Pharma’s State Capture

Medical research is captured by the pharmaceutical industry. Medical education transmits that captured research to doctors. Clinical guidelines convert it into the standard of care. But the government institutions meant to act as a check on the pharmaceutical industry have themselves become captured by the industry they are supposed to oversee.

Through lobbying, campaign contributions, regulatory funding, revolving-door employment, advisory committees, and government partnerships, pharmaceutical companies have built a network of influence that extends from lawmakers and federal agencies to global regulatory systems.

Pharmaceutical companies don’t just influence the regulators who oversee them—they also influence the politicians who appoint those regulators, fund government agencies, and write the laws governing the industry. The pharmaceutical industry is one of the largest and most powerful lobbying forces in Washington.

Between 1999 and 2018, the pharmaceutical and health products industry spent approximately $4.7 billion lobbying the U.S. federal government—more than any other industry. But this wasn’t simply health-sector spending; it was driven primarily by pharmaceutical interests. PhRMA, the industry’s largest trade association, was the biggest spender at $422 million, followed by pharmaceutical giants Pfizer, Amgen, and Eli Lilly. The industry also contributed another $1.3 billion in federal and state campaign contributions, bringing its disclosed political spending during that period to more than $6 billion.

This money isn’t spread evenly across Congress—it follows power. Among the 40 largest recipients of pharmaceutical campaign contributions between 1999 and 2018, 39 served on healthcare committees, and 24 held leadership positions on those committees. These are the lawmakers who write the rules governing pharmaceutical regulation and the healthcare system itself.

Over the past four decades, Congress has repeatedly reshaped the legal framework of medicine through policies that granted the pharmaceutical industry an extraordinary combination of protections and institutional advantages.

In 1986, Congress created a vaccine injury compensation system that effectively eliminated lawsuits against vaccine manufacturers. In 1992, the Prescription Drug User Fee Act (PDUFA) allowed pharmaceutical companies to directly fund the FDA’s drug-review process. In 2005, Congress passed the PREP Act, creating broad liability protections for pharmaceutical manufacturers during declared public health emergencies. Those protections were invoked in 2020 through the COVID-19 PREP Act Declaration, shielding pharmaceutical companies from liability for the harms caused by their products.

These examples represent an unusually extensive combination of legal protections and institutional advantages—from funding the regulator overseeing them to receiving sweeping liability protections rarely seen in other industries.

Government doesn’t just regulate medicine—it plays a major role in determining what gets studied.

Scientific progress doesn’t occur in a vacuum—it follows funding. The National Institutes of Health (NIH) is the world’s largest funder of medical research, distributing tens of billions of dollars in grants each year. Those funding decisions shape the direction of modern medicine. They determine which diseases receive attention, which questions get investigated, and which medical interventions gain institutional momentum.

But government-funded research doesn’t remain purely academic. The commercialization of publicly funded research accelerated after the 1980 Bayh-Dole Act, which allowed federally funded institutions to patent discoveries and license them to private companies. This created financial incentives tied to the commercial success of pharmaceutical products. A 2020 Government Accountability Office review found that NIH research generated roughly $2 billion in royalty revenue through licensing agreements. Several individual licenses generated more than $100 million each. The NIH doesn’t merely fund medical research—it also receives royalty payments when publicly funded discoveries become commercial pharmaceutical products.

These incentives also extend to individual NIH scientists. A 2005 review found that 916 current and former NIH researchers received royalty payments, averaging nearly $10,000 annually, with some individuals receiving up to $150,000. More recently, a 2022 investigation estimated that NIH scientists received roughly $350 million in royalty payments between 2010 and 2020.

The result is a shift in institutional incentives. Through funding priorities, commercialization policies, and royalty arrangements, government institutions have become financially connected to the success of the pharmaceutical products that emerge from publicly funded research.

Regulatory capture occurs when the institutions meant to regulate an industry become structurally aligned with the interests of that industry. The Food and Drug Administration (FDA)—the agency responsible for deciding which drugs reach the market—is the clearest example.

A regulator funded primarily by the industry it regulates faces an inherent conflict of incentives.

That funding relationship began in 1992 with the passage of the Prescription Drug User Fee Act (PDUFA), which allowed pharmaceutical companies to fund the FDA’s prescription-drug review process in exchange for negotiated review timelines. What began as a supplemental funding mechanism became the foundation of the program: user fees financed just 7% of the FDA’s drug-review program in 1993, but approximately 77% by 2025. Today, pharmaceutical companies seeking approval for their products fund more than three-quarters of the program responsible for evaluating them.

PDUFA did more than fund the FDA—it created a system in which the FDA repeatedly asks the pharmaceutical industry what it must do to secure its funding. Every five years, the FDA and industry negotiate the user-fee agreement that sets funding levels, performance goals, and review timelines.

