What to do with your feelings?

August 4th, 2007 by Ben Goldacre in bad science | 59 Comments »

This week Alan Johnson announced that he wasn’t going to stick by the Pharmaceutical Price Regulation Scheme that lines the pockets of the drugs industry. You only have to say those words to trigger to my favourite 3 minute dinner party package: how evil is big pharma?

In the UK, the pharmaceutical trade is the third most profitable activity after finance and – this will surprise you if you live here – tourism. We spend £7 billion a year on pharmaceutical drugs, and 80% of that goes on patented drugs, that is, medicines which were released in the last 10 years. In 2002, the 10 US drug companies on the Fortune 500 list had combined international sales of $217 billion, which is a lot of money. To people like you and me, that much money is probably just evil on its own terms.

They spent only 14% of that money on R&D, while spending 31% on marketing and administration. They are very careful not to let anyone see how much goes separately on marketing and on administration, because the reality is, they spend twice as much on marketing as they do on developing new drugs, and this is embarrassing for them to admit. Whenever you hear the drug companies explaining why they have to charge so much for their products – perhaps as they are denying their lifesaving AIDS drugs to the 20 million HIV positive people in Africa – the plea is that they need money to develop new drugs. That’s not true if they spend twice as much on marketing as they do on research and development. This unhappy collision of facts makes them look very evil indeed.

They also charge this money in slightly evil ways. When your drug comes out, you have ten years “on patent” as the only person who is allowed to make it. Loratadine is an effective antihistamine drug that does not cause the unpleasant antihistamine side effect of drowsiness. It was a pretty unique molecule for a while, and highly in demand. Before the patent ran out, the price of this drug, by Schering-Plough, was raised 13 times in the US in just 5 years, increasing by over 50%. This is not a price rise in keeping with inflation. This is evil.

But it’s also an industry in trouble. The golden age of medicine has creaked to a halt, and and the number of new drugs, or “new molecular entities” being registered has dwindled from 50 a year in the 1990s to about 20 now. At the same time, the number of “me-too” drugs has risen, making up to half of all new drugs.

Me-too drugs are an inevitable function of research driven by a market: they are rough copies of drugs that already exist, made by another company, but they are different enough that a manufacturer can claim its own patent. They take huge effort to produce, and need to be tested and trialled and refined and marketed just like a new drug; but for all that effort they generally don’t represent a significant breakthrough in human health. They are a merely a breakthrough in making money. Again, you have to admit, that is reasonably evil.

But what really interests me is what we do with our feelings about this evil: because it is entirely predictable, market driven venality, which can be found in every market sector, but we find it uniquely distressing when we are sick and needing healthcare. Somewhere, deep down, it’s as upsetting as thinking our parents were paid hard cash on a per diem sliding scale with performance bonuses to love and look after us.

This moral discomfort and resentment leaks out in delusional anti-MMR beliefs, or bizarre acts of faith in the vitamin pill industry, as acts of misguided and wasteful political rebellion. Why? Because everybody is a socialist when it comes to healthcare, but nobody knows what to do with those feelings any more.


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59 Responses



  1. DavidGSFarmer said,

    August 4, 2007 at 3:05 am

    It’s true that the backlash to big pharma takes the form of support for herbal/homeopathic remedies because they seem to fit into the overall conspiracy: big pharma only care about making money and ‘natural’ remedies are suppressed because they can be grown and are therefore not economically viable.

    Such responses are surely a result of the lack of understanding of science on the part of the public and the media.

    I’m sure this comment only echoes things you’ve said in the past, Ben but for the record, you’ve found an ally in me in the past year.

  2. Handles said,

    August 4, 2007 at 6:47 am

    New technology is always expensive when it first comes out. My crappy digital camera cost a fortune when I bought it. How much do “big electronica” spend on R&D vs marketing? What would be an acceptable ratio for pharma company spending?

