The Democrats’ decisive victory in Tuesday’s mid-term election put them in control of the House, but it is widely seen as bad news for the pharmaceutical industry. Dire predictions of drug price controls have many in big pharma concerned. Pharma should be worried—especially if it sticks to the old game plan.

But the Democrats’ moves against the drug industry are not likely to be as drastic as warnings suggest. So long out of power, the Democrats don’t want to revert to their old ways and to be seen as the anti-business party. They have a chance to take the middle road where they can be perceived as both pro-business and pro-consumer...

Democrats will want to recast their old image of anti-business regulators ahead of the presidential election in two years. The reasonable center is usually the best course in presidential politics.

And a number of newly elected Democratic Congressmen are more conservative than Nancy Pelosi, anticipated to be House Speaker. They may help bring the party to the center. A party in the middle doesn’t usually go to extremes.

And even if Democrats take narrow control of the Senate, it will still be a divided government that is less likely to take punitive action against a particular industry. Democrats will have their hands full, launching Congressional hearings about the war in Iraq or taking on other out-of-favor industries such as Big Oil. While Big Pharma has been vilified in the mainstream press, Big Oil’s huge profits are an easier target. Pharma also has the advantage over Big Oil because it is an industry that provides hope with life-saving treatments.

Certainly, Pharma will be on the Democrats’ hit list, but the industry has a chance to make some compromises that would stop short of dreaded price controls. Of course, the Democrats will want some symbolic victory on drug prices to take to the voters in 2008.

If Pharma doesn’t find a way to work well with Congress this year, and if a Democrat wins the White House in two years, then all bets are off.

Pharma, ironically, may want to turn to a big stem cell research supporter such as actor Michael J. Fox, who successfully helped a Missouri Democrat win Tuesday night with his backing of the issue. The Parkinson disease sufferer and his foundation know well how difficult and expensive research for a new drug treatment is. Wiping out drug company profits doesn’t help research efforts. While industry has to back off its high estimates of how much it costs to develop a new drug, it remains a very expensive and risky enterprise.

Democratic supporters of stem cell research can be pharma industry allies—as long as all sides take the middle road and don’t get too greedy.