we have to 
go beyond that and we have to increase access. We have to have a good 
prescription drug plan to undo the mistake of those who wrote Medicare 
in 1965--except they didn't know there were so many of these drugs.
  My plea to colleagues is this: Enough. We are debating about the 
number of angels on the head of a pin. We are debating about things 
that have long been settled. Let's move the bill forward. Let's lower 
our costs. Let's increase access. Let's disagree in a civil and fair 
way, and then let's vote and let the chips fall where they may.
  Mr. KENNEDY. Will the Senator be good enough to yield?
  Mr. SCHUMER. I am happy to yield to our leader from Massachusetts.
  Mr. KENNEDY. Mr. President, I am struck by the point the Senator 
makes again on the floor of the Senate, which I have heard him make 
many times but which I think is important to understand, and that is 
that this is actually a very conservative piece of legislation. 
Effectively, if we accept the underlying legislation, which is just a 
version of the legislation the Senator introduced with Senator McCain, 
really we are going back to what the original intention of the Hatch-
Waxman proposal was all about.
  I appreciate the Senator giving the historic perspective because at 
the time we passed the Hatch-Waxman, we anticipated the breakthroughs 
in many different areas of new pharmaceuticals to try to deal with the 
challenges of our time. It has never been more likely than it is now. 
We are in the life science century. Even since the passage of Hatch-
Waxman, we have seen the sequencing of the human genome. We have this 
extraordinary DNA revolution. We have gone through these extraordinary 
kinds of basic new research. We have seen this explosion using new 
kinds of technology matched together with research, which is opening up 
extraordinary possibilities. We have heard about this in our HELP 
Committee.
  So the opportunities are out there in terms of trying to see the day 
when Alzheimer's is no longer the scourge of so many families in this 
country. That would empty two-thirds of the nursing home beds in my 
State of Massachusetts. That is probably true also in the State of New 
York. We believe the Hatch-Waxman proposal was to try to make sure for 
the drug companies, the brand companies, that were prepared to go ahead 
and take advantage of these extraordinary opportunities, building on 
the incredible investment the American taxpayer has made in the NIH, 
which has been doubled in recent years. It is an additional reason the 
Schumer amendment ought to go in.
  We ought to have the energy of those companies in these breakthrough 
new opportunities rather than in the ``me too'' drugs. This, I believe, 
is not only dealing with the abuses that exist, but also, if we let 
this continue along, it seems to me there will be a continued kind of 
financial incentive not to take chances for these breakthrough drugs 
that are out there, in terms of making such a difference in dealing 
with the health challenges we face, and there will be these financial 
incentives to game the system in order to deny people the lower cost of 
drugs by the generics.
  So I commend the Senator. We will have a lot of debate and discussion 
about patent and patent laws and timing--30 months, and 180 days, and 
45-day windows, and bioequivalency, and the rest. But we are talking 
about, as the Senator eloquently stated, a major downpayment--the first 
one that I know in any recent time that will bring pressure to lower 
the cost of drugs.
  This is a major achievement and accomplishment if we do it. It is not 
going to solve the problem, but for the many families who are going 
home tonight and buying their drugs and finding out that the costs have 
increasingly gone up so far beyond the cost of living, it will make a 
big difference, will it not?
  Secondly, I don't know what the argument is--I have not heard it--for 
the second provision of the Senator's amendment that deals with 
collusion between the brand names and the generics, which is taking 
place out there.
  That is as bad as the gimmickry we have seen from these corporate 
scoundrels who have made out like bandits, such as at Enron, getting 
billions of dollars and then giving short shrift to the workers. What 
is the difference if those corporations make out like bandits, and in 
this case, instead of the workers, it is the seniors and sick people 
who will suffer? I do not see a great deal of difference.
  The Senator has made such a strong statement. I am as perplexed as he 
is that we have not had a chance to get to the bill this afternoon and 
debate it. The Senator has correctly given the interpretation we had of 
the clarification of language that was raised.
  I point out to the Senator and ask if he will agree with me, if they 
do not agree with language, we will be willing to accept the language 
to clarify those provisions. It is very clear what the intention was in 
the hearing record. We are not trying to change our position. We are 
still at that position. If they have language to do that, we will take 
it now and get on with the bill.
  We should be under no illusions. That is not it. They want to change 
other provisions, substantive provisions. All the Senator from New York 
is saying is, if that is the case, why are we not out here debating 
those issues and taking votes on them and moving this legislation 
forward?
  Does the Senator find any reason this can justify why we are having 
this delay on this important legislation that can make such a 
difference to many people? Why is it that on a Tuesday afternoon in 
July we are not doing the people's business and voting on these 
matters, debating these matters but instead are caught in tactical 
maneuvers by those who are opposed to the legislation?
  I say to the Senator, it is being perpetrated by those who do not 
want any bill at all. If we do not have any bill at all, there will be 
brand companies that will make billions of dollars out of the pockets 
and pocketbooks of the consumers, which is in complete violation of the 
Hatch-Waxman bill. They are the ones who are behind this delay, and 
that is unconscionable.
  I would appreciate any comment the Senator wishes to make on that 
issue.
  Mr. SCHUMER. I thank my colleague. No one puts it better than he 
does, and he is exactly right. Let's vote; let's debate. Our 
differences are not very large. That is what makes us scratch our heads 
and think that really they do not want a bill; they hope we will give 
up. They hope people will lose interest. They hope something else will 
come along, maybe another corporate scandal. But I think I can speak 
for our leader, the Senator from Massachusetts, as well as the Senator 
from Minnesota, as well as the Senator from Michigan, that we are not 
letting this issue go away. They can delay us for a week or a month, 
and we will be back, it is so important.
  I will make one other comment. My colleague from Massachusetts is 
just so good at this. After I am here half as many years as he, if I 
can be a quarter as good as him, I will be very happy. Here is what he 
said and I think it is worth repeating.
  We are doing not only the public but the drug companies a favor. With 
this

[[Page 13037]]

amendment, we are putting them back on track. They have lost their way. 
They are degenerating into something that is hated. For people who 
create such wonderful drugs, why should they be so despised? I saw a 
survey just recently that the drug industry was more disliked than the 
oil and gas industry. The reason is they all are losing their way. It 
should not be for the Senator from Massachusetts, the Senator from New 
York, the Senator from Michigan, and the Senator from Minnesota to help 
them find their way; they should find it themselves. But they have lost 
their way, and the Senator from Massachusetts has stated it 
exquisitely, which is we are going to send them back on the path of 
innovating, of creating new wonderful drugs, of doing good for society, 
and making money as they do it. We want them to do that. But we want 
them to add value, we want them to cure new diseases, not simply find a 
new color of a pill that already cures a disease. We want them to find 
new techniques.
  We are sending them in the direction they started, but they have lost 
their way, and the smart ones in the industry know. I hear it 
whispered. They are letting the worst ones, the bad apples who will do 
anything, extend their profitability even if they do not have a new 
drug in their closet. They are letting those people lead and, in a 
sense, what we are saying is: Go back to your sacred mission. Go back 
to the mission of finding new cures and finding new drugs, and not only 
will you make money, but you will be proud of what you do.
  Mr. KENNEDY. Will the Senator yield on that point?
  Mr. SCHUMER. I will be happy to yield to my colleague.
  Mr. KENNEDY. On this point the Senator makes--and I hope our 
colleagues will listen--we will put in the Record the exact figures, 
but if one were to look at a chart for new drugs and innovation, one 
would see that chart rising and rising, going up and up until almost 
the passage of the Hatch-Waxman bill. From that time, the innovations 
have gone down. It is the darndest thing we have ever seen.
  I was absolutely startled by this. This might have been maybe one or 
two circumstances, the evergreening process which the Senator has 
outlined.
  On the Senator's point about getting these drug companies back to 
doing what we had all hoped they would do and we know they can do and 
hopefully will do, every one of us have family members who benefit from 
these innovations, but we find that is not where they are going.
  We have doubled the NIH budget, $33 billion, $34 billion a year. We 
doubled that over a period of time. Why did we double that at a time of 
scarce resources? The reason we doubled it is because Democrats and 
Republicans understood this is a life science century, and it is 
unlimited in its ability. It seems everybody knows this except the drug 
companies. That is what has been disappointing.
  I thank the Senator again for outlining the basic provisions which, 
as he has mentioned, bring us back to ground zero. They bring us back 
to what was achieved with the Hatch-Waxman period, and does that to 
eliminate the collusion which is taking place and the gimmicking of the 
system which basically means higher prices for consumers. That is the 
challenge.
  If others have better ways of doing it, I am sure the Senator will 
agree, let's do it, but we did not see that. My friend from Minnesota, 
Senator Wellstone, was in that markup. We did not hear other ways of 
doing it. All we heard was more delays, more delays, objections, 
objections, objections. That is because clearly there are billions of 
dollars at stake. We are talking about billions of dollars of profits 
for certain of these companies. No wonder they are out here in force 
trying to resist the Schumer proposal.
  I thank the Senator for his excellent presentation.
  Mr. SCHUMER. I thank the Senator from Massachusetts.
  The PRESIDING OFFICER. The Senator from Minnesota.
  Mr. WELLSTONE. Mr. President, I say to my colleague from Maine, and I 
know the Senator from Michigan is here, I will actually be very brief. 
This will not be a typical Wellstone speech. I only have about 10 
minutes. I say to the Senators from New York and Massachusetts, I very 
much enjoyed their discussion. I thank the Senator from New York for 
his leadership on this issue.
  I remember, I say to Senator Schumer, during my years here two very 
humorous situations; one especially where somebody tried to extend the 
patent for Lodine. I actually found out about this, and I think Senator 
Kennedy was also involved in trying to get to the bottom of it. It was 
in the language of the bill, but nobody would take credit for it. 
Nobody would take credit for having done this, although obviously 
somebody put in the language. It was you laugh or you cry--the whole 
notion that we can extend the patent and it does not go generic and 
they make a lot of money. But who gets hurt as a result?
  The same thing has come up with Claritin as well. This is a no-
brainer of where 99 percent of the people of the country are, that is 
for sure.
  The only issue on which I disagree with my colleague from New York--
and I am sorry to be the one more hard hitting on this, and I do 
apologize--I do not know that the pharmaceutical companies have lost 
their way--as in recently. As I go back--Senator Kennedy probably knows 
the history better than I do--I have done a lot of reading about Estes 
Kefauver in the early fifties. He took on the pharmaceutical industry, 
and they took him on.
  David Pryor, am I not correct, really did this? We have been battling 
it out with him for a long time. This is an industry that has been 
making Viagra-like profits, if I can say that on the floor of the 
Senate. It would be funny and a little cute to say it, except that what 
this really means is people cannot afford the prescription drugs, at 
least the people I represent.
  This legislation is very important. I know Senator Collins has worked 
very hard on it. There is quite a bit of bipartisan support. I had a 
chance to speak earlier this morning about other provisions. I heard 
Senator Graham speak earlier. Senator Kennedy has spoken about it.
  I want to say one thing about two other pieces of this in about 4 
minutes. One is on this whole question of, how are we going to make 
sure there are affordable prescription drugs? I think delivery is 
critically important. There is a world of difference between adding 
this on to Medicare and making it a defined benefit.
  We are learning all about defined benefits versus defined 
contributions as people see what is happening to 401(k)s versus the 
language in the House bill that suggests this will be the deductible 
and suggests this will be the premium but, frankly, there is no 
guarantee of it. This needs to be a defined benefit, and it does need 
to be a part of Medicare. We ought to at least agree on that.
  Then I think there are going to be these trade-offs as to how much 
money versus how good is catastrophic coverage. I am sorry to go sort 
of populist on everyone, but I think I heard the Senator from Florida 
say earlier that for those of us in the Senate and the House--and we 
make pretty darn good salaries compared to the vast majority of the 
people we represent--something like 80 percent of our prescription 
drugs are covered. We might pay 20 percent, and that is it. It seems to 
me we ought to do as well for the people we represent.
  My dream is to someday be in the Senate when we are debating Medicare 
for all. That is what I want to get back to. I almost think the people 
we represent should have as good a plan as we have through the Federal 
Employees Health Benefits Plan. But that is another debate for another 
time.
  I cannot imagine how any of us could support any legislation that 
says when it comes to catastrophic expenses, after someone is over 
$2,000 a year--the very point where people are hurting--then we say we 
are not going to give any coverage, not until they get up to $3,700. 
That is nonsense. People say: What do you mean? One of the things

