Last night, Jon Cohn reported on damning evidence that the pharmaceutical industry would stand to gain prohibitively from the health care bills passing through Congress. Despite a pledge of giving back $80 billion in profits over ten years as part of a celebrated “deal” between PhRMa and the White House, health reform wouldn’t cut into industry profits at all. In fact their profit margins would increase.

It comes from an October forecast by IMS Health, a respected global research and consulting firm. The report, which IMS distributed to clients and which a source provided, projects that the drug industry will see average annual growth of 3.5 percent between 2008 and 2013.

Back in March, IMS had projected no growth at all during that same five-year stretch. In fact, it projected the drug business would actually contract slightly–with negative annual growth of 0.01 percent.

What changed? A major factor, according to IMS, was the emerging details of health care reform.

We’re talking about hundreds of billions of dollars in revenue for the drug industry over the next 10 years. And this is based on details in the health care bill driving customers to name-brand drugs.

This is part of an emerging pattern when the medical industry in general, despite grumbling about reform, would actually benefit from it. The grumbles are designed to lock in the gains they’ve already made and reach for more. In order to keep stakeholders on the side of reform, the White House bought them off. That’s pretty clear. In fact, that’s exactly what the President told me on a conference call four months ago.

I cannot expect the hospital association, for example, to sign up for something they don’t think is right for hospitals and exepct them to back reform. So I understand what they’re doing to protect their interests. I think we can negotiate and find a good way to go about this. In theory we could cram down additional savings, but to have the American Medical Association, the American Nurses Association, the drugmakers, the insurance companies, all of them on our team, that does help us move the process forward. Theoretically, there should be enormous savings inside the system. We all know that we pay more for health care than we should, and we shouldn’t need additional revenue. But that’s harder to do in practice, because all these powerful interests block the efforts. What I think is that we can get a framework where reform begins, one with an insurance exchange, and a robust public option, concrete reductions in cost, prevention, health IT, comparative effectiveness research, and it will be possible to achieve greater savings with a more efficient system down the road. And we can revisit the policy 10 years from now and possibly see even more savings than what was scored and anticipated.

You cannot understand getting Barbara Boxer’s name on a letter to extend exclusivity on biologics for twelve years without recognizing the tremendous power of stakeholders in health care.

The pharmaceutical industry responded to the IMS forecast today:

“Online stories suggesting that America’s pharmaceutical industry will reap substantial benefits as the result of comprehensive health care reform are misleading and, in some cases, inaccurate because they are based on incomplete and outdated information.

“Projecting annual prescription drug sales is notoriously tricky, evident by the fact that IMS Health has released three different forecasts for 2009. Most troubling, the IMS report is based on incomplete information because it does not take into account discounts and rebates which can significantly lower the cost of drugs to payers.

“In some ways, it’s like trying to project annual U.S. auto sales by adding up sticker prices. That’s not reality. How many people actually pay full price for a car? Similarly, drug manufacturers often offer steep discounts and rebates through private negotiations. Medicare Part D is a good example. The Medicare Trustees, who unlike IMS have access to rebate data, report that rebates in the Medicare prescription drug program reach 20%-30% for many brand-name drugs and have increased over the past several years.

Because basically everything is unknowable, PhRMa can credibly claim that their deal would be a win for consumers. But IMS Health has done this kind of research all the time, and there’s really no reason to question their numbers. Especially if you just use common sense.