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PMA SEARCH FOR ENGMAN's SUCCESSOR COULD GET TO PRELIMINARY INTERVIEW STAGE BY NEXT MONTH: ASSN. ALREADY HAS NAMES OF ABOUT FOUR DOZEN APPLICANTS/CANDIDATES

Executive Summary

The Pharmaceutical Mfrs. Assn. (PMA) has an initial list of about four-dozen candidates for the position of president to succeed interim assn. chief Joseph Stetler at the next annual meeting, beginning on April 14, 1985. The assn. and the Executive Cmte., which is spearheading the search for a new president, has developed the initial list from applications and recommendations for the position. The assn. has indicated that it does not want to use an outside head-hunting firm until it has had a chance to review the candidates suggested through its own informal network. PMA has not yet begun contacting all the potential applicants for the top staff position. The Executive Cmte. has met on the subject at least once to discuss the general job description for the position. Another Executive Cmte. meeting is scheduled at the beginning of next month. The assn. may begin setting up preliminary interviews in conjunction with that meeting. The preferred background for the next president continues to emphasize knowledge of the pharmaceutical industry. Washington and Capitol Hill know-how is always an important asset for a top assn. executive; but this time around, it is being stressed less by PMA now that the difficult patent restoration struggle in Congress is over. Schweiker, Hayes, And Novitch Have Been Mentioned As Possible Candidates Interim PMA President Stetler's recent series of re-inaugural addresses appear to define the top issues for the next full-time assn. chief. Stetler has identified three major issues for the assn. in 1985: (1) initiating a discussion of fundamental changes in the FDA new drug review process; (2) escalating PMA's position in internatl. policy debates, especially in relation to a World Health Organization (WHO) marketing code; and (3) renewing the effort to get a change in the U.S. drug export restrictions. These issues help to specify some of the strengths that could help the next PMA president.For example, the assn. chief should be familiar with the internatl. situation in health care marketing or have held a position that will make acceptance by overseas officials easier. Experience in top policy positions such as the FDA commissioner, HHS Asst. Secty. for Health and HSS Secty. would carry weight on the internatl. scene. HHS Asst. Secty. for Health Edward Brandt, for instance, combines both experience at a job with internatl. stature and a specific background in the marketing code debate. His name was referred to PMA, but he announced his resignation from govt. on Oct. 12 to become Chanceller of the University of Maryland (Baltimore). Among other previous HHS assistant secretaries who have kept up contacts with the drug industry are Charles Edwards, head of the Scripps Clinic, and Upjohn Vice-Chairman Ted Cooper. Both are clearly qualified for the PMA position, but have drawbacks. Some drug company execs shy away from considering former FDA commissioners for the assn. top spot, and Edwards served in that position before moving up within HHS.Cooper has recently been promoted at Upjohn and his close affiliation with one company could be a problem. If the former FDA job is not viewed as a liability for fear of the perception of conflict of interest, then Art Hayes and Mark Novitch might be actively sought out by the assn. Both names have been referred to PMA in its initial round-up of candidate possibilities. Former HHS Secty. Richard Schweiker's name has also been mentioned for the PMA position. In both the Senate and at HHS, Schweiker took special interest in the issue of the NDA approval process. Schweiker was a co-sponsor of drug reform legislation in 1979. Schweiker left govt. service in January of 1983 to become president of the American Council of Life Insurance. That job gives him experience in dealing with an assn. board of directors -- another of the key skills for any successful assn. president. Another politically-skilled potential candidate with Washington policy background is former NIH Director Donald Fredrickson. He was one of the few health holdovers in the change from the Carter to Reagan administrations, and he has a reputation of being acceptable to both Democrats and Republicans. As a representative of the biomedical research community, Fredrickson could exemplify a side of the drug industry which draws the most lay public respect. Fredrickson has familiarity with the industry but has not had to deal with it on day-to-day regulatory decisions. He could also be an effective spokesman for an effort to change the way FDA uses outside experts in the drug review process. Fredrickson has been out of govt. for just over three years. He is currently the president of the Howard Hughes Medical Institute. Among lawyers whose names have been mentioned for the PMA job is former FDA General Counsel Peter Hutt. His experience in the patent restoration debate as an advisor to the PMA board is probably both a plus and a minus for the assn. presidency at this time. A tactical challenge for whoever takes over at PMA will be how to deal with the increasingly large and independent Washington offices of the major drug firms. In two major legislative efforts during the past two years (patents and changes to the Sec. 936 tax breaks), the drug industry has appeared on Capitol Hill as a sharply divided force. As the industry gets larger and more diverse, it may be more and more difficult to arrive at single unified positions for some pieces of legislation. The next PMA president will have to determine carefully what the assn.'s role should be in legislative efforts -- whether the assn. attempts to coalesce a single unified position or whether it acts in a supporting role to a number of various individual lobbying efforts. For instance, if Congress returns to the 936 tax policy in 1986, should PMA try to develop consensus alternative tax proposals or should it be limited to providing information on the effects of drug investments on Puerto Rico? Engman tried to hold the assn. together as a unified force on the patent bill on the assumption that the only way PMA could get input into Waxman's legislative effort was to reach a deal with Waxman, the generic industry, and Hatch and stick to it, unless all parties agreed to a change. At the end of the legislative process on patent restoration, PMA as an assn. was no longer effectively involved in the progress of the bill, and the dissident coalition handled the final negotiations. The patent bill may have represented a one-time situation, but it may also indicate that PMA's future role in key, controversial legislation will be to support rather than to define industry policy.

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