[[Page 13038]]

we want you to do is help us deal with what happens when our expenses 
go up year to year. That is the second point.
  The third thing I want to mention is I am going to be doing a bill on 
the whole question of drug reimportation for the year, which Senator 
Dorgan has addressed. It could be Senator Snowe and Senator Collins 
will be a part of this. I know Senator Stabenow is. We are going to 
have legislation or an amendment that deals with cost containment, and 
I want to say one more time it is a simple and straightforward 
proposition. We are coming out together, and I assume there will be 
some strong bipartisan support. I know I am going to do it with Senator 
Dorgan and Senator Stabenow, and I think there will be Republicans as 
well. Basically, what we are going to say is you use the same FDA 
strict safety guidelines, and our citizens ought to be able to reimport 
these drugs.
  I want to give some examples, and then I will be finished, I say to 
my colleague from Maine.
  Celebrex, which is used for arthritis: A bottle costs $84.95 in the 
United States and $30.99 in Canada.
  Glucophage, a medicine for diabetes, costs $63.12 in the United 
States and $16.68 in Canada. Think about that. I will not do the 
arithmetic because people can figure it out.
  Methotrexate, a drug for cancer: $51.03 in the United States, $17.30 
in Canada;
  Tamoxifen, a breast cancer drug: $287.16 in the United States, $24.78 
in Canada--same bottle, same dosage.
  Imagine that. There is nothing that infuriates people more in 
Minnesota, makes them believe they are more exploited and ripped off by 
this industry, than this sharp contrast in prices.
  There is legislation that Senator Dorgan, Senator Stabenow, and I are 
going to introduce, as well as others--I do not want to speak for 
Senator Collins, but Senator Collins and Senator Snowe have been real 
leaders on this issue. This does not ask the Federal Government to 
spend any more money. We do not have to run into that issue. We do not 
have to talk about how much it is going to cost. This will dramatically 
reduce the cost of prescription drugs for our citizens.
  The only question is this, and then I will sit down: I can promise, 
once people know it is the same strict FDA guidelines, once we make it 
clear if anything ever happens, if this goes wrong, then emergency 
action can be taken--I will say to the Chair this will happen in 
Nebraska--90 percent of the people are going to say: Absolutely, this 
is the best kind of free trade, and we ought to be able to do this. We 
ought to be able to reimport, or our pharmacists should be able to do 
it. There is one interest that is going to be opposed--pharmaceutical 
companies. They are not going to like it. But at a certain point in 
time do we not say: Tough luck. This is going to be a test case of a 
vote of whether we are going to represent the people in our States, 
democracy for the many, or whether we are going to let the 
pharmaceutical companies stop it. It is that simple.
  We had a 97-to-0 vote last night on legislation on which Senator 
Sarbanes and others worked so hard. That was stuck in committee 
forever, and people finally said: We have had enough. Do you know what. 
People in the country said it. People in the country are beginning to 
say: We have had enough. We do not want the pharmaceutical industry to 
run the show. We want you, Senator, to be accountable to us.
  That is what these votes are going to be about. This is going to be a 
test case of whether we have a real system of representative democracy 
working.
  I have taken some positions where I know the majority of people do 
not agree with me, but not in this debate, not in terms of where the 
vast majority of people in all of our States are. Let us not 
disappointment them.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Maine.
  Ms. COLLINS. This week we have a tremendous opportunity to make 
progress on an issue that affects Americans of all ages, but 
particularly our elderly, and that is the high cost of prescription 
drugs. I hope by the time the end of next week comes along, we will 
have passed the tripartisan legislation to provide a prescription drug 
benefit under Medicare that is long overdue. I also hope we will pass 
the legislation to which we are about to proceed, and that is the 
Greater Access to Affordable Pharmaceuticals Act.
  I commend my colleagues from New York and Arizona, Senator Schumer 
and Senator McCain, for their leadership and hard work in bringing this 
issue to the forefront. I was pleased to have had the opportunity to 
join with my colleague from North Carolina, Senator Edwards, in 
offering a compromise in the Health, Education, Labor, and Pensions 
Committee last week where it was approved by a strong bipartisan vote.
  I also acknowledge the hard work of our chairman, Senator Kennedy, 
and our ranking minority member, Senator Gregg, on this issue.
  During the last 20 years, we have witnessed dramatic pharmaceutical 
breakthroughs that have helped to reduce deaths and disability from 
heart disease, cancer, diabetes, and many other diseases. As a 
consequence, people are living longer, healthier, and more productive 
lives. These medical miracles, however, often come with hefty 
pricetags, raising vexing questions about how patients, employers, and 
public and private health plans can continue to pay for them.
  Prescription drug spending in the United States has soared by 92 
percent during the past 5 years to almost $120 billion. These rising 
costs are particularly a burden for the millions of uninsured Americans 
as well as for those seniors on Medicare who lack prescription drug 
coverage. Many of these individuals are simply priced out of the market 
or forced to make decisions--that no one should have to make--between 
paying the bills or buying the pills that keep them healthy.
  Skyrocketing prescription drug costs are also putting a squeeze on 
our Nation's employers. We are struggling in the face of double-digit 
annual premium increases to continue to provide health care coverage 
for their employees. I know from talking to the small businesses in my 
State, these escalating costs are a real problem for our smaller 
employers. They want to continue to provide health insurance coverage 
for their employees but they simply are finding it increasingly 
difficult to do so. If they pass on the higher health insurance costs 
to their employees, more and more of the workers deny coverage. They 
decline coverage because they cannot afford their share of the premium.
  One of the key factors behind the escalating costs of health 
insurance is the high cost of prescription drugs. These high costs are 
also exacerbating the Medicaid funding crisis that we hear about from 
our Governors back home as they struggle to bridge the growing 
shortfalls in their State budgets.
  The Presiding Officer and I have been working very hard on a proposal 
to increase the Federal match for Medicaid funding to help our 
Governors and our families, who are so dependent on these services, 
cope through this difficult time when States are struggling with budget 
shortfalls.
  In 1984, the Hatch-Waxman Act made significant changes in our patent 
laws that were intended to encourage pharmaceutical companies to make 
the investments necessary to develop these miracle drugs. At the same 
time, the legislation was intended to enable their competitors to bring 
lower cost generic alternatives to the market. In large measure, the 
Hatch-Waxman Act succeeded.
  Prior to Hatch-Waxman, it took 3 to 5 years for generics to enter the 
market after the brand name patent had expired. Today, lower cost 
generics often enter the market immediately upon the expiration of the 
patent. As a consequence, consumers are saving anywhere from $8 billion 
to $10 billion a year by purchasing generic alternatives.
  Moreover, there are even greater potential savings on the horizon. 
Within the next 4 years, the patents on brand name drugs, with combined 
sales of $20 billion, are set to expire. If the Hatch-

[[Page 13039]]

Waxman Act were to work as it was intended, consumers should expect to 
save between 30 to 60 percent on these drugs as the lower cost generics 
become available after the patents expire.
  However, despite its past successes, it is becoming increasingly 
apparent that the Hatch-Waxman Act has been subject to serious abuse. 
While many pharmaceutical companies have acted in good faith, there is 
mounting evidence that some brand name and generic drug manufacturers 
have attempted to game the system in order to maximize their profits at 
the expense of consumers. News reports, for example, have detailed how 
the manufacturer of the lucrative drug Prilosec, the patent on which 
was set to expire last fall, has used the automatic 30-month stay under 
the Hatch-Waxman Act to tie up generic manufacturers in court, in 
litigation, over secondary patents in order to keep the generic version 
of the drug off the market.
  In the year 2000, Prilosec was the best selling drug in the world and 
generated an estimated $4.7 billion in U.S. sales. The Medicaid Program 
in Maine spent over $8 million on Prilosec in the year 2000. This bill 
could be cut in half if the generic alternative were available. So 
instead of the State of Maine spending $8 million on Prilosec if the 
generic were available, as it should have been last fall, the State of 
Maine would save about $4 million. That is much needed money that could 
be put into other health care services.
  I mention that because that is just one drug. But that illustrates 
what happens when a brand name manufacturer exploits the loopholes in 
the current law to delay consumers access to the generic equivalent. 
That is just wrong.
  It is no wonder that this legislation is supported by a broad 
coalition representing Governors, insurers, businesses, organized 
labor, and individual consumers who are footing the bill for these 
expensive drugs and whose costs for popular drugs such as Prilosec 
would be cut in half if the generic alternative was available when it 
was supposed to have been. We are not talking about infringing on the 
legitimate patents that protect the innovative drugs developed by 
pharmaceutical companies. We are talking about eliminating abuses that 
we are finding increasingly prevalent where the brand name manufacturer 
exploits the loopholes in the current law by engaging in excessive 
litigation for the sole purpose of keeping the generic off the market.
  I ask unanimous consent that letters from the Business for Affordable 
Medicine and the Coalition for a Competitive Pharmaceutical Market 
expressing support for the Edward-Collins compromise approved by the 
committee be printed in the Record at the conclusion of my remarks.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (See exhibit No. 1.)
  Ms. COLLINS. Mr. President, I was also disturbed by the testimony of 
the chairman of the Federal Trade Commission before the Senate Commerce 
Committee. He testified there were a number of examples where the 
branded and generic drug manufacturer actually conspired to game the 
system and attempted to restrict competition beyond what the Hatch-
Waxman Act intended. One case cited in the chairman's testimony 
involved the producer of a heart medication which in early 1996 brought 
a lawsuit for patent and trademark infringement against the generic 
manufacturer.
  This is what happened. Instead of asking the generic company to pay 
damages, the brand name manufacturer offered a settlement to pay the 
generic company more than $880 million in return for keeping the 
generic drug off the market. So the brand name manufacturer essentially 
conspired with the generic manufacturer and paid off the generic 
manufacturer to keep the cheaper generic alternative from coming to the 
market.
  The consequences for consumers were considerable. This heart 
medication, which treats high blood pressure, chest pains, and heart 
disease, costs about $73 a month but the generic alternative would have 
cost only $32 a month. The compromise legislation that we will soon 
consider will make cost-effective generic drugs more available by 
restoring the original intent of the Hatch-Waxman Act and by closing 
the loopholes that are delaying competition and slowing the entry of 
generics into the marketplace.
  First, as amended by the Edwards-Collins compromise, the legislation 
would limit brand name manufacturers to a single 30-month stay for 
patents listed at the time of the brand product approval. Now, this 
will eliminate the brand manufacturer's ability to stack multiple and 
sequential automatic 30-month stays during patent litigation in order 
to keep generics off the market and extend their market exclusivity 
indefinitely. That is one of the primary abuses that our proposal would 
end.
  It will help ensure that key patent issues are adjudicated before the 
generic goes to market, while at the same time ensuring that improper 
late listed patents are not able to obstruct market competition.
  We heard in committee examples of the brand name manufacturer making 
extremely minor changes, such as in the color or the design of the 
packaging or the scoring of the pill that really did not indicate a 
different or improved use for the product but, rather, were devices 
intended to keep the generic off the market for a while longer.
  For subsequent patents for which no automatic 30-month stay is 
available, a brand name company can still obtain a preliminary 
injunction based on merit to protect their patent rights and keep the 
generic product off the market if it is justified, if there truly is a 
legitimate patent issue. However, in too many cases we found there is 
not a legitimate patent issue. This is just an abuse and an 
exploitation of the loopholes in the current patent law.
  Moreover, our legislation stipulates that the court is not to 
consider the possible availability of monetary damages when it is 
deciding whether or not to grant injunctive relief. This provision is 
intended to address the concern expressed by the brand name 
pharmaceutical companies that it is difficult to obtain injunctive 
relief in patent litigation because it is the court's view the treble 
monetary damages involved in these suits as an adequate remedy.
  Second, the legislation will prevent the current 108-day exclusivity 
provision of the Hatch-Waxman Act from becoming a bottleneck for 
subsequent generic competitors. Under Hatch-Waxman, the first generic 
drug company to file an application with the FDA certifying that the 
patents on the brand name product are either invalid or will not be 
infringed is now granted 180 days of market exclusivity, once its 
application is approved. Entry to the market for other generics is 
therefore frozen until the 180-day period runs out on the first-to-
file.
  This provision has made it attractive for the kind of abuse that I 
mentioned earlier, and that is where a brand name manufacturer pays the 
first-to-file generic company to stay off the market.
  What that results in is nobody else can come to market, under the 
current law, during that 180-day period. So you can see how that is 
abused, when the brand name firm pays the generic manufacturer to 
essentially forfeit that 180 days of exclusive market rights.
  Under our legislation, the first generic applicant would forfeit that 
180 days of exclusive market rights if it failed to go to market during 
that time, or entered into an agreement with a brand name company that 
the FTC determines to be anti-competitive. I think that would help end 
or eliminate altogether the kinds of deals between the brand name 
manufacturer and the generic manufacturer that are such a disservice to 
consumers.
  The original Hatch-Waxman act was a carefully constructed compromise 
that balanced an expedited FDA approval process to speed the entry of 
lower cost generic drugs into the market with additional patent 
protections to ensure continuing innovation.
  Regrettably, however, the law now needs to be strengthened and 
reformed so we can eliminate the abuses that we are seeing. This 
bipartisan compromise bill restores that balance by closing the 
loopholes that have reduced the original law's effectiveness in 
bringing

