Democrats call on Office of Congressional Ethics to investigate Donald Trump’s HHS pick: Tom Price traded thousands in medical stocks while in Congress

Democrats want to delay hearing on eight "troublesome" Trump Cabinet picks

By Sophia Tesfaye

Senior Politics Editor

Published January 5, 2017 6:40PM (EST)

Elevators close on Rep. Tom Price, R-Ga., as he arrives at Trump Tower, Wednesday, Nov. 16, 2016, in New York. (AP Photo/Carolyn Kaster) (AP)
Elevators close on Rep. Tom Price, R-Ga., as he arrives at Trump Tower, Wednesday, Nov. 16, 2016, in New York. (AP Photo/Carolyn Kaster) (AP)

Days after widespread public pressure forced Republicans in the House to drop their shady attempt to gut the Office of Congressional Ethics, Democrats called upon the independent body to investigate Donald Trump’s pick to run the Health and Human Services Department.

Georgia Republican Congressman Tom Price was likely tapped to lead the massive federal agency by the president-elect because of his staunch opposition to the Affordable Care Act, which has provided health insurance coverage to 20 million Americans. As chairman of the House Budget Committee and as a member of the House Ways and Means Subcommittee on Health, Price has been a leading Republican in the campaign to repeal President Obama’s health care law. But it is Price’s private dealings while leading the powerful House committee that has Senate Democrats demanding an investigation into the potential Trump Cabinet member before his confirmation hearing on Jan. 18.

As Salon reported last month, Price owns significant stock shares in several companies with business before the federal regulatory agency he is set to run. A Wall Street Journal review of Price’s stock trades also found hundreds of thousands of dollars in transactions that involved health sector companies. The Journal alleged Price traded more than $300,000 in shares of health-related companies during his time in Congress, all "while sponsoring and advocating legislation that potentially could affect those companies' stocks."

Several of Price’s top campaign contributors are medical companies. As HHS secretary, Price would have direct influence over crucial regulatory and approval decisions impacting the donors that have funded his political career:

Price’s top contributor, MiMedx, a Georgia-based medical company that makes regenerative wound care products, is currently locked in a debate with the FDA over how the agency should regulate its products, RollCall reported. The agency could impose marketing restrictions or even force MiMedx to halt sales that made up 12 percent of its revenue last year, a possibility MiMedx warned its investors about in a recent regulatory filing.  

MiMedx donated $21,800 this cycle to Price’s campaign funds, according to the nonpartisan Center for Responsive Politics.

The FDA, which Price would control as HHS secretary, is also hashing out rules that would affect another top Price campaign contributor.

Amgen, the makers of products to treat cancer and rheumatoid arthritis, contributed $14,000 to Price this cycle.

The FDA is now considering new rules for biotech drugs that may influence the adoption of Amgen’s products and the rate at which it may lose sales to competing generic versions. In a recent regulatory filing, the company noted that Price’s agency “has substantial power to quickly implement policy changes that can significantly affect how our products are covered.”

Around 90 percent of Price’s annual budget at HHS will go the Centers for Medicare and Medicaid Services, a top purchaser of Amgen products.

According to Price’s own financial disclosure, required for members of Congress, the Georgia Republican recently bought between $50,001 and $100,000 worth of stock in a biomedical company in which a member of Trump’s transition team is a director. New York Republican Chris Collins retains an ownership stake worth up to $25 million in Innate Immunotherapeutics, Ltd. The pharmaceutical firm has noted the potential benefits of having Collins invested in its success, touting Collins’ status as a member of the Energy and Commerce committee in its annual report.

Citing reports that Price "conducted over 630 trades on the stock market" while serving in a role of oversight in Congress, Senate Minority Leader Chuck Schumer announced Thursday that Public Citizen–an anti-corruption watchdog– filed a complaint with the Office of Congressional Ethics as well as the Securities and Exchange Commission to investigate Price's trading.

"Every American should be shocked by this," Schumer said at a news conference.

"We are here to call on the House Office of Congressional Ethics to investigate if any laws were broken," Schumer announced. "There's enough evidence here that cries out for an investigation. Whether the law was actually broken, whether there was quid pro quos or inside information is the better way to put it -- we don't know."

Schumer was joined by fellow Democratic Sens. Patty Murray and Ron Wyden, each a top Democrat on two separate Senate committees set to hold confirmation hearings on Price.

"I urge Republicans to work with us to make sure we have all of the facts in front of us and they are fully reviewed before Congressman Price advances," Sen. Murray, of Washington, said during the press conference.

“The questions are serious enough that it raises this to a level that we believe an investigation must occur so that members — Republicans and Democrats — are confident that if this nomination moves forward, they're voting for someone that they clearly have the information on that we do not have today," Murray said. "We have a responsibility."

Craig Holman, government affairs lobbyist for Public Citizen’s Congress Watch division, said “extensive stock trading activity in industries that Price and Collins oversee as congressmen, and unusually good timing and financial benefits of those stock trades, raise red flags about the potential use of insider information.”

Price isn’t the only one of Trump’s Cabinet picks that Senate Democrats have targeted for extra scrutiny. Calling seven other Trump picks “troublesome,” Schumer announced this week that Democrats plan to push for more time to hold hearings.

“I would like to succeed in negotiating something where we get full and fair hearings – we’re not trying to be dilatory – and hear what these nominees have to say,” Schumer said. “There are so many issues about so many of them that to rush them through would be a disservice to the American people.”

Confirmation hearings are scheduled to begin for Trump’s cabinet picks next week, with several already slated for Jan. 11.

By Sophia Tesfaye

Sophia Tesfaye is Salon's senior editor for news and politics, and resides in Washington, D.C. You can find her on Twitter at @SophiaTesfaye.

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Conflict Of Interest Donald Trump Senate Democrats Tom Price Trump's Cabinet