David Ellis - In the Company of Liars

“I am the director of governmental affairs, Midwest region, for Flanagan-Maxx Pharmaceuticals,” he says.

Technically, Walter Benjamin is on paid leave at the moment, but McGaffrey will get to that, no doubt. He doesn’t start there. He starts with the company, Flanagan-Maxx, a massive international corporation that “discovers, develops, and markets breakthrough drugs.”

McGaffrey takes him through the countries where they have offices and laboratories, the different areas of medicine, the different departments-pharmaceutical, nutritional, and hospital products. The company has billions in revenue worldwide. The point seems to be to cast Flanagan-Maxx as the cold, heartless corporate giant.

“Let’s talk about the pharmaceutical products division, sir,” McGaffrey suggests.

McCoy moves in her seat. She wants this testimony to be over, and it’s just beginning. There is no drama here, this part. F-M makes drugs for virtually anything, from brain disorders to respiratory infections to organ transplants to HIV/AIDS treatment.

“Let’s talk about a particular product, sir,” says McGaffrey. He has a commanding voice but not as deep as she expected. He compensates for this with high volume. His every word in this courtroom is a controlled shout. “Let’s talk about a product called Divalpro.”

Walter Benjamin nods without enthusiasm, adjusts his glasses again, and begins to explain it to the judge. Divalpro is a drug marketed to seniors for high blood pressure, one of the most successful products in the Flanagan-Maxx line, one of their cash cows. There is only one problem with Divalpro, a problem that is now known to anyone who follows the news, and certainly to anyone in the state capital.

Divalpro’s patent is about to expire. Which means problems for Flanagan-Maxx. It means copycats. Worst of all, it means generic substitutes, drugs with the same active ingredient as Divalpro but cheaper, much cheaper, and therefore more attractive to the state Medicaid system than the expensive name-brand drug.

“Explain, if you would, Mr. Benjamin, the prior-approval list.”

This, of course, was the main problem here. The state’s department of public aid, always looking to cut costs, installs an immediate preference for cheaper generic alternatives by implementing a “prior approval” system. All generic alternatives receive prior approval from the state Medicaid system, so a doctor can prescribe them by signing a piece of paper. If the doctor wants to prescribe the more expensive, name-brand drug like Divalpro, he or she is required to go through considerable paperwork for approval. Which one is the doctor going to choose? The patients will ask for Divalpro, given its past monopoly and a considerable advertising campaign through direct mail and television, but the doctor will assure them that the generic alternative is essentially the identical drug. Flanagan-Maxx’s profits on this drug will take a nosedive.

This was where Walter Benjamin, director of governmental affairs, came in. It was time to hit up the legislatures in the seven states he covers, including this one, for legislation to get Divalpro placed on the prior-approval list of medications. If Flanagan-Maxx could pull that off, it would be on the same footing as the generics and would maintain a considerable portion of its client base.

“We weren’t asking for preference,” Benjamin emphasizes, ever the company man. “We just wanted to be on the same footing as the generics. We just wanted a level playing field.”

Sure, and never mind that the state will be spending millions on a drug that could be spent elsewhere in the Medicaid program, when the generic alternative is every bit as effective.

“And Mr. Benjamin, in your capacity as director of governmental affairs, did you personally, sir, go to our state capital and plead your case?”

“No.”

“Who did?”

“We retained the services of Dillon and Becker.”

“And who at that firm in particular?”

“Sam Dillon.”

“Sam Dillon? The deceased in this case?”

“Yes.”

“Why Sam Dillon?”

McCoy studies the witness’s face. Walter Benjamin has probably asked himself that very question countless times since February.Why Sam Dillon? Why did I have to choose Sam?

“We hired Sam because he knew his way around the capital, so to speak. He was a former state senator. He was a Republican. He was very good.”

“And why a Republican?”

“The state House is Republican. By a slim majority, but a majority nonetheless. And the governor is, too.”

McGaffrey pauses. McCoy holds her breath.

There is no mention of the state Senate.

McCoy smiles.

“Would it be fair to say that Sam Dillon was one of the most influential lobbyists in the game?”

The prosecutor, Roger Ogren, squirms in his seat.

“Absolutely,” Benjamin says.

“Did Sam Dillon lobby on behalf of Flanagan-Maxx in last year’s legislative session?”

“Yes. Last year’s veto session.”

“Can you explain that to the Court?”

The witness looks at the judge. “For two weeks in November, the legislature reconvenes to consider legislation that was vetoed by the governor. They decide whether to override the veto. But technically, they can consider other legislation as well. We had introduced a bill in the House during the regular legislative session last year, but it was carried over to the veto session. It was during veto session that they voted on it.”

“Are you familiar with House Bill 1551?”

“I am.”

“What is House Bill 1551?”

Anyone with a pulse in this town knows about House Bill 1551, if not by number. Anyone who has read the accounts since the grand jury was convened in February knows the dirty details, which Walter Benjamin will now reluctantly impart. House Bill 1551 was the bill in the state’s House of Representatives that put Divalpro on the prior-approval list. Sam Dillon, for all of his considerable talents as a lobbyist, couldn’t get the bill passed during the regular legislative session. By all accounts, he had the House and Governor Trotter but was short in the Senate, by three votes to be exact. The problem was Flanagan-Maxx itself, a large drug company that did not have many friends in the legislature, particularly not in the Democratic-controlled Senate. The lobbies for the elderly and the poor, having fought for years for more dollars for the Medicaid program, argued fiercely against a bill that would prevent the savings of millions once the generics came aboard.

Dillon couldn’t get it out of the Senate, long and short, and the Speaker of the House wasn’t going to call it for a vote, and have his members take the heat, just to see it die in the Senate. So Sam Dillon asked the Speaker of the House to hold the bill over until veto session, hoping that the summer recess might change some minds.

Miracle of miracles, it did. Three senators switched their votes, and in the space of twenty-four hours, both the House and Senate passed House Bill 1551 and sent it to the governor. Why, precisely, these three senators changed their votes over summer recess is the focus of the federal grand jury investigation.

“So it’s law right now,” McGaffrey concludes. “State law recognizes Divalpro as being on the prior-approval list, once its patent expires this summer.”

“Correct.” For having accomplished such a feat, Walter Benjamin looks remarkably unhappy about it.

And the judge is about to hear why.

Ron McGaffrey clears his throat, strangles the lectern on each side. “Now, Mr. Benjamin, in the course of your duties as director of intergovernmental affairs, has it come to your attention that Sam Dillon may have used illicit means to gain the support of certain members of the state legislature?”