[[Page 13040]]

lower cost generic drugs to market more quickly. Increasing access to 
these lower cost alternatives is all the more important as we begin 
work to provide an affordable and sustainable Medicare prescription 
drug benefit.
  Mr. President, I urge all our colleagues to join me in supporting 
this legislation. It will do a great deal to make prescription drugs 
more affordable by promoting competition in the marketplace and 
increasing access to lower price generic drugs.
  I yield the floor.

                               Exhibit 1

                                       Coalition for a Competitive


                                        Pharmaceutical Market,

                                    Washington, DC, July 10, 2002.
     Hon. Edward M. Kennedy,
     Chairman, Senate Health, Education, Labor and Pensions 
         Committee, U.S. Senate, Washington, DC.
       Dear Mr. Chairman: As a broad-based coalition of large 
     employers, consumer groups, generic drug manufacturers, 
     insurers, labor unions, and others, we are writing to advise 
     you of our strong support for the Edwards/Collins amendment 
     to S. 812, the Greater Access to Affordable Pharmaceuticals 
     Act. We believe it is critical that Congress act this year to 
     pass legislation that would eliminate barriers to generic 
     drug entry into the marketplace. The legislation you will be 
     marking up today clearly would accomplish this long-overdue 
     need.
       Prescription drug costs are increasing at double-digit 
     rates, and clearly are unsustainable. Current pharmaceutical 
     cost trends are increasing premiums, raising copayments, 
     pressuring reductions in benefits, and undermining the 
     ability of businesses to compete in the world marketplace. We 
     believe that a major contributor to the pharmaceutical cost 
     crisis is the use of the Drug Price Competition and Patent 
     Term Restoration Act of 1984 clearly in ways unanticipated by 
     Congress, which effectively block generic entry into the 
     marketplace. The repeated use of the 30-month generic drug 
     marketing prohibition provision and other legal barriers have 
     resulted in increasingly unpredictable and unaffordable 
     pharmaceutical cost increases.
       Although the compromise amendment being offered today does 
     not totally eliminate the 30-month marketing prohibition 
     provisions, as would be our preference, it does make 
     important process changes that will lead to a more 
     predictable, rational pharmaceutical marketplace. We 
     recognize that compromises have been necessary to garner the 
     support of a majority of the Members of the Committee and 
     appreciate your leadership and the hard work of your staff. 
     However, we would strongly oppose any additional amendments 
     that would undermine the intent of this legislation by 
     further delaying generic access or reducing competition and 
     increasing costs to purchasers. We also remain opposed to 
     legislation that would increase costs to purchasers either 
     through extended monopolies or unnecessary and costly 
     litigation.
       We are convinced that the legislation you are advocating 
     will make a major difference in increasing competition in the 
     marketplace and enhancing access to more affordable, high 
     quality prescription drugs. We look forward to working with 
     you and other Members of the HELP Committee to ensure that 
     this important legislation is enacted this year.
       The Coalition for a Competitive Pharmaceutical Market is an 
     organization of large national employers, consumer groups, 
     generic drug manufacturers, insurers, labor unions, and 
     others. CCPM is committed to improving consumer access to 
     high quality generic drugs and restoring a vigorous, 
     competitive prescription drug market. CCPM supports 
     legislation eliminate legal barriers to timely access to less 
     costly, equally effective generic drugs.
       CCPM Participating Members: American Association of Health 
     Plans; Aetna; Anthem Blue Cross and Blue Shield; Blue Cross 
     and Blue Shield Association; Caterpillar, Inc.; Consumer 
     Federation of America; Families USA; Food Marketing 
     Institute; Generic Pharmaceutical Association; General Motors 
     Corporation; Gray Panthers; Health Insurance Association of 
     America; IVAX Pharmaceuticals; National Association of Chain 
     Drug Stores; National Association of Health Underwriters; 
     National Organization for Rare Disorders; Ranbaxy 
     Pharmaceuticals; TEVA USA; The National Committee to Preserve 
     Social Security and Medicare; United Auto Workers; Watson 
     Pharmaceuticals; and WellPoint Health Networks.
                                  ____



                             Business for Affordable Medicine,

                                    Washington, DC, July 10, 2002.
     Hon. Susan Collins,
     U.S. Senate,
     Washington, DC.
       Dear Senator Collins: The Business for Affordable Medicine 
     coalition encourages you to support the Edwards-Collins 
     amendment to the 1984 Drug Price Competition and Patent Term 
     Restoration Act (Hatch-Waxman Act).
       The Senate Health, Education, Labor and Pensions Committee 
     is scheduled to vote today on legislation to close loopholes 
     in the Hatch-Waxman Act that delay competition and prevent 
     timely access to lower-priced generic pharmaceuticals. Your 
     vote for the Edwards-Collins amendment will ensure genuine 
     reform for all Americans who face barriers to affordable 
     medicine.
       BAM members hope to continue working with the Committee and 
     the Administration on appropriate enforcement mechanisms that 
     avoid unnecessary and costly litigation.
       Consumers and institutional purchasers (including 
     employers, and federal and state governments) can no longer 
     afford the anti-competitive practices that are made possible 
     by loopholes in the Act. Now is the time for Congress to 
     restore the original intent of the Hatch-Waxman Act--no more 
     gaming of the system at the expense of purchasers across 
     America.
       Please take a moment to review the attached information, 
     including a letter from BAM member governors outlining their 
     concerns about this costly issue and the need for real 
     reform. For more information about BAM, please visit our 
     webswite at www.bamcoalition.org.
       Thank you for your assistance in making Hatch-Waxman Act 
     reform a reality during the 107th Congress.
           Sincerely,
     Jody Hunter,
       BAM Co-Chair, Director, Health and Welfare, Georgia-Pacific 
     Corporation.

  The PRESIDING OFFICER (Mr. Miller). The Senator from Michigan is 
recognized.
  Ms. STABENOW. Mr. President, I appreciate the opportunity to speak 
once again on this very important topic of lower prices of prescription 
drugs and providing real Medicare prescription drug benefit. I join my 
colleague in speaking to the fact that we need to pass the bill that 
came out of the committee to close generic loopholes and stop the drug 
companies from gaming the system. I think everyone should be commended 
for bringing this to the floor. I appreciate the fact that they have 
done that.
  The frustrating thing at this point is, despite the fact that there 
was an overwhelming bipartisan vote to bring this legislation to the 
floor so we could begin to add to it--add medicare prescription drug 
coverage, add other ways to increase competition and lower prices--we 
come this week with great anticipation of this debate to work together 
and work out all the details after a vote of 16 people saying yes in 
committee to only 5 saying no, a bipartisan vote--we come to the floor 
last night, and a colleague on the other side of the aisle objects to 
us proceeding even to the bill.
  Colleagues come and talk about concerns about working out details, 
which we want to do, we know we have to do, and we will do. But we are 
being stopped. In fact, the clock has been ticking since last night and 
we are not even able to bring this issue before the Senate. It is 
amazing to me that, with the importance of this issue and all the words 
that have been spoken on this floor and the House, during Presidential 
campaigns and all the campaigns that we have been involved with--we 
come to the moment of truth of being able to bring this to the floor 
for debate and, instead, we are seeing an attempt to stall. We are 
seeing an attempt to hold us up from proceeding. That is of great 
concern.
  I have great respect for my colleague from New Hampshire, but I 
disagree with this approach, and I urge him to reconsider and give us 
the opportunity to bring this to the full Senate.
  Mr. GREGG. Will the Senator yield?
  Ms. STABENOW. I am happy to yield.
  Mr. GREGG. Mr. President, I ask unanimous consent that we proceed to 
the bill; we vitiate the vote on cloture and proceed to the bill.
  The PRESIDING OFFICER. The Senator cannot make such a request until 
he has the floor.
  Mr. GREGG. Will the Senator yield for me to make that request? The 
Senator suggested I make the request. I am willing to make it.
  Ms. STABENOW. I would be happy to yield.
  Mr. GREGG. I ask unanimous consent----
  The PRESIDING OFFICER. The Senator from New Hampshire is recognized.
  Mr. GREGG. I ask unanimous consent we vitiate the cloture vote and 
proceed to the bill.

