Owen Smith, British Pfizerite Blairite

This video from the USA says about itself:

Inversion: Viagra for Tax Dodgers – PARODY AD

17 April 2016

In honor of Tax Day and to highlight corporate inversions and other tax-dodging schemes, American Family Voices, Americans for Tax Fairness, and the Agenda Project Action Fund launched this ad parody video.

“Like Viagra helps men with erectile dysfunction, Inversion helps corporations with the other E.D.: earnings dysfunction,” said AFV Executive Director Lauren Windsor. “Corporate inversions and other tax avoidance schemes may be good for corporate bottom lines, but they are bad for America.”

The pharmaceutical giant [Pfizer] recently halted its corporate inversion plans with Ireland-based Allergan, after the Treasury Department and the IRS issued new rules governing such mergers, which closed off some of the major tax benefits.

Said Agenda Project Action Fund’s Erik Altieri, “Tax avoidance schemes, like corporate inversion, are just another example of unconstrained corporate greed. Large corporations dodge taxes, offshore jobs, and bend over backwards to deny their workers a living wage with decent benefits. If these companies want to sell their products in the United States, it’s time they start paying their fair share of taxes.”

The groups are urging supporters to tell the Treasury Department and Congress to close the inversion loophole permanently, and to require all American corporations to pay the taxes they owe. This video is part of a broader coalition effort encouraging supporters to submit comments to the IRS in support of the new rules.

“This video is funny, but corporate inversions are serious business. Pfizer’s inversion would have allowed it to avoid paying up to $35 billion it currently owes in U.S. taxes on the corporation’s offshore profits,” Americans for Tax Fairness Executive Director Frank Clemente said. “If collected, that could fund the National Cancer Institute for almost seven years, provide high-quality pre-school for all low-and moderate income four-year olds for nearly five years, or help pay for many of the other national priorities.”

By Steve Sweeney in Britain:

Big pharma‘s man in Labour

Monday 1st August 2016

Don’t be fooled by Owen Smith’s claims to stand up for our NHS, he’s spent his life working for the private interests destroying it, says STEVE SWEENEY

LABOUR leadership challenger Owen Smith is understandably keen to downplay his work as a lobbyist for Pfizer — but this is not the first time that concerns over his role have been raised.

In 2006, Smith failed to win back the formerly safe Labour seat of Blaenau Gwent to independent candidate Dai Davies.

In a seat that used to set record majorities for Labour, the 2006 by-election saw Smith’s candidacy slammed as “an insult to Bevan” by his opponent.

Davies went on to challenge the Labour Party to respond to criticism of its decision to stand Smith in Nye Bevan’s former seat, saying: “Mr Smith is Pfizer’s top lobbyist in Britain. He cannot avoid being linked with what many people in Blaenau Gwent and beyond may consider an obnoxious corporate strategy.

“If Mr Smith was a true socialist, as he is trying to claim in this election campaign, he would not be working for Pfizer. He has made a career decision to go and work for a company whose values seem alien to many people in this area.”

Smith held the post of Pfizer’s head of policy and government relations and was described as their “top lobbyist in the UK.” Smith and Pfizer are exactly the danger Bevan warned of when he said that “the NHS will last as long as there are folk left with the faith to fight for it.”

Pfizer donated over £40,000 to Labour’s right-wing group Progress between 2003 and 2005,

In the Netherlands, they were the main source of money for the far-right neoconservative Edmund Burke Stichting.

making it the largest corporate donor at that time.

Companies don’t donate to think tanks for nothing. On the pretext of seeking lobbying advice, undercover reporters were told by former health secretary Patricia Hewitt that packages provided by a number of think tanks included friendly reports for the media and access to key politicians. It’s easy to see why a company committed to NHS privatisation would make such a donation.

In 2009, a letter signed by Progress acting director Jessica Asato was sent to then health secretary Andy Burnham lamenting his decision to make the NHS “preferred provider” when bidding to run services and urging him to “rethink” his approach.

Pushing for an increased role for the private sector in the NHS, the letter claimed that the “private and voluntary sectors” offer innovation and “are ideally placed to help find more cost-effective and user-orientated solutions to provision as budget-holders increasingly strive for efficiency savings.”

