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Mr. STETLER. Before I begin the statement, I would like to ask this question. You have raised two important points. Do you want me to comment on those now, or did you say you would prefer to wait until later?

Senator NELSON. Well, I am happy to have you comment on it right now,

if Mr. STETLER. I think it might be better. STATEMENT OF C. JOSEPH STETLER, PRESIDENT, PHARMACEUTI

CAL MANUFACTURERS ASSOCIATION, WASHINGTON, D.C.; ACCOM-
PANIED BY LLOYD N. CUTLER, SPECIAL LEGAL COUNSEL; DR. A. E.
SLESSER, ASSOCIATE DIRECTOR OF QUALITY CONTROL, SMITH,
KLEIN & FRENCH LABORATORIES; AND DR. ROBERT QUINNELL,
DIRECTOR, MEDICAL RELATIONS, PHARMACEUTICAL MANUFAC-
TURERS ASSOCIATION

Mr. STETLER. On my comments with respect to the hearings, I have never felt nor have I ever said that this is not an appropriate activity of Congress or this committee, nor that such hearings may not be necessary.

Senator NELSON. You understand that I did not assert that did say that. I said that various groups have made several criticisms, and one of them is that this is not an appropriate subject matter for congressional consideration. I am not aware that you have ever said that.

Mr. STETLER. As a matter of fact, I think it is a completely appropriate subject for inquiry. And my comments as to who have or who have not been heard have not related to the members of the pharmaceutical industry primarily, although I did comment that we would prefer that the PMA have an opportunity to testify before individual companies. And as you know, we discussed that before. But five companies were put on in advance.

If other companies should be here, I think they will be glad to appear. But I think the predominant view in the industry is that the subjects that have come up in these hearings, that affect the industry, can be appropriately discussed by me or by the men that I have with me from our companies and our sections.

Now, what I have said and this is in the area of criticismSenator NELSON. Let me go back to that point for a minute. As you are aware, from the very beginning, 5 days before the hearings ever started, you were in my office with your counsel to ask when į you could be heard. I told you to let me know when you wanted to be

heard. And I also stated very early in the hearings that I would be happy to hear from the whole industry, all its individual members, as well as the PMA.

I trust you don't think it is a matter of fairness, so far as the committee is concerned, whether we invite and schedule individual member companies to appear before or after the association, do you?

1 Mr. STETLER. We thought it would be preferable—it would add something to the hearing-if we could give a general presentation. As you know

Senator NELSON. But that is not a matter of fairness, is it?

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Mr. STETLER. Only that three of the five companies that were involved were before the committee because of a particular price situation that was of interest to the company and to the committee. And that seemed to us like rather specific items which might better follow a general presentation by the industry. But I must say that is not my main point.

The main point is this. The major items that have come up in the hearings have dealt with medical and scientific issues—primarily the subject of generic and therapeutic equivalency—the major issues, it seems to us, have dealt with issues of equivalency-generic and therapeutic—some on: the compendium, and some on the detailing of doctors. But certainly doctors and scientists and some of these scientific issues have been in the forefront of the hearings.

Now, we think that to the extent that medicine or pharmacologists has been heard, they have expressed a minority view. We think there is another view, and in our opinion it is the predominant view. And that there are some people that should be called by the committee or if they have asked to testify, that they should be allowed to testify. And there have been quite a number that have done just that.

I think really it is with respect to the scheduling of some of those nonindustry witnesses that there has been, in our opinion, a problem. It is in that area that I have said I think the other side of the scientific case before the committee should be more fully exposed.

I still have that feeling.

Senator NELSON. Well, I am sure that if you were conducting the hearings, you would conduct them differently. But a serious question that seems to me to be raised is that in a number of speeches you have made, you stated directly or implied that the hearings have been loaded against the industry, that you have not had a chance to appear, or that you do not know when you can appear. And this was said very shortly after the hearings started, even though I had gone into that in some detail with you in private.

Here is the sort of thing I am referring to.