The consequences are measurable. A 2008 study of more than 300 FDA drug approvals found that each one-month reduction in review time was associated with an increased count of serious adverse drug reactions, while finding little evidence that the additional user-fee funding improved safety reviews .

When the regulator depends on the industry it regulates for most of its funding—and that industry helps shape the terms of that funding—it becomes structurally aligned with industry interests.

Financial dependence is only one form of regulatory capture. The revolving door between pharmaceutical companies and the agencies that regulate them is another.

Officials routinely move between senior positions in government and the pharmaceutical industry. A 2023 Health Affairs study found that among senior Department of Health and Human Services appointees between 2004 and 2020, 32% left government for industry positions, while only 15% entered government from industry, creating a substantial net flow from public service into the private sector. The imbalance was greatest at the CDC, where 54% of appointees later moved into industry positions, compared with only 8% entering government from industry.

The pattern is particularly pronounced among FDA leadership. All but one FDA commissioner from the early 1980s through 2019 later moved into roles within the pharmaceutical industry. Former FDA Commissioner Dr. Scott Gottlieb joined Pfizer’s board in 2019, less than four months after leaving the agency.

The pattern extends beyond senior leadership. A 2018 Science investigation found that 11 of 16 departing FDA medical reviewers later accepted positions with the very companies whose products they had recently evaluated.

The issue is incentives. When regulators know that the companies they oversee may become their future employers, the regulatory system favors continuity with industry rather than independence from it.

Many of the FDA’s most important decisions are influenced by advisory committees composed of outside physicians and researchers. Their recommendations frequently shape the agency’s final decisions.

Financial relationships with industry are common among committee members. A 2006 JAMA analysis found that at least one member was financially conflicted in 73% of FDA drug-advisory meetings, while fewer than 1% of conflicted scientists were recused. A 2014 study examining more than 15,000 FDA advisory-committee votes found that members with financial ties to the sponsoring company were significantly more likely to vote in that company’s favor.

Advisory committees are not merely symbolic. A 2023 JAMA Health Forum study found that the FDA’s final decisions aligned with advisory-committee recommendations in approximately 88% of cases.

The issue is not individual misconduct but structural incentives. When regulators depend on industry funding, rely on advisers with industry ties, and share a revolving door with the companies they oversee, pharmaceutical influence becomes embedded within the institutions responsible for regulating it.

Government influence over medicine doesn’t end when a drug is approved—it extends to the recommendations that determine how drugs are used in practice.

Unlike the FDA, the Centers for Disease Control and Prevention (CDC) doesn’t decide whether pharmaceutical products reach the market; its influence operates through public health recommendations. Through bodies such as the Advisory Committee on Immunization Practices (ACIP), the CDC develops vaccine schedules that determine the policies and practices of physicians, hospitals, insurers, schools, employers, and public-health agencies throughout the United States. These recommendations effectively become the standard of care.

This makes the CDC one of the most influential institutions in modern medicine. Regulatory approval allows a product to be sold. Government recommendations determine how widely it is used.

Like other government advisory bodies, ACIP relies on outside advisers. Many have conducted industry-funded research, consulted for pharmaceutical companies, or collaborated with industry. A 2025 analysis of 25 years of conflicts among ACIP and FDA vaccine-advisory committee members found that officially reported financial conflicts had declined over time, but the analysis relied on a narrow 12-month reporting window and measured only formally disclosed conflicts. A 2021 BMJ investigation found that independent reviews of committee members’ industry ties identified significant financial relationships that fell outside official disclosure requirements.

When oversight agencies become too closely aligned with the industry they regulate, dissent becomes costly, oversight becomes protection, and protecting the interests of the pharmaceutical industry becomes intertwined with protecting the credibility of the agencies responsible for overseeing it.

Agency employees who raise safety concerns or question positions aligned with industry interests face professional consequences rather than institutional support.

A 2006 survey of 997 FDA scientists found widespread concerns about political interference and retaliation. Sixty-one percent said they knew of cases where political appointees had inappropriately intervened in FDA determinations or actions. More than one-third said they didn’t feel they could express safety concerns even within the agency, while 18% reported being asked, for non-scientific reasons, to exclude or alter technical information or conclusions in FDA documents.

These concerns were not limited to the FDA. A 2022 Government Accountability Office review found similar problems across the Department of Health and Human Services, including the FDA, CDC, and NIH. Although employees described observing what they believed to be political interference in scientific work, the agencies reported no formal internal allegations between 2010 and 2021. Employees told investigators they chose not to report their concerns because they feared retaliation.

The consequence isn’t only individual retaliation, but institutional distrust. A 2004 Department of Health and Human Services Inspector General survey found that two-thirds of FDA scientists lacked confidence that the agency adequately monitored the safety of prescription drugs.