    Pharmaceuticals research is a fool’s game. In my own field (cancer drugs) it is said that 95% of drugs fail to reach the market. My employers (Very Small Pharma Ltd.) did not have the money to conduct our first Phase 3 trial, and had to rely on investors willing to risk the ridiculous odds of failure. The only way to attract investors like this is to offer them a very high return if their gamble pays off. Large potential profits are a necessary evil for small pharma. Should this situation change as we grow, and the money we are risking becomes our own, rather than someone elses?

  3. Gimpy said,

    August 4, 2007 at 7:55 am

    I also meant to add that the really sneaky thing ‘evil big pharma’ do it to use research usually funded mainly by the taxpayer and charitable donations in universities to further their evil schemes with minimal pay outs to the institutions or the bench slaves doing the basic research.

  4. Azimov said,

    August 4, 2007 at 9:50 am

    I had no idea about marketing, my dad works for a large drug company and I didn’t know that the gap was this large, perhaps the government would do better researching and producing its own drugs.

    The problem is that a 10 year patent really isn’t that long in a capitalist market, the drug companies only get this time to see a profit, which is all they care about. I’m not proposing a solution , from the drug companies point of view and it doesn’t make it acceptable, but that’s the issue.

    Maybe if they stopped sending those drug reps round to doctors getting them to use their ‘new super drugs!’ they wouldn’t need to charge so much in the first place.

  5. evidencebasedeating said,

    August 4, 2007 at 10:05 am

    Bad, bad pharma
    and nice, benign, friendly little vitamin and mineral manufacturers, toiling away for our ‘better health’

    – In a self-regulated UK industry worth a lowly £340 million a year. www.mbdltd.co.uk/Press-Release/Vitamins-Minerals-Supplements.htm. Thank goodness VMS were cleverly classified years ago as food supplements, not medicine. So no need to spend ANY money on research, leaving more for that essential marketing and advertising tothe worried well, guaranteed to protect profit margins.

    Bit of a bummer for the ‘high dose’ marketeers, though.
    www.foodstandards.gov.uk/science/surveillance/fsisbranch2006/fsis1206
    The days of the plaintive (or should that be plaintiff?) pleas of ‘we woz only doing it for the people’, and ‘we can’t afford the research as we’re a small company worth £30m of(mega)peanuts’ is sounding a bit, well, capitalist.

    No other reason, though, given that the plethora of publicly funded research (cos they have no money, only shareholders)is – bar folic acid – showing uniformly and consistently the inherent health risks of high dose supplements. The FSA has recognised it. Pity the DoH hasn’t. The profiteers continue whilst political intransigence rules..

  6. superburger said,

    August 4, 2007 at 10:25 am

    why do we expect large multinationals who sell chemicals to behave any different to large companies that sell cars?

    They have an absolute duty to their shareholders to maximise their profits by any legal means.

    Should come as no suprise that they act in this way.

    remember, your pension fund and bank probably invests heavily in these companies. And *you* would be mightily pissed off if your back pocket was hit because the drug companies started acting in a charitable manner.

    sad state of affairs though.

  7. Lanky said,

    August 4, 2007 at 11:17 am

    The reason Big Pharma spend more on marketing than on R&D is that marketing has a better return than R&D. If GlaxoSmithKline is spending £30million to market its latest anti-allergy drug, and AstraZenica only spends £1million on its own version, then GSW will sell far more of its product than AZ, regardless of which is more effective. So AZ have to spend as much as GSW to stay in the game. They don’t really have any choice in the matter – it’s like an arms race; because the competition is going to spend a fortune on marketing, you have to spend a fortune, so they have to spend a fortune, and so on. The only way to bring down the amount they spend would be to legislate a maximum amount any company could spend marketing which I expect would be a legislative minefield.

  8. Tim Worstall said,

    August 4, 2007 at 11:24 am

    You’re reading Marcia Angell on this? Eeek!
    Her idea is that drug development should be done by Govts, not private companies. Worked so well with cars, steel, electricity, etc etc, didn’t it? A committee of bureaucrats decides where the R&D money goes. Which diseases get investigated.
    Lovely, eh?
    Put it another way. Do you really want the people who brought you the Millenium Dome (roughly the same cost, BTW, as two new drugs) deciding which diseases get new treatments developed for them? Do you really think that they’d be better at finding ones that work?

