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As an Eli Lilly and Co. lobbyist in Washington, D.C., Jay Bonitt is hoping the Congressional “super committee” charged with trimming the federal budget doesn’t turn to the Medicare prescription drug program, known as Part D, to do so. Bonitt, Lilly's vice president of federal affairs, said the program is under budget and helps spur drugmakers to further innovation. While Lilly does not reveal how much revenue Lilly gets from the program, its biggest stars get the biggest boost from the program: Zyprexa, Cymbalta, Humalog and Evista.

IBJ: Cuts to Medicare are clearly one of the options as the super committee tries to find $1.2 trillion in savings over 10 years. Can you give your best sense for what’s on the table about Medicare Part D at this point in time?

A: I wish I could. As you can imagine, this town is just rife with rumors and speculation. Sen. [Max] Baucus (D-Montana) said he put $3 trillion out there: $1 trillion of that was in revenue raisers, another $500 billion was in Medicare [cuts]. But my understanding it was no more than a one-page plan. So we don’t know the details.

IBJ: President Obama released a plan in September that would require drugmakers to give Medicare the same generous rebates for low-income patients they give the Medicaid program. How would those price cuts—estimated at $135 billion over 10 years—impact Lilly?

A: That would be a substantial impact. We haven’t been able to determine the exact number. To impose these rebates would have a devastating impact on the industry and on innovation. If we incur a lot more cost, with the imposition of Medicaid-type rebates or a tax, then that’s less revenues that will be available for innovation.

IBJ: Medicare Part D is only six years old, and clearly Lilly and its peers did plenty of innovating before the program was created. How would scaling back its payments put innovation at risk?

A: When I first came to Lilly back in 1994, I think most of the studies showed that it cost you around $300 million to bring a drug to market. Today, the most recent Tufts University study that I’ve seen put it at about $1.2 billion now. It’s just a very, very expensive process, and it gets more expensive.

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  1. PJ - Mall operators like Simon, and most developers/ land owners, establish individual legal entities for each property to avoid having a problem location sink the ship, or simply structure the note to exclude anything but the property acting as collateral. Usually both. The big banks that lend are big boys that know the risks and aren't mad at Simon for forking over the deed and walking away.

  2. Do any of the East side residence think that Macy, JC Penny's and the other national tenants would have letft the mall if they were making money?? I have read several post about how Simon neglected the property but it sounds like the Eastsiders stopped shopping at the mall even when it was full with all of the national retailers that you want to come back to the mall. I used to work at the Dick's at Washington Square and I know for a fact it's the worst performing Dick's in the Indianapolis market. You better start shopping there before it closes also.

  3. How can any company that has the cash and other assets be allowed to simply foreclose and not pay the debt? Simon, pay the debt and sell the property yourself. Don't just stiff the bank with the loan and require them to find a buyer.

  4. If you only knew....

  5. The proposal is structured in such a way that a private company (who has competitors in the marketplace) has struck a deal to get "financing" through utility ratepayers via IPL. Competitors to BlueIndy are at disadvantage now. The story isn't "how green can we be" but how creative "financing" through captive ratepayers benefits a company whose proposal should sink or float in the competitive marketplace without customer funding. If it was a great idea there would be financing available. IBJ needs to be doing a story on the utility ratemaking piece of this (which is pretty complicated) but instead it suggests that folks are whining about paying for being green.

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