[[Page 13041]]

  The PRESIDING OFFICER. Is there objection? The Senator from 
Massachusetts.
  Mr. KENNEDY. Mr. President, this is an interesting proposal. It is 5 
o'clock in the afternoon now on Tuesday. We had the opportunity last 
evening to lay down the bill. We could have considered the amendments 
during the course of the day and made some real progress on it. But it 
was the determination of the other side not to permit us to do that.
  Mr. GREGG. Regular order. Regular order, Mr. President.
  Mr. KENNEDY. The regular order is----
  The PRESIDING OFFICER. Does the Senator object?
  Mr. KENNEDY. I am reserving my right to object.
  Mr. GREGG. Regular order. I ask for regular order.
  Mr. KENNEDY. Mr. President, I understand that under the regular 
order, I have a right to object, and I----
  The PRESIDING OFFICER. The Senator has a right to object. But not 
make a speech.
  Mr. KENNEDY. Pardon? No?
  Mr. GREGG. I ask for regular order. Either objection should be or not 
be made.
  Mr. KENNEDY. Objection.
  The PRESIDING OFFICER. Objection is heard. The Senator from 
Massachusetts.
  Mr. KENNEDY. Mr. President, we had the opportunity to go to this bill 
last evening. We have been waiting here all day long in order to take 
action on this legislation. Legislation that can have a direct impact 
in terms of the cost of prescription drugs and also on coverage.
  Now at 5 o'clock, the Senator comes here without any kind of notice 
and makes this request. I think the American people are entitled to 
know why, since the Senator from New Hampshire was the one who 
originally objected to bringing up the bill. I would be prepared to 
vote right now on whether to proceed to the bill if the Senator wants 
to call off tomorrow's cloture vote.
  But if the Senator is objecting to the bill on substantive grounds 
last night, I think the American people are entitled to know where 
their Senators stand on considering this legislation. If the Senator 
wants to do it tonight, that is fine with me. If he does not care to do 
it tonight, we will follow the regular order and tomorrow when the roll 
is called--as it will be done here in the Senate--when the roll is 
called, we will find out. The American people will find out who 
believes we ought to move ahead with this legislation. That is the way 
it should be.
  There has been objection raised to the majority leader to moving 
ahead. Now I think, since this issue has been raised during the course 
of the debate, during the course of the day, the American people are 
entitled to know who is going to be for this particular legislation.
  That is why I have raised that issue.
  Mr. SCHUMER. Will the Senator yield for a question?
  Mr. KENNEDY. I believe I have the floor.
  The PRESIDING OFFICER. The Senator has the floor.
  Mr. KENNEDY. Mr. President, I think it is wise, if we are going to 
conduct our activities, that we do it in the light of day rather than 
the twilight of the evening. We ought to have the chance to have an 
open kind of a process. We have the Senator from Michigan here who has 
been waiting to make an excellent presentation. I was engaged in a 
conversation with my friend and colleague from Maine about this. 
Suddenly, there is a unanimous consent request to just go ahead with 
the legislation.
  I think we ought to conduct a full debate on this issue, which is of 
such importance and consequence to families across the country in terms 
of the cost, availability, and accessibility of prescription drugs. And 
we ought to do it in the light of day. We ought to have a good debate 
on this issue.
  But since there has been objection to the majority leader proceeding 
to this issue, because evidently the Committee did not conform to the 
understandings of certain Senators, and there has been objection raised 
from that side of the aisle during the course of discussion and debate, 
I am going to insist that the Senate go ahead and have a roll call 
vote. We are going to vote on this. And the American people will 
understand who is for moving ahead with this legislation and who is 
not. Hopefully, we can then make progress on this legislation. We will 
consider amendments and begin the substance of this debate rather than 
just the general debate.
  I would be glad to yield to the Senator from New York. I believe I 
have the floor. The Senator from New York has asked for me to yield for 
a question.
  Mr. SCHUMER. I thank the Senator. I appreciate his yielding. I want 
to make an inquiry of him. I am, in fact, in accord with what my friend 
from Massachusetts said.
  We have now spent all day today. We could have spent it debating 
amendments and moving the bill forward. We might have even been able to 
go forward on Friday. All of a sudden, after all of this, when we can't 
accomplish anything, when we can't accomplish amendments, our good 
friend from New Hampshire comes up and says: Never mind.
  Well, there is a reason we think we ought to have a vote. We ought to 
see where people are. We ought to avoid this from happening another 
time. What if it happens again 2 days from now? What if there is an 
amendment that gets somebody upset and they decide to filibuster again? 
Then we are in the middle of debating access, or in the middle of 
debating Canadian reimportation.
  Let us see where the cards are. Let us see if there was a real reason 
to delay and delay and delay. Let us see where the votes are. Do people 
really want a delay? This idea of spending a whole day--I don't mind 
it. I like this issue. I have fun talking about it. I think it is good 
that the American people hear about it. But I would rather be voting on 
amendments. I would rather be crafting legislation. I would rather be 
reducing the cost of drugs to my constituents from Buffalo to Montauk 
from Plattsburgh down to Brooklyn.
  I completely agree with my friend from Massachusetts. If you want to 
have a vote now so we can avoid these games in the future, by all 
means. But if you don't want to have that vote now, then let us wait 
until tomorrow. Let's have a vote on this. God knows we have spent 
enough time debating the issue.
  I thank him for making that point so well and so forcefully.
  Mr. KENNEDY. I see the Senator from Michigan has asked to be 
recognized. I yield to her.
  Ms. STABENOW. Mr. President, I appreciate very much having the 
opportunity as well to raise the issue. I appreciate how our friend 
wants to move ahead with this issue. But we certainly want to make sure 
we have a vote so that we know that in fact we can proceed.
  I ask of our leader, the Senator from Massachusetts: In order for us 
to guarantee that we can proceed and that this will not happen again in 
the future, is it his assumption that it is best for us then to move 
ahead to a vote so we may guarantee in fact, as my friend from New York 
said, that we don't have this happening again and not just a series of 
filibusters in order to stop us from moving ahead on this important 
issue?
  Mr. KENNEDY. I thank the Senator. I intend to yield the floor. I will 
insist on the regular order so that we have a chance to vote on this 
tomorrow.
  I see my friend and colleague, our leader from Nevada, wishes to 
address the Senate. Obviously, I would follow the leadership in terms 
of when that vote would occur. If the request is that we move ahead 
with a vote this evening, I will certainly support that proposal.
  (Several Senators addressed the Chair).
  The PRESIDING OFFICER. The Senator from New Hampshire.
  Mr. GREGG. Mr. President, crocodile tears are being shed here, I see. 
We agree to vitiate the vote. But we didn't want to vitiate the vote. 
We agree to proceed to the bill. We don't want to

[[Page 13042]]

proceed to the bill. All day we heard about how outrageous it was that 
we were having to go to a vote. Suddenly, crocodile tears appear to be 
shed early today.
  My reason for suggesting that we vitiate the vote was in response to 
the specific comments of the Senator from Michigan. The Senator from 
Michigan came to the floor and called upon me by name and by State to 
proceed with the bill. That is what the Senator from Michigan called 
upon me to do.
  I ask if it is possible to read back the statement the Senator from 
Michigan made just prior to the most recent exchange.
  The PRESIDING OFFICER. The statement would have to be obtained from 
the Official Reporters.
  Mr. GREGG. I will represent--and hopefully people will take the 
representation as accurate--that the Senator from Michigan was on the 
floor asking why I was slowing the bill down and called on me to----
  Ms. STABENOW. Will my colleague from New Hampshire yield?
  Mr. GREGG. I would be happy to yield for a question.
  Ms. STABENOW. I was here at 10 o'clock this morning asking that, and 
I think it would have been very appropriate if you had been here at 10 
o'clock this morning. We would have welcomed that. We have all day been 
asking that. Now we are at a point where I think the concerns of my 
friend----
  The PRESIDING OFFICER. The Senator from New Hampshire yielded for a 
question.
  Ms. STABENOW. I ask why you were not with us this morning. We have 
been asking all day.
  Mr. GREGG. I appreciate that question. I wasn't here this morning 
when you asked that question. But there is a tempo to this body. And 
the tempo involves putting on the Record the reasons this bill was, in 
my opinion, being brought forward in a manner which was inconsistent 
with the agreements which had been reached, in my opinion, within the 
committee.
  There are two items that were represented as being fixed before the 
bill came to the floor, in my opinion. Neither of those items was 
corrected. The bill has had a very short shelf life. It was introduced 
last--we saw it for the first time, I believe, last Wednesday morning. 
It was passed last Thursday, and it was on the floor without a report 
on Monday.
  During that period of it being passed in the committee on Thursday, 
there was an understanding between Senator Edwards and myself that part 
of the bill was incorrect and it would be fixed. Between Senator Frist 
and Senator Edwards, there was another part of the bill that was 
incorrect which would be fixed.
  For me, it seems inappropriate to move to the bill in such rapidity 
without having made that point--that point I spent a considerable 
amount of time making this morning and this afternoon, and which I am 
happy to continue to make.
  But as a practical matter, I think the point has been made. I am 
willing to proceed to the bill, as the Senator from Michigan said. She 
came to the floor while I was here. I wasn't here this morning. 
Regrettably, I didn't hear your excellent speech. I am sure it was an 
excellent speech. But I was here to hear your last excellent speech. In 
response to it, I thought: Gee, let us proceed to the bill rather than 
have a vote tomorrow. We can have a vote tomorrow. I would counsel 
everyone to vote in favor of it, if they can.
  Mr. SCHUMER. Will the Senator yield?
  Mr. GREGG. I will yield in a second.
  But the question was why I made this statement. It was because the 
Senator from Michigan asked me. I was stunned, startled, and surprised 
by the Senator from Massachusetts who, upon--and I understand that he 
was in a conversation and probably didn't hear the Senator from 
Michigan ask me. But had he heard the Senator from Michigan ask me, I 
am sure he would have said that is a reasonable response to the Senator 
from Michigan, I agree with it, and we should move to a vote.
  I am also surprised that someone on the other side of the aisle is 
objecting to proceeding to the issue without a vote. If that is the 
case, that is the case; so be it; let us have the vote tomorrow. But if 
you want to proceed to the issue right now, I am perfectly willing to 
do that without a vote.
  Mr. SCHUMER. Will the Senator yield for a question, my good friend?
  Mr. GREGG. I will yield for a question. I am sure it will be an 
excellent question.
  The PRESIDING OFFICER. The Senator from New Hampshire yields for a 
question.
  Mr. SCHUMER. I thank the Senator.
  He knows from the days we played basketball together in the House gym 
that my questioning ability is about equal to my basketball playing 
ability--not very good. But I would simply ask him a question.
  If he wishes to move to the bill, and understanding that some of us 
feel a little grieved that we debated this all day, why would he object 
to us having a vote right now and then moving to the bill?
  Mr. GREGG. I would answer the question, because my colleague from New 
Hampshire is in New Hampshire attending a funeral. I would otherwise be 
happy to move to the vote right now.
  I renew my request that we proceed to the bill.
  The PRESIDING OFFICER. Is there objection?
  Mr. KENNEDY. Mr. President, I object.
  The PRESIDING OFFICER. There is objection.
  Mr. REID addressed the Chair.
  The PRESIDING OFFICER. The Senator from New Hampshire still has the 
floor.
  Mr. GREGG. I yield the floor.
  The PRESIDING OFFICER. The Senator from Nevada is recognized.
  Mr. REID. Mr. President, I have the opportunity to spend a lot of 
time on the floor and I see what goes on here more than this very 
important piece of legislation dealing with prescription drugs. For 
months and months, I have seen this. I have watched what has gone on. 
And it does not matter whether it is election reform, whether it is the 
energy bill, whether it is terrorism insurance, the supplemental 
appropriations bill, the Department of Defense authorization bill, or, 
as a couple hours ago, trying to move to military construction 
appropriations, it does not matter what we do, we cannot do it because 
they will not let us.
  This is no different. And the answer is, you know, we can talk about: 
Sure, let's do it today. We will do it right now--after we have wasted 
actually 2 days--not 1 day, 2 days. Today is Tuesday.
  This is the same on every piece of legislation with which we deal. 
And the reason is they do not want us--``they,'' meaning the Republican 
minority, do not want us to deal with this legislation--this 
legislation, election reform, energy, terrorism insurance, the 
supplemental, DOD authorization.
  And the game does not stop with cloture on getting the bills to the 
floor with a motion to proceed. It is one thing after another. No, they 
don't want a 3-to-2 breakdown on the conference committee. They want 4 
to 3. Or it doesn't matter what it is, we can't do it right.
  But, Mr. President, we have the ability to persevere. And we have 
been able to pass election reform in spite of their not wanting us to 
go to it. We have been able to pass an energy bill in spite of their 
not wanting us to go to it. We have been able to pass a good terrorism 
bill in spite of not being able to get to it for weeks and weeks and 
weeks. We have passed a supplemental bill that is a good bill. The 
Department of Defense authorization bill is a good bill.
  We have the ability to persevere and we are going to do it on 
prescription drugs. They can stall us for days. That is what this is 
all about, the big stall. That is one thing I have learned. I know what 
this is: stall, delay. And, of course, the Senator from Massachusetts 
is absolutely right; that is all this is about.
  I have the greatest respect for the senior Senator from New 
Hampshire. He is good and he knows Senate procedures. He served in the 
House and was Governor of New Hampshire. And he is now a Senator, 
senior Senator. He