  9. Tim Worstall said,

    August 4, 2007 at 11:50 am

    That’s a relief.

  10. Gimpy said,

    August 4, 2007 at 12:56 pm

    Tim Worstall: You can’t rely on market forces to decide which diseases get investigated either. As anyone working in tropical disease research will testify. Market forces drive companies to invest in areas where the return on their money is greatest and its not the developing world. Cancer research receives an astonishing amount of funding yet I imagine if you live in Africa the chances of you dying of something else are considerably higher than in Europe (of course I have no figures for this just yet but it sounds true).

  11. jodyaberdein said,

    August 4, 2007 at 1:06 pm

    Etienne G krug, Lancet 2004, 364, 1563, gives a good breakdown of global mortality by cause. Very enlightening.

  12. Gimpy said,

    August 4, 2007 at 2:02 pm

    17. I’ve stuck the relevant figure from that paper up here for those of you without secret academic powers……….
    tinyurl.com/2dfpuh

  13. thescientist said,

    August 4, 2007 at 5:38 pm

    could the patents either be lengthened or removed?

    if there are no patents then all of the companies can access the info and make the best drug at the best price.

    or, if the patent is say 70 years then they have a long time to make their money so no giant charges in the short term. would have to stop the problem of “me-too” drugs though.

    may be a bit simplistic. could it work?

  14. woodpecker said,

    August 4, 2007 at 6:17 pm

    Please get your basic facts right Ben before going on about the supposed evils of patented drugs. Patents throughout the world last for 20 years from filing, not 10 as you suggest. The US has a few little intricacies of its own which can change this, but let’s not go there. There is also the added complication of Supplementary Protection Certificates, which can extend the lifetime of some drugs, but that is another ‘evil’ to be addressed.

  15. woodpecker said,

    August 4, 2007 at 6:58 pm

    Actually Ben is wrong. There are too many suppositions needed for the simple statement in the article to be factually correct. A few “usually”s might have done it, but they weren’t there, which suggests ignorance to me and is misleading for others. Since this column/blog often condemns others for being misleading or downright wrong, it is of crucial importance that the facts are correct as far as they can be.

  16. barnics said,

    August 4, 2007 at 7:34 pm

    Woodpecker, your Dinner Party speeches must be terribly terribly pedantic.

  17. coracle said,

    August 4, 2007 at 10:06 pm

    Quick one for wibbly-wobbly, I don’t think me-toos have anything to do with the rate of registrations for NCEs. I think there are other factors that have a greater effect than me-toos, such as a decreased tolerance of adverse effects and the low-hanging fruits having been hit already.

  18. mch said,

    August 4, 2007 at 10:18 pm

    Ben I’m with you that healthcare is viewed differently than other markets because people are hurt and dying and we don’t like to see it.

    But…

    Healthcare supply requires huge complex setups – wages to get the right people, training, buildings, materials, equipment, long term investment & debt management & equity, risks & insurance, etc – and the market is the least inefficient way of getting all that sorted out. Including the wastage you’ve commented on.

    If we dislike seeing people denied the opportunity for healthcare, then let’s fix that; we as a society can pick up the tab. Put our money where our morals are. Duty not rights. etc, etc.

  19. wilsonj said,

    August 5, 2007 at 9:28 am

    MCH,

    I cannot agree that the market is the least inefficient way of sorting out health care.

    The US/UK figures for health spending are 2005 are:

    US 15.3% of GDP
    UK 8.3% of GDP

    US $6401 per capita
    UK $2724 per capita

    life expectancy figures are
    US 77.8 years
    UK 79 years

    The figures are from the OECD www.oecd.org/health/healthdata

    There is also information on how health care is funded (public sector, insurance etc). There are no doubt entertaining arguments to be had on risk factors and public sector funding of market suppliers. However, the US seems to be spending much more per head on a predominantly market run system with no benefit in terms of longevity.

  20. mickjames said,

    August 5, 2007 at 9:30 am

    Do “me-too” drugs suppress innovation? I thought Ben’s point was that they were a commercial response to the lack of “new molecular entities” to discover?

