Monday, March 17, 2008

Oh How I Dislike Big Pharma

A recent article in The Washington Post explains why the Democrats have not been moving on their campaign promises to renegotiate parts of the Medicare prescription drug plan - aka pharmaceutical industry welfare - along with opening up our northern border to enable free trade in lower priced drugs from Canada. In short, The Washington Post found that the biggest stumbling block in Democratic efforts to fix our protectionist drug industry are Democrats themselves. This is no surprise in light of the fact that big pharma has drastically expanded their lobbying budget while making sure to dole it out evenly between both Democrats and Republicans. But the pharmaceutical industry is not just working on ways to stall today's meek protestations from the Democrats and a few Republicans; no, they have their future to think about. That is why they are pulling out all the stops in their drive to convince the American public that the current drug industry setup is the best. They are doing this, as the Post reports, by buying air-time in major media markets for half-hour talk-shows, where participants, including former Bush press secretary and fox news commentator Tony Snow, extoll the wonder making power of big pharma drugs, creating programs to provide low-income families with the drugs they need but can't afford, while making sure the media knows about the good deeds, and purchasing the lobbying services of former aids to big name Democrats.
Well, so what? If anything, this proves that the pharmaceutical industry understands that their old way of doing business will not work. They understand that their drug prices are too high for too many people, and so they are fixing this by providing discounted drugs. Doesn't all this show that big pharma has gotten the point, that they are mending their ways?

All this does prove that they realize that in order to keep doing what they are doing they need to change the ways they do business... on their own terms. There in lies the problem. The pharmaceutical industry has a sweet deal going: They have money, power, lots of well-connected friends, and high profits - although profits streams are waning due to faulty drugs, a lack of new drug prospects, and lawsuits. They have been doing very good up until quite recently, and so for years and years they have tried to hide the one dirty-little-secret that could bring their whole industry crashing down: profit-driven drug development is the most ineffective way to create innovative and cheap drugs. It is not only ineffective, it is rife with conflicts of interest that must be constantly regulated and mitigated, with mixed results.
To get a taste of how ineffective the current system is consider this: The pharmaceutical industry spent around $41.1 billion dollars on drug research in 2004, and yet the U.S. spent $220 billion dollars on drugs. The difference between the two are accounted for mostly by the cost of marketing and profits.
The drug industry is able to sell drugs for as much as they do because the government protects their profits through patent protections on their drugs. Patents are all fine and good when society has an interest in energizing research and development, but it hardly is the most effective way to spur innovation in drug creation. Why? Because the government is already funding huge amounts of research very effectively, through public universities, as well as the National Institute of Health (NIH), who's $30 billion a year budget is at the present moment a large subsidy for the pharmaceutical industry. What makes the current system even more ridiculous is the fact that much of that $41.1 billion research budget of big pharma is being spent on developing "copycat" drugs such as Cialis and Levitra, which cost around 90% more to develop than the original, Viagra, to treat a very profitable, if not life threatening, ailment. If the government were funding research there would be no copycat drug creation, because it is wasteful in an industry that has more important problems to focus on. Public funded drug research would allow most drugs to be sold at prices near those of generic drugs like aspirin, because, in a free market, drugs do not cost $6,000 to manufacture. I recommend reading this book to learn more about this and other corporate welfare.
Lastly, there is the ethical issues of for-profit drug production. In our current system there is a dangerous relationship between drug makers and drug consumers: their interests are divergent. Consumers are looking for a drug that will help them heal. They want to take a drug only for as long as is needed for them to recover from illness. They want the most impartial and informed advice as to what drug they should take. The drug industry, on the other hand, is looking to sell the most drugs possible at the highest price possible, to realize profit gains for their investors. To do this they must market their drugs effectively, not just to doctors, but also to patients who did not go through seven years of medical school. They apply the tried and true marketing techniques of a typical salesman, except in their case they are not selling appliances but products that often have life or death consequences, or at least potential to do harm in the short or long-term. Without constant regulation they would invariably be like the common drug dealer, with societal effects just as detestable. Because they are the only game in town, they have overwhelming power to make a money driven political system work for them to reach their profit objectives.
As a recent article in the New York Times shows, drug companies work first and foremost to drive sales, regardless of whether it benefits society. In this most recent example of drug company malfeasance reported by the NYT, the chief operating officer, soon to be CEO, of Eli Lilly, John C. Lechleiter, discussed in an e-mail possible "off-label" uses (uses not approved by the FDA) for a drug, Zyprexa, that is now the center of investigation and lawsuits. In this e-mail from 2003, Mr. Lechleiter seems to have been encouraging the use of this high power schizophrenia drug, which is now known to often cause obesity and high-cholesterol, on children and adolescents. He said, “The fact we are now talking to child psychs and peds and others about Strattera means that we must seize the opportunity to expand our work with Zyprexa in this same child-adolescent population”. Kids on antipsychotics, great one Mr. Lechleiter.
How many cases such as this does it take until we fix this mess; how much money must be wasted on big CEO paychecks and profits? How many deaths for lack of medicine until we wise up; how many deaths because of the misuse of medicine before we pull the wool from our eyes? Don't buy the lies propagated by big pharma. Their interests are different than yours and mine.

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