Smith has also been embroiled in controversy around the cost of drugs to the NHS. After leaving another top lobbying post at Amgen to become a Labour MP, he said ministers should “improve incentives” for big pharmaceutical companies, warning against the use of cheaper drugs by the NHS as it may hurt the industry.

Speaking in a Commons debate in October 2010, Smith warned against the “generic substitution of epilepsy drugs” putting firms off spending money on research. Big pharma’s man on the inside was certainly playing to their tune.

It turns out there was much at stake.

In August 2015 Pfizer was slammed by the Competition and Markets Authority (CMA) in a strongly worded statement because “Pfizer and Flynn Pharma each abused a dominant position by charging excessive and unfair prices in the UK for phenytoin sodium capsules, an anti-epilepsy drug, in breach of UK and EU competition law.”

The CMA stated: “Prior to September 2012, the NHS spent approximately £2.3 million on phenytoin sodium capsules annually.”

Pfizer then sold distribution rights to Flynn, continuing to manufacture the capsules but selling them on to Flynn at prices “significantly higher” than it had previously charged in Britain.

“This spend (paid to Flynn and other suppliers of phenytoin sodium capsules) was just over £50m in 2013 and over £40m, in 2014,” said the CMA, which is due to issue a final ruling in the case in September.

The cost of the anti-epilepsy drug had spiralled, increasing by as much as 2,600 per cent.

The National Institute for Health and Care Excellence (Nice) has already ruled that the cost of some drugs are too high, however Pfizer continue to lobby for changes in the rules so its drugs can make their way to the British market. They accuse Nice of blocking innovation and “denying patients access to some of the best treatments available.”

What Pfizer really means is that the NHS is a barrier to its profit margin.

It has other ways of ensuring this is increased however. In 2012 it was revealed that Pfizer paid no tax to the British government. In 2011, despite having a turnover of £1.8 billion on UK sales, Pfizer suggested that it made operating losses of £59m in 2011 and £46m in 2010. While acting lawfully, this effectively means money that would be spent on the NHS has ended up lining the pockets of shareholders.

In 2015, following a controversial and ultimately unsuccessful attempt to take over AstraZeneca, Pfizer finally struck a deal with Irish-based company Allergan.

In a statement announcing the merger, Pfizer said it “anticipates that the combined company will have a pro-forma adjusted effective tax rate of approximately 17-18 per cent.”

This would have meant a reduction from a tax bill of 26 per cent simply by shifting its base to Ireland to take advantage of lower rates of corporation tax. The merger was called off in April 2016 due to new US Treasury rules on paying taxes.

Smith has also voiced support for private finance initiatives, saying: “We’ve had PFI in Wales, we’ve had a hospital built down in Baglan through PFI. If PFI works, then let’s do it. What people want to see are more hospitals, better services.

“I’m not someone, frankly, who gets terribly wound up about some of the ideological nuances that get read into some of these things, and I think sometimes they are totally overblown.”

Welsh Labour’s 2011 Assembly manifesto included the pledge to “continue to rule out the use of PFI in health services” — and with good reason.

The hospital that Smith refers to is hardly an example of a resounding success for PFI-built hospitals. Within a year of opening services had been downgraded, it did not take accident and emergency cases and there was a campaign to save the maternity services at the hospital which faced being downgraded or lost altogether.

Porters were outsourced and then threatened industrial action due to short staffing. Costs spiralled and the initial £66m outlay multiplied, with the taxpayer facing a potential bill of over £300m.

That is just how “overblown” the “ideological nuances” Smith refers to are. PFI deals have been widely condemned as poor value for money and have led the NHS into massive debt. NHS trusts owe £80bn in PFI loan repayments and maintenance charges and this year alone almost £2bn will be paid to private-sector companies.

Peterborough City Hospital is a prime example of how PFI goes wrong, with the trust spending around £42m a year servicing its PFI debts, wracking up an annual deficit of almost £40m.

The PFI deal, which was heavily criticised at the time, is simply bankrupting the trust which cannot repay the PFI debt.

