The Democratic and Republican congressional campaign committees are signaling that super PACs and other independent expenditure groups should make the pharmaceutical industry an issue in New Jersey’s 7th district — a potentially treacherous strategy in a region where drug companies employ nearly 20,000 people.
The Democratic Congressional Campaign Committee wants outside groups to attack two-term Rep. Tom Kean Jr. (R-Westfield) over pharmaceutical stock held in family investment accounts and his long record of defending the industry.
The National Republican Congressional Committee is countering with its own game plan: spotlight Democratic nominee Rebecca Bennett’s former employment at Johnson & Johnson and her now-disappeared investments in Johnson & Johnson, AbbVie, Eli Lilly and Merck.
The result could be millions of dollars in advertisements accusing each candidate of profiting from pharmaceutical companies accused of raising prescription prices — while those same companies provide thousands of high-paying jobs and spend approximately $650 million annually with vendors based in the district.
It is a political minefield for both candidates.
Federal law prohibits campaigns from privately coordinating with super PACs and other independent expenditure organizations. But campaigns and party committees may publish research, footage and preferred messages online where outside groups are free to find and use them.
Those public messaging guides are commonly referred to as red boxing.
The DCCC’s current research highlights three Johnson & Johnson holdings in Kean family investment accounts valued at between $215,003 and $550,000. When Merck shares are included, the committee calculates that Kean’s family owned between $266,005 and $665,000 in pharmaceutical stock.
Democrats want outside groups to connect those investments with Kean’s votes on prescription-drug policy, health care and corporate taxes. The intended message is that Kean defended an industry in which his family had a substantial financial interest.
But Kean has never concealed his support for New Jersey’s pharmaceutical sector.
During his 2020 congressional campaign, Kean attacked H.R. 3, a Democratic bill that would have allowed Medicare to negotiate prices for certain prescription drugs.
Kean said the legislation would “literally get rid of the biotech industry and the pharma industry in New Jersey.”
He argued that the proposal jeopardized 58,000 jobs statewide and would damage pharmaceutical research, patents and innovation.
The quote appears in the DCCC’s own 2022 opposition-research book on Kean. Democrats included it to portray Kean as opposing lower prescription-drug prices. Republicans can use the same statement to present him as protecting one of New Jersey’s most important industries.
The DCCC also reaches back to Kean’s tenure in the State Senate, noting his 2003 vote against an $11 million appropriation for the Pharmaceutical Assistance to the Aged and Disabled program, which helps eligible seniors and people with disabilities pay for prescriptions.
(Contributions from the pharmaceutical industry to his campaigns for the state legislature are no longer readily available to the public, after the New Jersey Election Law Enforcement Commission pulled them down from their website.)
The committee also cites a House committee vote against a Democratic amendment that would have capped out-of-pocket insulin costs for people with private insurance.
The DCCC argues that Kean’s public positions, campaign contributions and family investments show a pattern of placing pharmaceutical companies ahead of consumers.
But Bennett’s record creates an obvious opening for Republicans.
Bennett worked for Johnson & Johnson – one of the companies the DCCC is complaining about — after leaving active-duty military service and beginning a career in the health care industry. Her congressional financial disclosure showed that she owned between $1,001 and $15,000 in Johnson & Johnson stock.
She reported similarly valued investments in AbbVie, Eli Lilly and Merck.
The NRCC is directing Republican super PACs and independent expenditure groups toward those holdings to undermine Democratic attacks on Kean. Republicans argue that Bennett worked for and invested in the same industry Democrats now accuse Kean of improperly protecting.
They are also expected to highlight controversies involving each company in Bennett’s portfolio.
Many pharmaceutical companies, like those where Bennett was a minuscule shareholder, face allegations that they charged too much for life-saving drugs to make their executives rich. Democrats hammered former Celgene CEO Bob Hugin over this issue when he spent over $40 million of his own money trying to unseat U.S. Senator Bob Menendez in 2018.
Her campaign says she no longer trades individual stocks, supports barring members of Congress from doing so, and does not accept corporate PAC contributions.
Her disclosures establish that she owned pharmaceutical shares at the start of her candidacy, but they do not reveal exactly how much she gained or lost. Federal disclosure forms report holdings in broad value ranges and generally do not include the purchase prices needed to calculate profits.
Bennett’s divestment gives Democrats an answer to the NRCC: she sold the shares and would require members of Congress to follow her example.
Kean has his own response.
Last month, he voted for the Stop Insider Trading Act, which passed the House by a 232-198 vote. The measure would prohibit members of Congress, their spouses and dependent children from purchasing individual publicly traded stocks.
“I believe Members of Congress should serve the public — not profit from public office,” Kean said before the vote.
The bill would not force lawmakers to sell individual stocks they already own, and members could continue selling existing holdings after providing advance public notice. Democrats called it weaker than a competing proposal requiring lawmakers to divest their portfolios, but Kean’s vote nevertheless allows him to say he supported legislation ending new individual stock purchases by members of Congress and their immediate families.
Kean also says his assets are already managed independently and that he does not direct, influence, or participate in investment decisions.
That distinction is important because the DCCC and Bennett have falsely accused Kean of personally trading stocks while he was hospitalized for treatment of depression earlier this year.
Kean’s disclosure reports show that transactions occurred in accounts reported by him. They do not establish that Kean personally ordered the purchases or sales, which independent investment professionals handled without his participation, prior knowledge or direction.
The pharmaceutical argument is more complicated than either party’s red box suggests.
Kean’s family held far more pharmaceutical stock than Bennett did, and his political record includes an aggressive defense of the industry. But he voted last month to prohibit members of Congress and their families from making new purchases of individual stocks.
Bennett worked for Johnson & Johnson and invested in several pharmaceutical companies that have faced serious criticism over their pricing practices. But she has sold her individual shares and supports a more comprehensive prohibition on congressional stock ownership and trading.
The danger is that an outside group may strip away those distinctions.
“Not understanding the local conditions can cost votes, “said Micah Rasmussen, the director of the Rebovich Institute of New jersey Politics at Rider University. “Linking an opponent to big pharma might be a smart play in many districts around the country, but in NJ-7, it screams not knowing the district and one of its major industries.”
A Democratic super PAC could flood the New York television market with advertisements accusing Kean of protecting drug companies to increase the value of his family portfolio. A Republican group could answer with ads portraying Bennett as a former pharmaceutical executive who profited from companies accused of exploiting patients – as Democrats did to Hugin.
Either attack could backfire.
Pharmaceutical companies employ nearly 20,000 people in the 7th district and spend approximately $650 million annually with local vendors, according to We Work for Health, a pharma-funded advocacy group. The industry’s reach extends well beyond corporate executives to scientists, laboratory technicians, manufacturing workers, contractors, suppliers and retirees.
Kean’s risk is that pharmaceutical investments reinforce Democratic claims that his public positions and private financial interests overlap.
Bennett’s risk is different: an industry she worked in and invested in could conclude that Democrats are using her candidacy to vilify the companies and employees who helped build her health care career.