[[Page 13043]]

knows the rules. He knows they have gotten 2 days on us on this bill to 
prevent us from offering amendments. I would like to spend some time on 
the Graham-Miller legislation, which the vast majority of the Senate--
Democrats--support. It is good legislation. We should have been 
debating that all day today, and started on it yesterday.
  No, we will not be able to do it. And the word has come from the 
other side that the minute it comes up--the minute it comes up--they 
are going to raise a point of order. And so the longer they stall on 
that, the less opportunity it will give us to talk about substantive 
issues.
  So I am not surprised. This is the way it has been. They are going to 
continue to do this because they do not want the Senate Democrats to 
have victories. And we are having them in spite of having to fight 
every step of the way--every step of the way--to get where we need to 
go.
  Mr. GREGG. Will the Senator yield for a question?
  Mr. REID. I am happy to yield to my friend from New Hampshire for a 
question.
  Mr. GREGG. I am willing to give you a victory. I am saying: You win. 
Proceed to the bill.
  Mr. REID. Let me respond to my friend. I also understand this, that 
you have stalled for 2 days, at least. I think we can count Friday as 
another stall day.
  Mr. GREGG. The bill wasn't passed until last Thursday.
  Mr. REID. You stalled for 2 days. And here we now have a situation 
where, after having wasted 2 days, we now are in a situation where you 
say: OK, let's just go to it.
  It is 5 o'clock tonight. You have told us your friend in New 
Hampshire has a funeral. I also spoke to our colleague from New 
Hampshire. He said: Do you think there are going to be any votes? I 
said: It looks like you're not going to give us any votes. I said: I 
would hope we would have a vote on military construction. Right out 
here at about 2:30 today he and I visited.
  So I say your statement that our colleague from New Hampshire is at a 
funeral--I am glad he is attending a funeral. I am glad he was able to 
go there. I think it is the right thing to do. But what I say, if going 
to a funeral isn't an excuse for missing a vote, there isn't one that 
exists in the world. So I think that is a very poor excuse for our not 
voting on this tonight.
  If, in fact, you want us to go forward, I ask unanimous consent that 
we vote on cloture right now. Let's say at 5:45. Give people an 
opportunity to get here. We vote. I will spread on the Record that 
anyone who questions the junior Senator from New Hampshire not being 
here for the vote--I will personally campaign against that person and 
say that it is wrong for anyone to raise that as an issue.
  The PRESIDING OFFICER. Is there objection?
  Mr. GREGG. Reserving the right to object, I would actually note I am 
actually the junior Senator from New Hampshire. But independent of that 
subtlety----
  Mr. REID. Let's say, you don't act like the junior Senator.
  Mr. KENNEDY. Not all the time.
  Mr. GREGG. Let me make the point, we do not need a vote because I am 
willing to agree to go to this without a vote. But if we are going to 
have a vote, let's have it when it was originally scheduled, which is 
tomorrow at 10:30 or 9:30, whatever it was. So I would object.
  The PRESIDING OFFICER. Objection is heard.
  Mr. REID. I say to my friend from New Hampshire, we have had people 
who have told us they didn't want us to go forward. And I think they 
should be called here and cast a vote and see how--I don't like to use 
words like this, so I will not use the word ``phony''--let's say 
deceptive.
  Here they are now. They are saying: We aren't going to let you go to 
this, but we don't want to vote on it. I want them to vote on it. 
Probably the vote will be 98 to 0. We will show how fallacious and 
foolish and wasteful it was not allowing us to go forward on this 
anyway.
  Mr. GREGG. If the Senator will yield for a further question, I think 
the Senator's knowledge of process around here certainly exceeds mine 
and, obviously, it borders on genius. And, therefore, I suspect the 
Senator knows there are ways in which to get one's point across in this 
institution which involve procedural activities.
  My purpose in raising this issue was to get my point across, that I 
believed the bill was coming to the floor without having been 
adequately structured as to how it was going to leave the committee. 
Now, I made my point. I am happy to move on without a vote. There will 
be a vote tomorrow, if you wish to have it, and it will probably be 98 
to 0.
  Mr. REID. Does my friend have a question?
  Mr. GREGG. My question is, Why do you need a vote?
  Mr. REID. For the reasons that have been outlined, in detail, by the 
Senator from Massachusetts, and by me.
  So I ask unanimous consent that the cloture vote on the motion to 
proceed to Calendar No. 491, S. 812, occur at 10:30, Wednesday morning, 
July 17, and that the time until the cloture vote be equally divided 
and controlled between Senators Kennedy and Gregg or their designees; 
and that the mandatory quorum under rule XXII be waived; that 
immediately following the vote, if cloture is invoked, the motion to 
proceed be agreed to, and the Senate begin consideration of S. 812.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  Mr. REID. Mr. President, the majority leader has asked that I 
announce there will be no more votes today.
  I would say, after having said that, that is really too bad. What a 
time to do military construction today. We would take 20 minutes, plus 
45 minutes. We would finish that bill and send it to the President.
  Now, I would say that my friend from Arizona complained because he 
wants firemen. I have checked with Nevada. I will be very brief. I know 
people want to talk on prescription drugs, which they should, but in 
Nevada--you know, my friend from Arizona is complaining he wants to 
make sure there is going to be money to fight these fires--we have the 
Mud Springs fire covering 4,000 acres; Eagle fire, 10,000 acres; 
Buckeye fire, 850 acres; Ellsworth fire, 1,200 acres. They are burning 
right now--the Belmont fire, 650 acres; Cold Springs fire, 1,000 acres; 
Adobe fire, over 500 acres; Bridgeport fire, 250 acres; Pony Trail 
fire, 100 acres; Lost Cabin fire, 1,500 acres.
  I am willing to do what we always have done: Wait until the money 
comes forward in the Interior appropriations bill. We have already 
established that the President should push this in the supplemental. He 
has not done that. Maybe he will do that. That is no excuse, no reason 
for not going forward with this bill.
  As I outlined following Senator Kennedy's statement, it is a sham. 
Everything we do here is an ordeal. It is an ordeal to get money to 
take care of construction needs for our military around the world. I 
repeat, election reform, energy, terrorism, supplemental 
appropriations, DOD, the corporate security bill, whatever it is, the 
big stall takes place. And we are able, in spite of that, to work our 
way through the system and declare some victories for the American 
people. We are going to continue to do that.
  The PRESIDING OFFICER. The Senator from Massachusetts.
  Mr. KENNEDY. Mr. President, I will just take a minute or two, and 
hopefully the Senator from Michigan will be able to complete her 
statement. She has been here all day long. She has yielded to all of 
the interventions. She has a determination that cannot be matched, but 
she also has patience and grace that can't be matched either. I will 
just take a moment, and hopefully she will be recognized.
  Just as a general matter, this legislation is enormously important. 
We have all said that during the course of the day. I hope at the start 
of the substantive debate we can have a sense of civility about how we 
are going to proceed. If there are legitimate kinds of concerns, as 
expressed by the Senator from New Hampshire about being unwilling to 
permit the Senate to move

[[Page 13044]]

