Drug Companies Against Prop 61 Repeat Rent-A-Vet Strategy

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You have to have the deepest respect for the women and men who serve our nation and put their lives on the line for Americans. That’s why it’s particularly galling when a Sacramento lobbyist profits by making money from drug companies under their name.

The latest episode is in the fight over Prop 61, which reins in drug company price gouging of the state of California, by requiring that the state pay no more than the Veterans' Administration prices. The drug companies have poured $90 million in against Prop 61 to maintain high prices.  They know the public won’t budge from its strong support for Prop 61 if it sees Mylan, the maker of the EpiPen, and other drug companies as the opponents.

Enter the lobbyist for some national Veterans’ organizations in Sacramento, Pete Conaty, who is on the drug makers’ payroll to the tune of $10,000 per month, and has lent his clients’ names to front for the drug makers against Prop 61, which, by the way, have been no friend of the Vets, Mylan moms, or anyone else.   

The federal government is guaranteed the lowest priced drugs for the Veteran’s Administration, under federal law, so it’s hardly endangered by Prop 61’s price gouging protections for California. But that’s the bogus case Conaty and crew are making to try to bring Prop 61 down on behalf of Mylan, Pfizer, Schering et al.

No on 61 campaign finance reports, filed with the California Secretary of State’s office, show it began paying the lobbying firm of Pete Conaty & Associates in December of 2015. Conaty, a well-known Sacramento lobbyist, who wears his army cap around the Capitol, represents the California arms of the American GI Forum, the American Legion, AmVets, County Veterans Service Officers, Veterans of Foreign Wars, and the Vietnam Veterans of America, among others.

“Three months and $15,000 later, all of Conaty’s clients miraculously came out publicly in opposition to the California Drug Price Relief Act,” the Yes on Prop 61 campaign, of which Consumer Watchdog Campaign is a part, reports. “ The very next month, Big Pharma doubled what it was paying Conaty’s firm, from $5,000 per month to $10,000 per month. As of June 2016, the lobbyist who represents most of California’s major veterans groups had collected more than $35,000 from the drug company-financed campaign. In addition, to back up their investment in Conaty, Big Pharma’s campaign has paid more than $8,000 directly to the veterans groups Conaty represents for so-called “meetings and appearances.”

Drug companies also hired Anthony Principi, former Department of Veterans Affairs secretary under President George W. Bush, who is now a federal lobbyist. Principi, not coincidentally is also a former top executive of Pfizer, one of the most egregious drug price-gougers, and is a board member of Imprimis Pharmaceuticals.

The Yes on 61 campaign reports:


Ironically, the same individual hired by Pharma to convince vets that Prop. 61 would hurt them is the same person whose tenure as VA secretary was marred by accusations that he stopped healthcare enrollments for eligible veterans. In 2008, Principi was forced to repay the VA $3 million after an audit by the VA's inspector general revealed QTC Management Inc., a company headed by Principi both before and after his service as VA secretary, overbilled the VA $6 million under a long-term contract to conduct physical evaluations on veterans applying for disability benefits. The audit was triggered by a whistleblower's call to a VA hotline. The Principi Group has collected more than $56,000 from Big Pharma’s No on 61 campaign as of June 30, 2016. 


Conaty and his “rent a vet” operation took center stage in another California ballot initiative battle we won.

When Mercury Insurance and its CEO George Joseph tried to deregulate auto insurance in the state in 2012, and roll back protections under voter-approved landmark auto insurance reform in the state, it knew the public would oppose Prop 33 if an insurance company was known as the opponent. 

Pete Conaty made a paid appearance in the Prop 33 campaign as Mercury Insurance’s beard in 2012 as well.

Voters resoundingly rejected Prop 33 after Consumer Watchdog Campaign exposed the $17 million Mercury Insurance CEO George Joseph was spending to make more money for Mercury through the initiative and roll back the most effective auto insurance regulation in the nation.   But Conaty, wearing his Veteran’s cap and brass in the Capitol, stood with Mercury Insurance to allow it to charge low income drivers more, including retired military personnel, if they had a lapse in auto insurance, even if they didn’t drive.

Mercury Insurance trotted Conaty’s veteran clients out across the state on an issue that largely had nothing to do with them in order to falsely drape an anti-consumer position in the American flag.  Voters saw through the lie and rejected Prop 33, although our campaign against it only raised about $100,000 compared to Mercury Insurance’s $17 million: A 200 to 1 money advantage.

With drug makers spending nearly $90 million against Prop 61, and proponents led by the California Nurses Association and the AIDS Healthcare Foundation spending $10 million for Prop 61, the imbalance in dollars is better than in Prop 33 fight: 10 to 1. The California Nurses Association were with us in the Prop 33 fight too. 

Shame on Conaty and those who take the sacrifices of veterans in vain and misuse the flag to help a moneyed industry like the pharmaceutical companies that betray American values every day.   



This post was paid for by Consumer Watchdog Campaign – Yes on 61, Major Funding by Yes on Prop 61, Californians for Lower Drug Prices, With Major Funding by AIDS Healthcare Foundation and California Nurses Association PAC. FPPC ID#1387641

Jamie Court
Jamie Court
Consumer Watchdog's President and Chairman of the Board is an award-winning and nationally recognized consumer advocate. The author of three books, he has led dozens of campaigns to reform insurance companies, financial institutions, energy companies, political accountability and health care companies.

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