In Chicago, on September 23, a little more than a month ago, in a speech to the annual convention of the American Medical Writers Association, you stated, “The fact is the pattern of the hearings was set on the first day by the testimony I have just described, and it has not changed in 4 months as one handpicked witness has followed the other to the stand. I use 'handpicked in the most liberal, deliberate, and factual way."

That was said with the intent of convincing those people that these hearings have been unfair, biased, and loaded against the industryisn't it?

Mr. STETLER. Not against the industry. They have not covered the scientific issues in a way to give the other side and there is another side—an opportunity to present their views.

Now, I mean by the other side groups that have asked to testify, like the American Academy of General Practice, the two national organizations of interns, the American Medical Association, the Association of Abdominal Surgeons-groups of this type that speak for large numbers of doctors and scientists. I think they can give a more representative view than an individual physician who speaks for himself.

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Senator Nelson. How do you know all these organizations have asked to appear?

Mr. STETLER. They have told me they have asked to appear.

Senator NELSON. As you are well aware, we cannot hear everybody on the same day. I simply respond to that by saying that there is nobody, no group that is better prepared, it seems to me, to answer any single question about generic equivalency, quality control, or pricing than your individual members.

At the beginning of the hearings, I publicly extended an invitation to every single PMA member to appear before this subcommittee.

I will document this in the record later-I begged them to come during the first week of the hearings.

So you are not satisfied with the fact that I did not invite as witnesses some people that you would like to have. But I do not know how you can prefer any witness in the world over your own members, and I do not know of any witnesses that are better prepared to talk about generic equivalency and all the aspects of the problems that we have discussed than your own members. I have asked them to come, and they have not come. So how can you go to Chicago and say the witnesses who have been picked are loaded against you, when at any time I would have taken any one of your members and put them on, but I could not get them.

Mr. STETLER. Senator, in your remarks on the 15th, which were most appropriate, and frankly is what guided mewhen these hearings started—you not only invited industry witnesses, but you very properly invited anybody with an interest in this controversy to come and be heard.

Now, I have not said that industry has been disadvantaged. What I have said is that these other groups should be heard.

Now, as far as the Academy of General Practice is concerned, they have been advised that they will not have an opportunity to be heard, that there is not enough time for them. And I think, frankly, that when they represent 30,000 active general practitioners, they have a right to be heard.

Senator NELSON. Well, the Academy of General Practice will be heard. If the staff members sent out a letter saying they won't, the staff is in error. I have said repeatedly that every valid viewpoint will be heard. I cannot hear everybody.

Yesterday, for the first time, we had testimony from a representative of the American Pharmaceutical Association. I suppose they are entitled to exactly the same complaint as you have made—they got on the same week. The Academy of General Practitioners could have the same complaint. We cannot take them all at once. But my point is that the one advantage I gave to the industry, that

I I did not give, because I could not, to any other interested group was to tell you in my office, and tell them here from the chairman's chair several times that I will take any single industry witness that is willing to come because this involves them more directly, more immediately, and in more ways

than

any other group in America. So in order to be fair, I said "Come on in any time you want to." They have all the expertise in the world. They manufacture the drugs.

They know what generic equivalency is. No representative of the - Academy of Physicians has more knowledge about this than the best experts in the industry. No private practicing physician can match that knowledge. No single pharmacologist could match knowledge that these big distinguished companies have themselves.

So I repeatedly said "Come on in." Now, you charge that the hearings have heard, as you put it, only "handpicked witnesses.” Well, I was trying to handpick yours. I invited them all. And they would not volunteer.

My point is that you should have said to that audience in Chicago in order to be fair yourself, “I don't like the order in which the witnesses have appeared, but my own representatives, my own 136 members, defaulted and did not step forward and volunteer to appear.” Then I would not have any criticism.

Bt the fault lies exactly and precisely right on the shoulders of the member companies that manufacture drugs, because I begged them to come in. I cannot think of anybody better prepared to discuss this question. If they do not come, I am not to be blamed for that, am I?

Mr. STETLER. Senator, we are obviously in disagreement on this point.

Senator NELSON. Am I or am I not to be blamed for your members failing to come in and present their case?

Mr. STETLER. You are not to be blamed for that, and you have not been blamed for that. I get back to my other point.