forward, I will take those. I don't agree with them, and I think they 
are misplaced for reasons I have outlined, but I can understand those. 
Then we are going to play by the rules.
  But I would hope, as we begin this extraordinarily important debate 
and discussion, that we will free ourselves from gamesmanship and 
surprises. Let's try and deal with this important issue. Let's share 
our amendments if we are going to call them up. Let's get back to a 
sense of civility. People have strong views. This is enormously 
important. The underlying legislation and these amendments are 
incredibly important.
  People are entitled to have the full attention and consideration of 
the Members of this body and to be free of the gamesmanship that too 
often takes place. I hope at the start of this, we will have that as a 
basis on the way to proceed. I think the American people expect no 
less. There has been objection, as has been pointed out, to our 
considering this. This is too important. The American people will see 
with tomorrow's vote on the will of the Senate, whether this 
legislation is flawed in some way or whether we ought to proceed to it.
  As the Senator from Nevada has pointed out, we are prepared to have 
that vote this evening as a roll call vote, so that the American people 
can see, after listening to this debate all day long and after the 
allegations and charges that were made about the incompleteness of the 
legislation, whether there are substantial Members of this body who 
don't feel we ought to go ahead, or whether the majority believe we 
should go ahead.
  At the beginning of this debate, which will take some time and is 
very important, let's hope we can proceed in a way that is worthy of 
this institution.
  I thank the Senate.
  The PRESIDING OFFICER. The Senator from Pennsylvania.
  Mr. SANTORUM. Mr. President, I want to comment on some of the remarks 
of the majority whip and some of the comments of the chairman of the 
committee with respect to this legislation.
  No. 1, the junior Senator from New Hampshire has every right, as 
ranking member of the committee, to be outraged at the way this bill 
was brought to the floor. It is my understanding, listening to him 
today and from the discussion in committee, that there were certain 
commitments made with respect to bringing this bill to the floor. The 
fact is, the reason we have seen delays on the floor on the energy 
bill, the terrorism insurance bill, election reform, a variety of other 
bills, was because those bills had bypassed committees. They had been 
brought straight to the floor.
  Now we are talking about another bill, the Medicare drug bill, which 
will be amended, attempted to be amended, to this underlying bill that 
will be bypassing the committee and brought straight to the floor. What 
is the underlying bill? A bill that was introduced on Thursday and now 
is on the floor. No one had seen it. I am still trying to understand 
this legislation. It is very technical, very complex. It is very 
important to my State, in which there is a lot of drug manufacturing. I 
am still trying to understand the complexity of what this bill actually 
does. It is here on the floor, and we are asked to just move ahead.
  The Senator from New Hampshire had some understanding of what was 
going to be changed. As you know, when you are marking up a bill in 
committee, markups are not about legislative language. There are 
concept documents that are then put into legislative language and 
brought to the floor. The Senator from New Hampshire had understandings 
and those understandings were not incorporated into this legislation.
  The Senator from New Hampshire had a right to come to the floor and 
explain his dissatisfaction with this procedure. We have two procedures 
set up: No. 1, you completely bypass the committee; No. 2, you go 
through committee, and then you don't bring the bill out that you say 
you are going to from committee.
  The Senator from New Hampshire simply wanted to make that point. As 
you know, in the Senate we have the opportunity to put a halt on things 
temporarily so you can make a point. The point is, procedurally this 
Senate is being run amok, whether it is the work now coming out of 
committee or, more often than not, it is the work that is not even done 
in committee.
  I don't know why we have a Finance Committee, much less a chairman of 
the committee, because every important issue the Finance Committee has 
had to deal with this session has been bypassed. The committee has been 
bypassed.
  Whether it is taxes or Medicare prescription drugs, I cannot think of 
any two issues more important--I also include trade--the three most 
important issues Finance deals with: trade, taxes, and health care--of 
the three major issues of this session of Congress, the Finance 
Committee and the chairman were simply bypassed. Partisan bills were 
brought straight to the floor.
  Why are we discussing this underlying bill? They brought this bill up 
because this is the vehicle by which to talk about health care because 
they couldn't get their prescription drug bill through the committee. 
They couldn't get the Democrat prescription drug bill through committee 
because it is a partisan approach. It will get no bipartisan support. 
It has no scoring. It has not even been written yet. It is still being 
worked on.
  The bottom line is, they couldn't get that through committee. 
Actually, the bill that would have come out of committee--I am fairly 
confident--the bill that would have come out of committee would have 
been a bipartisan bill. But it wouldn't have been a bill that the 
majority leader wanted. So he takes the gavel out of the hand of the 
chairman and runs the bill straight to the floor; that is, his bill. 
That is a partisan bill.
  Why does he do that? We are still operating on last year's budget 
agreement. Last year's budget agreement requires two things of a 
Medicare prescription drug bill: No. 1, that it be within the budget 
amount, which I believe is $300, $350 billion in number--it has to be 
that number or under--No. 2, it has to be reported from the Finance 
Committee.
  So here is the state of play now because we are playing politics with 
prescription drugs instead of trying to do prescription drugs. We are 
playing politics. Why? Because any bill that is offered in the Senate 
that provides a prescription drug benefit for seniors will be subject 
to a point of order which is 60 votes. Why? Because it was never 
reported through the Finance Committee. Why? Because the majority 
leader refused to let the Finance Committee mark up a bill.
  So what has he done? He has set up a game where he has placed the bar 
so high that no benefit will pass the Senate. Why? Morton Kondracke 
answered that in Roll Call when he said it is obvious the Senate 
Democrats wanted the issue more than the prescription drug coverage for 
seniors. They would rather have the issue this fall than the drug 
coverage for seniors as soon as possible.
  I have not been around that long. I have been around since 1991. But 
since I have been here in the House and in the Senate, I have noticed 
one thing: When it comes to dealing with the big issues of the day, 
particularly health care, taxes, Social Security, et cetera, by and 
large--particularly with Social Security and Medicare entitlements--you 
cannot pass one of these pieces of legislation without a bipartisan 
consensus. You cannot do it, and I argue that you should not do it. You 
should try to work together to get a consensus. If you are serious 
about getting a bill through the Senate on prescription drugs, you 
cannot bypass the committee, bypass bipartisan agreements, bring a 
partisan bill to the floor, play games of 60-vote points of order, and 
claim you tried and the other side blocked you from succeeding, which 
is exactly the way this is going to play out.
  Let's have no illusions as to how this will end. This is not a 
serious discussion, folks, of getting prescription drugs for seniors. 
This is a serious campaign rhetoric debate about who is for

[[Page 13045]]

seniors more, knowing full well, the way the game was set up, seniors 
will lose, no matter what happens.
  If you were serious about getting a prescription drug benefit for 
seniors, you would take it through the Senate Finance Committee and 
they would do the work that should not be done on the floor of the 
Senate. You have folks on the Finance Committee who have waited years 
and years to get on that committee and have studied these issues very 
hard, such as the Senator from Massachusetts, who is an expert in the 
areas under the Labor Committee's jurisdiction. He is an expert. He has 
been working on these issues. This is his area of expertise in 
legislating. When the Finance Committee deals with welfare, taxes, 
trade, Medicare, and health care, this is their area of expertise. They 
work together. This is a dynamic. That is how committees work. They 
work together and find compromise. They understand the real intricacies 
of the issues, and they work together to knead together legislation 
that will work and come to the floor without all of the different 
problems that confront a virgin piece of legislation that is dreamed up 
in some back room somewhere.
  That is how the process works to help the Senate do its work. You 
build consensus in committee. You get Democrats and Republicans working 
together to form agreements and coalitions, to bring a bill to the 
floor so you can continue that. That has all been thrown out the 
window. Why? This bill is about partisan politics. This bill is about 
the November election. This is not about providing prescription drugs 
for seniors.
  This is really tragic. It is amazing to me that the Senator from 
Nevada would complain about losing 2 days. We are going to lose 2 weeks 
in the Senate. We are going to spend 2 weeks debating health care 
issues that, because of the procedure that has been set up, will never 
pass the Senate, because we have set up a procedure that is doomed to 
fail, we have set up a procedure that does not allow bipartisan 
cooperation.
  We have a bill introduced by members of the Senate Finance 
Committee--a tripartisan bill--that would have passed the committee, 
that could have come to the floor. A lot of the problems already could 
have been worked out. We could have spent less time, not more time, 
here in the Senate. If we really wanted to do a prescription drug bill, 
we could have let the Finance Committee do its work and we would have 
had the issues narrowed as a result of that. We could have come to the 
Senate floor and worked together and tried to get a bipartisan bill 
that could be conferenced with the House, so we could get a Medicare 
prescription drug bill. But a prescription drug bill is a partisan 
issue now. That is the result of this procedure we have going right 
now.
  I don't understand why we say we have lost 2 days. We just voted on 
the corporate accountability and accounting bill at 7 o'clock last 
night. We had amendments and debate going on up until then--which would 
be allowed. There were amendments that were not allowed to be offered. 
We had debate going on and we had 4 or 5 votes last night. So I don't 
know how we have lost 2 days. The Senator from New Hampshire, about an 
hour ago, said he would be willing to vitiate the vote. There has been 
plenty of time for Members to lay down amendments. I think I can 
stipulate for the record, if anybody on the other side would care to 
have the stipulation as a satisfactory admission on our part, the vote 
tomorrow will be unanimous to move to proceed to the bill.
  I don't think there is any question that every Member on this side 
wants to proceed to the bill. We want to talk about prescription drugs. 
We want to have our ideas. We have three different plans on this side 
of the aisle that are supported by various Members. Senator Smith from 
New Hampshire and Senator Allard have a plan, Senators Ensign and Gramm 
have a plan, and the tripartisan plan that is supported by many 
Republicans, all of which I think bring a tremendous contribution to 
the debate. We will have good discussions about it.
  I know the Senator from Nevada said he wishes we had the Democratic 
prescription drug bill up. I hope the Senator from Nevada offers that 
bill right out of the shoot. I hope we do have a vote on that tomorrow, 
or lay down that bill and have a discussion about it. I think it would 
be great.
  Mr. REID. Will the Senator yield for a question?
  Mr. SANTORUM. Yes.
  Mr. REID. Would the Senator from Pennsylvania support, then, an up-
or-down vote on the Graham-Miller bill that you just talked about? Do 
you want to debate that, and would you be willing to have an up-or-down 
vote?
  Mr. SANTORUM. I think we should have up-or-down votes on every plan I 
just listed. If the Senator would agree to up-or-down votes on the 
tripartisan plan and the other two plans I just listed, which are 
serious legislative proposals, I think there would be no question you 
would easily get an agreement to have an up-or-down vote on the point 
of order on all of those.
  Mr. REID. I am not talking about a point of order. I asked the 
Senator from Pennsylvania if he would give us an up-or-down vote on the 
Graham-Miller prescription drug benefit plan.
  Mr. SANTORUM. Obviously, the procedure by which this bill has been 
brought to the floor has tainted this entire process. I believe, 
actually, the best chance we have to get the high-water mark--in other 
words, the most votes on any bill--will be the tripartisan bill because 
it has tripartisan support.
  Mr. REID. So the answer to my question is no?
  Mr. SANTORUM. Again, I suggest that you have created the atmosphere 
by which the point of order is available to some Members, and whether I 
agree or not doesn't matter. I think there will be Members on both 
sides of the aisle who will raise a point of order. Why? Because it is 
available. The Senator from Nevada knows full well if points of order 
are available, someone on this side--or the other side of the aisle, I 
might add--will raise a point of order. You have brought this bill to 
the floor by bypassing the Finance Committee. You have brought it with 
an instant point of order. That is the remarkable thing. You could have 
a prescription drug benefit bill that would cost $10, and if you 
brought that to the floor, it would have a budget point of order. Why? 
Because the budget says the bill had to come through the Finance 
Committee. So what we have done is set the bar where you now have to 
have every single Member of the Senate agree that this bill comes to 
the floor without objecting to it on a point of order.
  As the Senator from Nevada knows, you hardly get anybody to agree to 
anything around here, much less a multibillion-dollar expansion of 
health care benefits, without having someone opposed to the legislation 
and then raising a point of order. So what we have done, as I said 
before, is set the bar so high that you have ensured that nothing will 
happen.
  I will yield for a question.
  Mr. REID. I would say that the bill we are working on here was 
reported out of the HELP Committee by a 16-to-5 vote; 5 Republicans 
voted to bring it to the floor. That is why we were so stunned when we 
weren't able to go to the bill. I also say that it appears to me that 
this bill didn't need to go to the Finance Committee; it was under the 
jurisdiction of the HELP Committee. But even if a bill went through the 
Finance Committee, it would still need 60 votes and we could raise a 
point of order on it.
  Mr. SANTORUM. Mr. President, taking back my time I say not 
necessarily. It depends. If it were in the budget constraint and were 
not marked up in the committee, would it not be subject to a point of 
order?
  Mr. REID. Being marked up in committee makes no difference 
whatsoever.
  Mr. SANTORUM. That is not what last year's budget agreement says.
  I also make the other point that, with respect to this bill--and you 
said you were shocked at the objection. I hope you listened to the 
Senator from New Hampshire in laying out what were legitimate 
complaints about the way this bill was brought to the floor,

