The Senate Finance Committee's health proposal released on Wednesday is missing key provisions that would have put the pharmaceutical industry on the defense.

The proposal doesn't include giving the federal government the authority to negotiate Medicare drug prices, one of President Barack Obama's campaign promises, or force the drug companies to pay billions of dollars in rebates for people who are eligible for both Medicare and Medicaid.

The bill does include a proposal to create a government-run board that would compare the effectiveness of medicines, but their cost wouldn't be a factor. The pharmaceutical industry has long said it would be unfair for the government to consider the costs of medicines when determining which drugs it would subsidize.

The Pharmaceutical Research and Manufacturers of America, or PhRMA, the main lobby for the brand-name drug makers, said it is reviewing the proposal and couldn't provide its thoughts on the proposal at this time.

Ken Johnson, a senior vice president at PhRMA, noted that the pharmaceutical industry has committed to helping the federal government save $80 billion over 10 years. The commitment will be met in several ways, including by giving certain Medicare patients their drugs at half cost.

He said the industry's commitment is "unprecedented" and anything more would force companies to cut jobs and end up "driving critically-important research and development overseas."

Pharmaceutical companies, including Wyeth (WYE), referred questions to PhRMA, while others declined to comment.

Many expected these provisions to be missing from the Senate proposal as Sen. Max Baucus, D-Mont., chair of the Senate Finance Committee, had supported a deal the industry struck with the White House in June. Under that deal, the pharmaceutical industry agreed to concessions of $80 billion over 10 years. The White House reportedly agreed that it wouldn't support giving the government the power to negotiate Medicare drug prices and collect additional Medicare rebates.

Proposals in the House, however, include many of these provisions.

"They fare better under the Senate" proposal, said Bonnie Washington, a vice president at Avalere Health LLC, a health-care advisory company, and a former official in the Center for Medicare and Medicaid Services in the Clinton administration. She says ensuring the government doesn't get the power to negotiate drug prices under Medicare is extremely important to the industry.

Still, not everything in the proposed bill favors industry. The draft includes imposing annual excise taxes of several billion dollars on drug makers.

The proposal also includes boosting the amount of rebates the industry has to pay the government for prescription and generic drugs offered to Medicaid patients.

Kathleen Jaeger, president of the Generic Pharmaceutical Association, the main lobby for generic-drug makers, said in a statement that rebates on generic drugs would also increase drug costs for patients. Instead of raising rebate rates, Congress should work to increase generic drug utilization, she said. The bill would increase rebate rates, the amount companies have to pay in rebates for drugs, to 13% from 11% for generic drugs. The rate for brand-name drugs would be boosted to 23.1% from 15.1%.

The bill would also require companies to report annually all payments larger than $10 to physicians and hospitals as part of a broader effort in Congress to ensure pharmaceutical money isn't influencing doctors' prescribing habits. Any company that doesn't report the payments could face fines of up to $1 million a year.

-By Jared A. Favole, Dow Jones Newswires; 202.862.9207; jared.favole@dowjones.com

(Alicia Mundy contributed to this article.)