Outcome: Successfully Withdrawn. The company is now providing some of the highest level of lobbying spending transparency in the pharmaceutical industry.
Whereas, corporate lobbying exposes our company to risks that could affect the company’s stated goals, objectives, and ultimately shareholder value.
Whereas, we rely on information provided by our company to evaluate goals and objectives, and we, therefore, have a strong interest in full disclosure of our company’s lobbying to assess whether it’s lobbying is consistent with its expressed goals and in the best interests of shareholders and long-term value.
Resolved, the shareholders of Endo Pharmaceuticals Holdings Inc. (“Endo”) request the Board authorize the preparation of a report, updated annually, disclosing:
- Company policy and procedures governing lobbying, both direct and indirect, and grassroots lobbying communications.
- Payments by Endo used for (a) direct or indirect lobbying or (b) grassroots lobbying communications, in each case including the amount of the payment and the recipient.
- Endo’s membership in and payments to any tax-exempt organization that writes and endorses model legislation.
- Description of the decision making process and oversight by management and the Board for making payments described in section 2 above.
For purposes of this proposal, a “grassroots lobbying communication” is a communication directed to the general public that (a) refers to specific legislation or regulation, (b) reflects a view on the legislation or regulation and (c) encourages the recipient of the communication to take action with respect to the legislation or regulation. “Indirect lobbying” is lobbying engaged in by a trade association or other organization of which Endo is a member.
Both “direct and indirect lobbying” and “grassroots lobbying communications” include efforts at local, state and federal levels.
The report shall be presented to the Audit Committee or other relevant oversight committees of the Board and posted on Endo’s website.
As shareholders, we encourage transparency and accountability in the use of staff time and corporate funds to influence legislation and regulation both directly and indirectly. We believe such disclosure is in shareholders’ best interests. Endo does not disclose trade association memberships, payments or the portions used for lobbying on its website. Absent a system of accountability, company assets could be used for objectives contrary to Endo’s long-term interests.
Endo spent approximately $4.3 million in 2010 and 2011 on direct federal lobbying activities, according to Senate disclosure reports. These figures may not include grassroots lobbying to directly influence legislation by mobilizing public support or opposition and do not include lobbying expenditures to influence legislation in states that do not require disclosure. And Endo does not disclose membership in or contributions to tax-exempt organizations that write and endorse model legislation, such as serving on a task force of the American Legislative Exchange Council.
Furthermore, these figures do not include state level lobbying expenditures. According to the National Institute on Money in State Politics, Endo lobbied in seven states in 2010 and 2011. Endo is also listed as a member of the Pharmaceutical Research and Manufacturers of America which spent over $40 million on lobbying in 2010 and 2011.