[[Page 13046]]

when certain assurances were given. As you know--and the Senator is a 
committee chairman and knows how markups work--certain assurances were 
made about issues being brought up in committee, and technical 
corrections or other corrections were ``agreed upon.'' And then when 
the bill came to the floor, those changes were not made.
  Mr. LOTT. Will the Senator yield?
  Mr. REID. Mr. Leader, he asked me a question. May I respond?
  Mr. LOTT. I will be happy to let the Senator respond, and then I want 
to ask a question.
  Mr. REID. I will be very quick in responding to the question. I say 
to my friend, in response to the question--even though you had the 
floor and you asked me a question--this, as far as I am concerned, is 
one of those excuses I have talked about. The bill was reported in a 
bipartisan fashion out of committee.
  My friend from New Hampshire, the junior Senator, said: You told me 
certain things. That is what the amendment process is all about. He 
said: It is technical in nature. This is just an excuse not to go to 
the bill. This is just an excuse not to go to the bill. We are wasting 
time that should be used on prescription drugs. That is what we have 
tried to establish today. We are wasting time when we should be dealing 
with the bill itself, not talking about technical amendments that 
should not be here. It is here, it is here on a bipartisan basis.
  Mr. SANTORUM. Reclaiming my time, the Senator knows fixing 
legislation on the floor is a lot harder than having something in the 
base bill. The fact is, the Senator believed certain assurances were 
made and those assurances were violated. He wanted an opportunity to 
pause to make that case. Subsequent to him making that case, he agreed 
to vitiate the vote. In fact, he agreed to proceed to the bill over an 
hour ago, and he agreed to vitiate the vote a couple hours ago.
  All I suggest is, if we were serious about moving to this 
legislation, having a discussion about prescription drugs, we could be 
doing that right now. We are in some degree doing that right now. We 
could be on an amendment. I hope the Senator from Nevada or somebody on 
his side puts down the Democratic proposal that we can have this 
debate, begin in earnest and have votes. I will be happy to yield to 
the leader.
  Mr. LOTT. Mr. President, if the Senator from Pennsylvania will yield, 
let me clarify. There are several issues in play. First of all, there 
was the point the Senator from Pennsylvania was just making that there 
was some understanding that Members thought they had some modification 
of the bill that was going to be made that did not happen. Maybe that 
was just a misunderstanding, but that contributed to this problem.
  The second issue, this is not just about this drug pricing bill. 
Everybody knows this is going to wind up being the vehicle for debate 
on prescription drugs. There is concern about going forward in this 
way; that this is going to be a process to which I have referred as 
mutually assured destruction because whatever is offered is going to 
have to get 60 votes because it did not come from the Finance Committee 
and/or because it exceeds what the budget allows. And that is the point 
I wish to clarify.
  If I am misinformed, I would like to know that at this point. But my 
understanding clearly is that because we do not have a budget 
resolution passed by the Senate, we do not have any budget numbers, 
that the number we are operating on that is allowed for prescription 
drugs is $300 billion. That is what was identified last year, and that 
still is what applies.
  If you exceed that amount, you have to have 60 votes to overcome a 
point of order. Secondly, if it does not come from the Finance 
Committee, that in itself would require 60 votes to overcome a point of 
order.
  There are two reasons we will have to have 60 votes to pass any of 
the bills that may be offered in the prescription drug area.
  If that is not correct, then I stand corrected. If we could get a 
bill out of the committee that was under that amount, then there would 
not be a problem. At least one of the approaches, or maybe a couple 
approaches, that will be offered--the one by Senators Hagel, Ensign, 
and Gramm that would cost, I understand, somewhere between $150 billion 
to $170 billion--would not require the votes to overcome the point of 
order, but it would because it did not come through the Finance 
Committee.
  There is a simple solution to this: The Finance Committee should meet 
and vote. We have met for hours trying to figure out the right way to 
do this. It is difficult, it is complicated, and it is important. We 
met 4 hours, and I was there a couple hours last week. Yet we have not 
had a markup. Let's go to a markup, have debate, amendments, and see if 
the Finance Committee can report a bill. That is what I urge we do. 
Then we can have a bill that came out of the committee, that could have 
tripartisan support, and it would not be subject to a 60-vote point of 
order. We could pass it with 51 votes and get real help to people who 
need it--the elderly, sick, poor people--and we can do it this week.
  Mr. SANTORUM. Was there not a markup scheduled for the Finance 
Committee this week?
  Mr. LOTT. There was a markup. We marked up two minor bills last week, 
and there was a markup scheduled at 10 o'clock this morning. It was 
delayed to 2 o'clock and then cancelled. Why? Because Senators Snowe, 
Grassley, and others in the tripartisan effort served notice that they 
were going to offer a prescription drug package to a so-called minor 
bill. As a result of that, that markup was canceled.
  It really bothers me. It looks to me that we are headed for a 
situation where, when the smoke clears next week, no package will be 
left standing, and we will not have passed a bill with 60 votes and the 
people once again will not get the help they need. We seem to be 
striving to find a way not to do this. I do not understand it.
  I do not question the merits of the different bills. We can argue 
about them and we can debate them, but if the end result is nothing, is 
that good? As far as the underlying bill, if we knew debate was going 
to be on the drug-pricing issue, we could have started earlier, and we 
could probably have finished it this week. But there are two distinct 
issues that are riding on each other. It is a real problem.
  Once the prescription drug bills perhaps fail, I guess we will come 
back to the base bill, and it will probably pass and I assume it will 
be a bipartisan vote: Some for it; some against it. I want to clarify, 
it is my understanding that clearly it takes 60 votes because of the 
amount involved and because the Finance Committee will not have acted.
  Mr. SANTORUM. The Republican leader is correct. As I said earlier, if 
a drug benefit bill were brought forward that cost $10, it would be 
subject to a budget point of order because of this procedure.
  People are asking: Why is the 60-vote procedure such a problem? The 
Senator from Nevada asked would I object to an up-or-down vote on one 
of them? I can certainly agree to that. The problem is the 99 other 
Senators; only one of them needs to object to an up-or-down vote and 
make a point of order against the underlying bill because it is not 
reported out of the Finance Committee, and we have a problem. We have 
to get 60 votes.
  The interesting question is why are we in this situation? Obviously, 
because the majority leader has decided to bring a bill straight to the 
floor and not through committee. Why are we in this situation even 
stepping back from what happened yesterday? Because we do not have a 
budget. We have no budget. For the first time since 1974, we have no 
budget in the Senate. Now we are starting to see the consequences of 
not having a budget.
  The other point is we do not have any appropriations bills passed. I 
am not the one objecting to the MILCON appropriations bill, and I hope 
we can work that out and I would be very supportive of passing it on a 
very short timeframe. The fact is, we are way behind on appropriations, 
and if I look at the schedule, we are talking about

[[Page 13047]]

health care this week, next week, and talking about homeland security 
the week we leave. I do not see any time in here to do 13 
appropriations bills that are necessary to run the Government of the 
United States.
  We have no budget, we have no appropriations bills, and as a result 
of having no budget, we have a, to be very candid, screwed-up system by 
which we are dealing with a Medicare prescription drug bill, which to 
my constituents--and I represent per capita the second oldest 
population in the country--is perhaps one of the most important bills, 
maybe the most important bill, we are going to deal with in Washington, 
DC, for the people of Pennsylvania.
  I always say we are second to Florida per capita in the number of 
seniors, but my comment is, my seniors care more about Medicare and 
prescription drugs than the ones in Florida because all my rich seniors 
move to Florida, and what is left in Pennsylvania are the folks who 
really need the coverage and cannot afford it. So this is a very 
important bill for the folks in Pennsylvania.
  This is something we want to accomplish. This is not something I want 
to be held up by some procedural trick.
  I will say without reservation that if we had a clean process and we 
had a bill that came out of the Finance Committee that was not subject 
to a point of order, we could begin the amending process and have the 
Senate work its will. Would I be happy with the product? I would 
probably not be overjoyed with it. I do not even know if I would vote 
for it. But we would move the process forward where we get a bill to 
conference that is conferenceable with the House, and we have the 
potential of getting a prescription drug benefit for millions and 
millions of seniors across America who are relying on us to do it. But 
instead of going through the process which assures us of getting a 
bill, we have developed a process which assures us of getting no bill.
  So don't anybody next Friday say, oh, golly, we did not make it; oh, 
golly, we did not pass a bill and think, gee, we really gave it a good 
chance.
  This process was scripted for failure. This process was created for a 
partisan issue in November and nothing more. This is not a serious 
debate about Medicare prescription drugs. When we are serious about 
doing Medicare prescription drugs, we will do it the way it was 
intended to be done and contemplated by the budget of last year, which 
is what is done with every other major entitlement bill we have ever 
dealt with in the Senate. What is that? Go through the committee of 
jurisdiction. The committee works its will. A bill is brought that has 
had a lot of the kinks worked out, has had bipartisan compromise by 
experts who study and work on that kind of legislation--that is why 
they are on the committee--and the bill is brought to the floor to work 
out the final, in many cases major, issues. Then you get the bill done, 
you go to conference, and you move on.
  That is not what is happening. Why? That is a good question. Why? Do 
we not trust the chairman of the Finance Committee to mark up a bill? 
Do we not trust the committee of jurisdiction to take up this 
legislation on which there is intense interest in the committee? There 
are several bills germinating out of members of that committee on both 
sides of the aisle. Why do we not trust this committee to do its work 
on the most important issue that that committee will deal with this 
year? Why have we said we do not trust the Finance Committee, we do not 
trust the chairman, we are going to go over their head, we are going to 
bring a partisan bill, which to my knowledge no one on this side of the 
aisle has seen? And I suspect there are a lot of folks on that side of 
the aisle who have not seen it.
  The bill has not been scored. We have no idea how much it costs. The 
Senator from Nevada said he hoped to be debating this bill tomorrow. I 
hope to be debating the bill tomorrow, too, because I would like to see 
it.
  Think about this: The largest expansion of entitlement programs in 
the history of the country, and we are going to bring the bill to the 
floor, having not gone through committee, having not seen it, and ask 
for a vote on it.
  The rumor mill among the press is this bill costs $800 billion. Now, 
that may be high. I do not know. That is the number I heard outside. 
That is $800 billion, not over 10 years, because the bill sunsets, but 
only 6 years. So it is a trillion-dollar expansion of government. That 
is even a big number for Washington, a trillion-dollar expansion of 
government, and no one has seen the bill. It has not gone through 
committee. There has not even been a hearing on the bill. A trillion-
dollar expansion of government, and there has not been a hearing on the 
bill, much less a markup.
  Now what they are telling the American public is: We are really 
serious, aren't we? We are serious about passing a drug bill, aren't 
we? We have not had a hearing on it, we do not know how much it costs, 
we haven't gone through committee, haven't marked it up, we have not 
brought it to the floor, but trust me, we are serious about passing a 
bill. This is real, this is legit, we really want to do this, we really 
want to make this happen.
  Remember, we have not drafted the bill, do not know how much it 
costs, have not had a hearing, have not had a markup, have not even 
brought the bill up to the floor, but we are serious, and it is, by the 
way, a trillion dollars. We really want to make this happen, and we are 
going to get it done in a couple of days, trust us, and we will work it 
out. That is the procedure.
  Then we have people saying: How dare you raise a point of order 
against this bill that has not been finished, that costs a trillion 
dollars, has not had a hearing, has not been marked up, has not come to 
the floor. How dare you raise a point of order against this trillion-
dollar expansion of government. How can you do that? You must not care 
about seniors. That is going to be the issue in November: You do not 
care about seniors because you did not allow us to pass a bill that no 
one had seen, costing potentially a trillion dollars, that no hearing 
had been held on, that no markup had been done on, and that we had not 
had the opportunity to even see and debate on the floor, with people 
wondering why we raised a point of order.
  Mr. REID. Will the Senator yield for a question?
  Mr. SANTORUM. I would be happy to yield for a question.
  Mr. REID. Is the Senator aware that this legislation about which the 
Senator from Pennsylvania speaks has been written and authored by these 
two radical Democrats by the name of Bob Graham from Florida and Zell 
Miller of Georgia, who both have credentials, I would suspect, that are 
as moderate as any in the Senate? Is the Senator aware of these two men 
who have sponsored this legislation, who have written it?
  Mr. SANTORUM. I understand they have been involved in the writing of 
the legislation.
  Mr. REID. Is the Senator also aware that this legislation about which 
the Senator speaks has been endorsed by many organizations and groups 
in America, including the AARP?
  Mr. SANTORUM. Which I find remarkable to believe, and the answer is, 
I do know that some organizations support it, but I find it remarkable 
to believe that any legitimate organization would endorse a bill they 
have not seen and have no idea how much it costs. The answer to your 
question is, yes, I am aware that certain organizations have endorsed 
it. I question the responsible nature of those organizations that would 
endorse a bill they have not seen, have no idea what the impact is on 
their members, and have no idea what the impact is as far as the cost 
to their members and the cost to the taxpayers, because we do not know 
that yet.
  Mr. REID. I have two very brief questions I would ask the Senator to 
answer.
  Mr. SANTORUM. Sure.
  Mr. REID. The Senator is not suggesting in any way that AARP is not a 
legitimate organization, is he?
  Mr. SANTORUM. I did not say legitimate. I said responsible. There is 
a difference. They are certainly legitimate. I question how responsible 
they are.
  Mr. REID. In the Senator's first statement, he did say legitimate.