In 2009, a group of FDA scientists took the extraordinary step of bypassing agency leadership and writing directly to President Obama, warning that scientific concerns were being suppressed and that political and institutional interests had taken precedence over public safety.

The experience of Dr. David Graham illustrates this dynamic. In 2004, Graham, Associate Director in the FDA’s Office of Drug Safety, testified before Congress that senior FDA officials attempted to intimidate him and discourage him from publicly raising concerns after he concluded that the painkiller Vioxx had contributed to tens of thousands of heart attacks and strokes.

In a healthy regulatory system, violations should result in consequences severe enough to discourage future misconduct. In a captured system, that relationship is reversed. Oversight becomes less about holding industry accountable and more about preserving institutional stability and managing reputational damage.

Pharmaceutical companies have repeatedly paid billions of dollars in civil and criminal settlements for unlawful marketing, fraud, and regulatory violations. Yet the penalties imposed are often only a fraction of the financial benefits generated by the misconduct. A 2026 JAMA Network Open study examining pharmaceutical anti-kickback settlements found that companies paid a median penalty equal to only 2.2% of the U.S. revenue generated by the drugs involved during the period of violations. Settlements are treated as a cost of doing business rather than a meaningful deterrent.

The pattern is not limited to individual cases. A separate 2020 JAMA analysis of 26 major pharmaceutical companies found that 22 faced financial penalties between 2003 and 2016, totaling $33 billion. The violations were not isolated mistakes: all but one company faced penalties linked to illegal activities spanning four or more years, and GlaxoSmithKline alone faced 27 separate penalties. The persistence of misconduct across major firms shows that these penalties do not function as a genuine deterrent.

The same pattern appears in product safety. An analysis of drugs approved by the FDA between 2001 and 2010 found that roughly one-third later received major safety warnings, required significant regulatory action, or were withdrawn because of previously unrecognized safety problems. A system designed to protect the public shouldn’t repeatedly discover serious safety problems only after widespread exposure has already occurred.

The United States is the world’s largest pharmaceutical market and home to many of the world’s largest pharmaceutical companies. As a result, its political, regulatory, and research institutions play a disproportionate role in shaping global standards for how drugs are evaluated, approved, and used.

When industry influence becomes embedded within these institutions, the consequences extend far beyond American borders. The same companies operate across jurisdictions, and the same regulatory frameworks are increasingly adopted across countries.

The FDA is not merely an American regulator. It is a central institution in the global pharmaceutical system, with decisions that influence how medicines are evaluated, approved, and monitored around the world.

A 2026 analysis of 396 novel therapeutics found that 70.7% received their first approval from the FDA, placing the agency at the front of the global regulatory pathway for most new medicines.

Because of this position, many regulatory authorities rely on FDA reviews when evaluating new medicines. Rather than repeating the entire process themselves, smaller regulators often use the FDA’s assessments, clinical data, and regulatory conclusions as the basis for their own decisions. The result is regulatory spillover: decisions made by the FDA often become the foundation for regulatory decisions made elsewhere.

The FDA’s influence extends beyond individual approvals. Its regulatory philosophy also shapes the standards adopted by other regulators, influencing evidence requirements and approval pathways globally.

Organizations such as the International Council for Harmonisation (ICH) develop shared standards for pharmaceutical development and regulatory review. These standards are intended to reduce duplication and facilitate international drug approval, but they also mean that regulatory approaches developed within the world’s largest pharmaceutical markets increasingly shape global practice.

Unlike a purely governmental body, ICH brings together regulatory authorities and pharmaceutical industry representatives to develop these standards. Once adopted, they become embedded in national regulatory systems around the world.

The result is regulatory convergence: standards developed in the world’s largest pharmaceutical markets become embedded in regulatory systems globally.

When the institutions that shape global pharmaceutical standards become aligned with the industry they regulate, the same institutional incentives are exported alongside the standards themselves.

Pharmaceutical capture doesn’t end with research, education, or clinical practice. It extends into the institutions responsible for regulating, funding, and governing medicine itself.

The system doesn’t require every politician, regulator, or scientist to act in the interests of industry. It only requires incentives to be structured in ways that make alignment with industry the path of least resistance.

Lobbying shapes legislation. Industry funding shapes regulatory priorities. The revolving door shapes institutional culture. Advisory relationships shape decision-making. International harmonization spreads those standards beyond national borders.

The result is a regulatory system where the institutions meant to protect the public are increasingly dependent on, connected to, and influenced by the industry they oversee.

The pharmaceutical industry doesn’t need to control every decision. It only needs to shape the system in which those decisions are made.

This article is part of the Epistemic Capture of Medicine: The Definitive Crash Course series:

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