The hospital was offered to the private sector but since the collapse of the nearby Hinchingbrooke Hospital franchise deal the health profiteers seem lukewarm on the idea.

Shadow health secretary Diane Abbott warned last week that the trust needs a government cash injection of £650m due to the wasteful deal.

Smith comes from the murky world of corporate lobbying and claims that he is a supporter of the NHS are easily dismissed. There is now a Labour Party leadership election which is a battle for the soul of the party. The track records of both Jeremy Corbyn and Smith speak for themselves.

Like a snake-oil salesman, Smith desperately tries to portray himself as a defender of the NHS when he has spent most of his career working in senior roles for companies that actively seek to undermine it and promotes schemes that have plunged NHS trusts into massive debt.

Corbyn has promised an end to NHS privatisation and has spent his entire political career fighting for the NHS and health workers, most recently speaking at rallies in support of striking junior doctors.

One thing we can be sure of, the NHS is not safe in Smith’s hands. Don’t be fooled by Owen’s myth.

10 thoughts on “Owen Smith, British Pfizerite Blairite

  1. Wednesday 3rd August 2016

    posted by Morning Star in Editorial

    THERE are broader issues at play in yesterday’s High Court ruling that the NHS is responsible for funding a new preventative drug than appear on the surface.

    Superficially, it was a dispute between councils and the health service as to who should pay for such medication.

    The NHS said councils should because they’re the ones that deal with public health and prevention. Councils said it was up to the NHS as they don’t have the money.

    Though of course the NHS is hardly awash with cash thanks to six years of Conservative and Liberal Democrat cuts and the crushing burden of private finance initiative debt rung up by New Labour and the Tories.

    Councils meanwhile have had their budgets slashed by 40 per cent, forcing them to drastically pare back the services they provide.

    Obviously, both should have their funding levels restored and expanded, with more radical action taken to prevent public money being leeched off by profiteers.

    However, something else needs addressing: the cost of brand-name drugs to the health service.

    The goal should surely be that NHS experts can evaluate new medications and, if they prove safe and effective, introduce them without too much fuss.

    But the eye-watering prices charged by pharmaceutical companies for their patented wares interferes with this, in a way that shows very clearly how the capitalist market stands at odds with human needs.

    The story told by, say, Pfizer goes like this: it spends vast sums of money on life-saving new treatments and needs the monopoly granted by drug patents in order to recoup the cost and fund yet more research.

    Naturally that’s not exactly the case. The biggest drugs firms spend far more on sales and marketing than on research and development.

    Picking Pfizer again, for no reason in particular, in 2013 it spent $6.6 billion on research and $11.4bn on marketing, lobbying, etc.

    Only one of the top 10 that year spent more on research — and only 4 per cent more than its marketing budget.

    And obviously these companies’ research often depends on previous publicly funded work, forming a huge public subsidy to private profit.

    Questions also arise as to what drugs giants spend their research budgets on. A British Medical Journal study in 2012 noted that the market rewarded companies that developed drugs very similar to existing ones — but different enough that they could be patented and profited from.

    “Pharmaceutical research and development turns out mostly minor variations on existing drugs,” Donald Light and Joel Lexchin wrote.

    “Sales from these drugs generate steady profits throughout the ups and downs of blockbusters coming off patents.”

    Meanwhile killer diseases such as malaria and TB don’t attract much attention because the victims are mostly poor, developing remedies can be difficult, and as such the problem is left yet again to public funding.

    No-one doubts the importance of drugs research and manufacturing. But the current situation where pharmaceutical companies pursue the most profitable products over the most needed medicines, spend billions to promote and sell them regardless of the medical need, and ration access to life-saving treatments through high prices is unacceptable.

    Instead we should aim for an ambitious programme of publicly funded research that is coupled with strong support for manufacturing affordable “generic” medicines.

    The research having been done, the science and the end result should be offered to all in need. No-one should suffer from treatable diseases because someone else wants to fill their pockets.

    Having brought some rationality to the system, health officials wouldn’t have to have waste time on court fights like the one we’ve just witnessed and instead decide in the best interests of public health.



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