    It may be arguable that an individual drug or drugs has diverted research attention while offering little benefit: it’s a big leap from that to the assertion that all new treatments outside the “breakthrough” category are worthless.

    What is unarguable, surely, is that “me-too” drugs lower prices.

    See here for refs:

    content.healthaffairs.org/cgi/content/full/24/3/884.

  21. mch said,

    August 5, 2007 at 10:15 am

    wilsonj, comparing average spend with average longevity ignores too many other factors.

    Switzerland, for example, spends much less than the US (approx $3700 per person per year) on a market-driven healthcare system that reaches a much broader range of the population, and they live longer (80.6 yrs). But that might be down to genetics, cultural differences and every-day living standards rather than healthcare.

    Given the size of the spends and all the other factors, I’m not sure whether the lost efficiencies in public healthcare – the NHS for example – are actually significant.

    My point really was that if we don’t like seeing ‘Something Bad’ then we should take it on ourselves to provide for it. Rather than find the apparent waste areas, ignore the efficient and innovative areas, and assume that fixing the former won’t ruin the latter.

  22. jodyaberdein said,

    August 5, 2007 at 11:52 am

    Regarding the best way to provide healthcare, this could be the subject of a blog in itself. None the less i’d suggest people have a look at what Wilkinson and Marmot have been saying for the last decade at least.

    An excellent but difficult to source book is ‘Unhealthy Societies’, Wilkinson RG, from Routledge, a close perusal of figures 3.1 and 5.2 should prove to you it isn’t absolute wealth that is the controlling factor above a certain threshold.

    American Journal of Public Health, Vol. 82, Issue 8 1082-1084,

    For those with the aforementioned special academic powers.

    Some of the market economies fare significantly worse than more socialist ones at a given GDP level, and it would seem the driver is inequality.

  23. RS said,

    August 5, 2007 at 12:15 pm

    I don’t really understand Tim Worstall’s aversion to governments deciding what diseases should be targetted for drug development – the pharmaceutical industry is notorious for distorted R&D investment (the whole reason for me-too drugs).

    His analogy with car manufacture pretty much highlights why it might be a good idea – cars are a consumer commodity – drugs are not, particularly in the UK and with the NHS.

  24. Pedantica said,

    August 5, 2007 at 1:08 pm

    Interestingly if Big Pharma is indeed evil it’s probably an evil that we are broadly complicit in rather than one we suffer from; we are a significant net exporter of Pharmaceuticals. I believe it’s the sector with the 2nd highest balance of trade surplus after that oil stuff.

    I had a rummage around for figures on the total tax revenue raised from the pharmaceuticals sector in the UK but couldn’t find any good stats. Nevertheless I’d guess it surpasses (arguably “funds”) the £7bn we spend on pharmaceuticals ourselves.

  25. Gimpy said,

    August 5, 2007 at 4:52 pm

    39. le carnar noir. “An independent, government funded, academic research capability must surely be one of the ways society can counter-balance the distortions of market-based drug R&D?”

    While I personally would welcome the government pumping oodles more money into universities I’m not sure that university research is the best place to challenge big pharma. Big Pharma has the benefit of being able to work towards definable profitable objectives in the form of new drugs. Basic research cannot be that specific. It involves the research of lots of little things which collectively increase our understanding of the world. It really is knowledge for knowledges sake with profit and financial incentive being a secondary (although not unimportant) issue. I earlier alluded to Big Pharma taking advantage of publicly funded publicly available research in the development of its products with little if any reward for the people behind the research. Perhaps there should be a requirement in law for Big Pharma to direct a percentage of its profits or income to a non strings attached pool of money given to universities.

  26. humber said,

    August 5, 2007 at 10:40 pm

    To echo Gimpy, do you have the source of the R&D/Marketing figures ?

  27. Robert Carnegie said,

    August 6, 2007 at 12:09 am

    I was puzzled by the ten years! It is twenty, isn’t it? I don’t think it needs to be changed just now. Drugs producers probably would like it to be forever.