It is the other element that I think should be heard in these hearings.

A good deal of time was spent, for instance, last Thursday, by Dr. Goddard on the subject of a drug compendium. And we came in for some kicking around on that occasion. Now, a drug compendium is allegedly for physicians. I think physicians should have a chance to tell you what they think they want or need with respect to a drug compendium. Let us hear from doctors on that one.

Senator NELSON. Where would you start? I suppose everybody could have different ideas as to where we might start to have testimony on the drug compendium. Do you know of any better place to start than with the head of the Food and Drug Administration?

Mr. STETLER. I would start with the American Medical Association or the Academy of General Practice because

Senator NELSON. I am glad you raised that question. We invited Dr. Thomas Hayes of the American Medical Association to come before the committee the AMA refused to let him come.

Mr. STETLER. Senator, the American Medical Association has written three times to the committee to be heard. Now, I think

Senator NELSON. Just a minute. We invited Dr. Thomas Hayes. He is head of the drug council; is that not correct?

Mr. STETLER. Correct. Senator NELSON. We invited him to come, and the president of the AMA refused to let him come. Do you know that?

Mr. STETLER. I think the AMĂ should be permitted to select their witnesses, if they are going to appear before this committee. And they did not want Dr. Hayes to be the witness.

Senator NELSON. He is head of the drug council.

Mr. STETLER. They have a lot of people in higher positions in the AMA than Dr. Hayes.

Senator NELSON. Can you speak for the president? Would the president of the AMA come?

Mr. STETLER. I do not know. I think he probably asked to come.

Senator NELSON. We would like to have the president of the AMA. We would like to have the head of the drug council. And if they have some suggestions we will take those, too. But I don't think the AMA ought to select exclusively who would come. The fact is, as you know, that Dr. Annis, past president of

the AMA, wrote to Senator Smathers and said he would like to come. He was not on the board of the AMA at that time. Mr. STETLER. He is on the board now.

Senator NELSON. I told Senator Smathers that we will put on individual doctors when we can arrange the time. Then, when Dr. Annis became a member of the board, the AMA wrote and said, “We want Dr. Annis to speak for us." Well, I would like to hear the head of the drug council, who was willing to come, as I understand it, but who was not permitted to come by the president. I would like to have the AMA president testify. And we would take Dr. Annis, too. Is there anything unfair about that?

Mr. STETLER. I think they should be heard and I think that is a good idea.

Senator Nelson. Well, we have already invited Dr. Hayes, and they have turned that down.

Mr. STETLER. I think they are waiting now for a reply to their request to be heard.

Senator NELSON. Well, I make an open invitation to the president of the AMA, and again to Dr. Hayes, head of the drug council, to come. If they are willing to come, we will also take Dr. Annis, who was not on the board at the time that he made a personal request to come. Subsequently he went on the board, and then the AMA said, “He will speak for us.” Well, that is fine, but I am not prepared to permit him

to be the exclusive spokesman for the AMA, and I do not think I have : to be. >

Mr. STETLER. Well, I cannot comment on that, obviously.

Senator NELSON. Well, just so the public knows I invited Dr. Hayes, director of the drug council for the AMA, and he was willing to appear, but the AMA would not let him come. I think that ought to be a part of the record.

We made a public statement inviting the president of the AMA to come, too. We have not heard from that invitation.

Mr. STETLER. Senator, actually, I think you have a fairly recent letter from the AMA reiterating their desire to have a date set for e them to appear.

Senator NELSON. Who is "them”?
Mr. STETLER. Whoever they select as their witness.
Senator NELSON. The letter said they want Dr. Annis.

Mr. STETLER. He is a perfectly legitimate witness. He is a member of their board, a past president of the AMA.

Senator NELSON. Fine. I am glad to have past presidents. I would like the current president.

Mr. STETLER. I am sure he will be available and willing to testify.

Senator NELSON. All right. He has not responded to our public invitation. Dr. Thomas Hayes has not been permitted to come. I want to be fair about this.

I want the AMA to be represented by their top, people, their drug council. I will repeat the invitation publicly, as I have in the past, to

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