There has been enough information in the last two weeks on the outrageous practices of the major drug manufacturers to warrant extensive investigations by Congress, the Food and Drug Administration, the Federal Trade Commission, and the Justice Department, not to mention both Congressional ethics committees.

In just that short period, the public has learned that the major drug manufacturers, PhRMa and other lobbysts (BIO) did all of the following:

– They hoodwinked the White House on their financial plight, pleading financial hardship when their prospects were exactly the opposite;

– They effectively bribed numerous members of Congress and the White House through millions in "legal" campaign donations and promises of future support;

– Genentech and BIO flooded Congress with lobbyists who turned members of both parties into stenographic shills for the drug makers (details from Marcy Wheeler, here and here);

– They conned Congress into proposing unjustified, lengthy and semi-permanent "evergreening" extensions of patent and exclusivity prohibitions on generics and bio-similars (more here and here);

– And they conned the Senate Finance Committee into shielding them from competition from drug imports and Medicare negotiations.

If we weren’t already conditioned by hundred billion dollar bailouts for Wall Street and wealth transfers engineered by government to benefit America’s financial hooligans at taxpayers’ expense, we would see this year’s aggregate "drug deal" as one of the most massive, corrupt scams in our history. Afghanistan has nothing on us.

So the question the White House and members of the Senate Finance Committee need to answer is whether the supposed "deal" they cut with PhRMa earlier is still in effect? Do they still defend this scandal? Does Harry Reid?

It’s now clear that the White House was, at best, connned and allowed the American taxpayers to get fleeced. As the New York Times reports today, not only are the major drug makers arbitrarily raising prices at rates that will overwhelm the promised $80 billion "savings" from the White House drug deal, but the poor-little-us storyline PhRMa gave the White House was a complete sham:

And the drug industry’s own major consulting firm, IMS Health, has also reported a significant run-up in prices. Back in April, IMS predicted that United States drug sales might actually decline this year.

Billy Tauzin, president of the industry’s trade association, highlighted the gloomy prediction in a June 1 letter to President Obama shortly before striking the deal to cut drug costs by $80 billion. In negotiating the deal, the drug makers argued that they could not afford to give up more than that.

But in October, IMS made an unusual change in the middle of its forecasting cycle, saying it now believed United States sales would grow at least 4.5 percent in 2009 — or $21 billion more than expected six months earlier.

A major reason, IMS said, was higher-than-expected price increases for drugs in the United States.

And what excuses do the drug makers have for dramatically raising prices? Since the major increases are coming on established brand-name drugs whose research and development costs are already incurred, they cannot claim increases in ongoing marginal costs. Nor is there any pretense of changed market fundamentals, since there is no claim of lost supply capacity or increased demand (reforms that add 30 million more insured don’t take effect until 2013).

This is just straight non-competitive price fixing, based on sheer market power. There should be alarm bells going off at the FTC and DOJ, and everyone should be dusting off the FTC studies that told us the drug makers did not need anti-competitive 12-year patents/exclusivity shields from generics and bio-similars. And is there any excuse left for not allowing imports and Medicare to bargain the drug cartels down to size?

Last month, our government warned the Afghans to clean up their drug corruption act if they expected an increased American security commitment. What if the roles were reversed?

If this were up to President Karzai, I’d advise him not to send any further assistance to the US government until it shows it can stand up to the drug lords and end the massive drug related corruption of the central government that prevents it from serving its own people. That is, after all, an American principle, isn’t it?