[[Page 13048]]


  Mr. SANTORUM. If I did, let me correct that. AARP is certainly a 
legitimate organization. I would question how responsibly they are 
acting if they are endorsing legislation they have not seen and do not 
know how much it costs.
  Mr. REID. The Senator has indicated we should be working on 
appropriations bills, and I agree with the Senator. But is the Senator 
aware that for--I have lost track of the days, but for several days I 
have offered at least four, maybe more, unanimous consent requests that 
we move to military construction with a time of 65 minutes and I have 
received an objection on that side of the aisle?
  Mr. SANTORUM. I would say to the Senator from Nevada, he did not 
receive an objection from me. All I can say is we have a Member or two 
on this side of the aisle who are concerned about the ability to pay 
for fires in their States, and I think the Senator knows that. We all 
have concerns about appropriations and disasters in our State. I 
certainly respect the Senators objecting to that. I hope we can work 
that out because I agree with the Senator from Nevada that we should be 
dealing with appropriations bills.
  MILCON is one that is usually not very controversial, there usually 
are not a lot of amendments to it, and we should be able to pass it in 
a very short period of time. We are certainly working on this side of 
the aisle very diligently to try to take care of the objections so we 
can get to that issue.
  I appreciate the Senator moving forward on that, and I hope the 
Senator from Nevada will then, after we get MILCON done, move to the 
Defense appropriations bill because I think it is vitally important, as 
we are fighting this war and we are trying to protect the homeland and 
we are doing things that are on the cutting edge of transforming our 
military, that we get that legislation passed in the Senate. When we 
get MILCON and DOD passed, the soldiers, sailors, airmen, and marines 
will know the money is there and the program dollars can be spent in a 
much more efficient way.
  I am a member the Armed Services Committee, and that is always a 
concern, that there will be a delay in the release of money in the 
appropriations process. I think that would be a very important thing we 
could do between now and the August recess, if possible. I will 
certainly work with my colleagues on this side of the aisle to get them 
to have a very short list of amendments and see if we can get a DOD 
bill passed in short order.
  Mr. REID. If I could respond to my friend without his losing the 
floor, as a member of the Appropriations Committee, we reported out 
this morning, or this afternoon--around noontime--the largest 
appropriations bill in the history of the country. That is why--and the 
Senator has taken my script--I have said basically the same thing on 
military construction. We have to move forward on that because we have 
construction projects for our men and women in the military all over 
the world. Most of them, of course, are in America, but we have 
military construction projects around the world that are waiting, and 
we need to get to that.
  I appreciate the Senator saying he would join with us, but the 
problem is we have had trouble moving all legislation, not the least of 
which is the military construction appropriations bill.
  I appreciate the courtesy of the Senator allowing me to ask 
questions.
  Mr. SANTORUM. The Senator from Nevada is always courteous to Members 
on our side when we come to the floor and we appreciate that gentility 
in the way he deals with questions and answers and appreciate his 
questions. I know we can work together in a bipartisan way to 
manufacture as many appropriations bills as possible between now and 
the August break. I know the Appropriations Committee has begun to 
churn out these bills in marathon sessions. That is welcome news.
  Hopefully, we can get to what I believe is the most important. It is 
a big bill and it is complex. It is several hundred billion dollars. It 
is still smaller than this bill and a heck of a lot less complex, a 
bill that potentially could be presented here by the majority to expand 
prescription drugs.
  Again, even though I object to the way this procedure is being done, 
I am very much for having this debate on the Senate floor and trying to 
get a prescription drug bill done that meets the needs of our seniors 
all across the country. I don't like the way it is structured. I don't 
believe it has been structured in a way that will lead us to a result 
that can be satisfactory to any senior. It is certainly a debate we 
should have. I just wish we had it under circumstances with a 
possibility of success. I don't think we are heading in that direction 
at this time.
  A final point is on the underlying legislation. As I said before, I 
have only had a chance to look at it over the last 24 hours since I 
have been back in town. I have some concerns about this underlying 
legislation. This is more of a vehicle than a substantive issue. We 
have to understand, when it comes to the pharmaceutical companies, they 
are the great whipping boy in the Senate and certainly in the House and 
many places across the country. The fact is, about 50 percent of the 
new drugs that come on the market come from innovations in the United 
States of America. People are alive today who are listening to my voice 
because of pharmaceutical companies making billions of dollars in 
investments each year to create new drugs, to move the envelope 
forward, to improve the quality of and to lengthen people's lives.
  I understand they get beat up on because they try to use their 
patents and they charge more money here than in other countries and all 
the other things said about them, but the fact is, if bills such as 
this pass--and I am concerned about this particularly, some of the 
litigation provisions--we are going to erode the incentives for 
pharmaceutical companies to invest in cures.
  It is popular, very popular, to go around and promise seniors you are 
going to get them cheap drugs; that these generics are the answer. 
These filthy horrible drug companies, the pharmaceutical companies, the 
name brand pharmaceutical companies are horrible people who are raping 
and pillaging you, and if we just give all their patents to the generic 
folks as quickly as possible and give the generics an opportunity to 
get in there quicker, your drug prices will be lower. That is an 
argument that appeals very much to this generation of seniors and this 
generation of pharmaceutical users at the expense of future cures for 
them and others.
  Some may say that is a good tradeoff. The politics is smart, I guess, 
because people would rather have the money in their pocket than the 
perspective of maybe something happening that may or may not affect 
them in the future. I understand the game. I understand the politics. 
The politics are great in being able to promise somebody a 50-percent 
reduction in their drugs, or a 30-percent reduction in their drugs. 
That is great. People see it, feel it, and hear it. But people also 
need to realize that when you do that, you limit the innovation that 
occurs; you limit those lifesavings drugs, the enhancing of the 
quality-of-life drugs that come out of this Nation's terrific 
pharmaceutical industry.
  Sure, I will join others on this side with some amendments. I know 
Senator Hatch and Senator Gregg have concerns about this underlying 
legislation, have concerns about some of the issues, such as the 
reimportation of drugs.
  I have very serious concerns about the safety of the reimportation of 
drugs. In Canada, they are cheap and they can send them back here and 
they are cheap. They sell them in Canada because they say this is how 
much you are going to charge; if you don't want this price, you cannot 
sell your drug in Canada. By the way, if you really want the drug, we 
will make it and sell it here ourselves. So you have no market and we 
will sell your drug anywhere.
  You say: I cannot believe that happens. That happens.
  Here is a pharmaceutical company that says: I charge $2 for the drugs 
in America; it costs me a quarter to make them. I charge $2 for the 
drug in America. It costs me a quarter to make it--that is, the process 
to make it. But the rest is to make up for the many cases,

[[Page 13049]]

hundreds of millions, invested to get this formula to where it is. I 
have to make it up somehow so I have to charge more.
  Canada says: I will only pay you a dollar; I will not pay you $2. I 
will only pay you $1 or 50 cents. The drug company has to make a 
decision: Do I sell it for less there and get the wrath of the American 
politicians who say, look how cheap this drug is, or do I sell it for 
less there, still cover my costs, and make a small profit--not as much, 
but I make a small profit--or do I not sell my drug there, have a 
Canadian steal my patent, make the drug and sell it there anyway?
  If you are a pharmaceutical company, that is a decision you have to 
make. Some say: No, I don't want to sell the drug. I will not do it. 
Others say a little profit is better than none. And some suggest this 
is perhaps a unique drug, they feel a social obligation to make it 
available in countries because this is a drug that maybe doesn't have 
anything similar to it. So they sell the drug even at a very small 
profit because they feel a social responsibility to do so because it 
will save lives.
  For this, they have Senators of the Senate holding up drugs and 
saying: Look at these rotten drug companies. Look at these rotten drug 
companies. Look what they are doing.
  Understand the story because you are not being told the full story. 
You are not being told what really happens. Yes, they are cheaper, but 
now you understand why they are cheaper. They can say no. Fine. In some 
cases, saying no means people will die. Most pharmaceutical companies, 
contrary to what you hear, are not in the business of wanting people to 
die so they sell their drugs. I suggest we understand the whole story 
before we get into how bad these guys are for selling drugs cheaper in 
other places.
  The bottom line is the American public, as a result of the way 
foreign governments operate, subsidize research in the world. Is it the 
right thing to do? We should have a good policy discussion on that. 
There might be legitimate competing arguments whether we should 
subsidize the research by paying more for research. However, if we do 
not, the research will not get done and people will die because that 
new drug that could have been invented had the investment been made 
will not be developed or it will be much later.
  Those are the chances. I know that is taking the dollar you could get 
now for cheaper drugs for the promise of something better later. One 
thing drug manufacturers can point to is the promises have been made 
good, if you look at the quality of the pharmaceuticals that we have on 
the market today and for people whose lives are being saved and the 
quality of life that is being improved.
  Understand what we are doing. This is not as simple as some would let 
you believe. Understand what we are doing. We are going after the big 
bad pharmaceutical companies that are responsible for many people being 
alive today.

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