    There are areas where government legislates fair dealing instead of letting the market do what it likes, and pricing and exclusivity of life-saving products looks like a good place to do that. (Patents aren’t that, particularly, they only protect innovation without forcing industry to use it for public good.) Imagine if they priced drugs according to how badly you needed them and how much you could afford.

  28. tomrees said,

    August 6, 2007 at 3:23 pm

    The reason pharma spends so much on marketing is that it provides a good return on investment. And it does that because doctors are just as susceptible to cheap marketing tricks as the rest of us. Selling a drug is not much different to selling a car.

    The only solution to this problem is to restrict the access of marketeers to prescribers and also to limit the options of prescribers (i.e. use of formularies, institutions like NICE).

    In other words, take treatment decisions out of the hands of doctors and put in the hands of centralised bureaucracies/government.

  29. Dr Aust said,

    August 6, 2007 at 5:05 pm

    In connection with tomrees’ last comment, I would say that (anecdotally – there may be hard evidence but I don’t know it) the prescribing of “brand name” drugs pushed by the pharma marketing people, rather than those which offer some kind of objective best bang for the buck, is generally thought to be far more marked in insurance-based medical systems than in “centralized and semi-rationed” systems like the NHS or Australia.

    By “insurance-based” I don’t just mean the US system here – German medics, who also work in an insurance-based system, have long been notorious for dishing out expensive brand-name drugs rather than the cheaper versions (and for sending punters for unnecessary investigations, but that’s another story). I think there may now be a kind of national formulary in Germany, but this would certainly have had to be pushed through over the objections of sectors of the German medical profession.

    Anyway, the general point is clear – Pharma pours cash into marketing because it sees it as being highly cost-effective in shifting the product.

    One of the current slightly-below-the-radar Pharma campaigns is to try and loosen the restrictions in Europe on direct-to-consumer marketing of prescription drugs. Watch TV in the States and you are bombarded with ads for (say) anti-ulcer drugs:

    “Got acid reflux? Ask your physician for Justlike-osec!”

    The point being that even if the doctors get more sceptical, the patients can still be persuaded. And as in most advertising, name recognition is key.

  30. Fin said,

    August 6, 2007 at 5:09 pm

    PS
    Sorry – forgot to declare. I work for big pharma.

  31. Arthur Dent said,

    August 6, 2007 at 8:22 pm

    Just a few comments:

    AstraZeneca is NOT sacking R&D staff, it is getting rid of very large numbers of people to reduce its cost base but these are mainly in manufacturing (more outsourcing, why build plant to make a product with less than 10 years life), sales and marketing and central operations.

    Patent life is indeed 20 years but useful patent life, i.e post launch, is usually less than 10 years

    Sales expenditure is a direct consequence of short patent life. Generic manufacturers spend very little on sales because they only make successful drugs that are already well known by doctors (they now walk off the shelf). At launch it is essential for the innovator to get sales volume up rapidly since there is little time to recoup costs and DTC is banned in all markets except the US.

    “Me too” drugs are neither useless nor valueless: firstly the first to market innovative drug is rarely the most effective and the best place to be is usually 2nd or 3rd. secondly not all drugs work in all patients or have the same side effects profile. If you are on long term drug therapy, e.g. for hypertension, your GP will almost certainly have tried you on a number of ‘me too’s before getting the optimum treatment.

    R&D undertaken by Governments; your having a laugh aren’t you. Big Pharma may no longer be as productive as it was but I challenge you to name a single valuable drug that has emerged from either the USSR or China.

    Note also that the major costs in bringing a drug to market are in the Development not in the Research. It is a phenomenally expensive and risky business. It now costs ca. $800m to take a drug from inception to launch. The success rate used to be very bad around 1 in 100 compounds starting into serious development ended up in the market, it is now much improved to about 2 in 100

  32. jodyaberdein said,

    August 6, 2007 at 8:51 pm

    Artemisinin

  33. Dr Aust said,

    August 6, 2007 at 9:38 pm

    Hmm

    All I can say, Arthur, is that my friends who work in R&D for AZ are the ones who told me about AZ’s “resizing”. And I didn’t say “sacking” – I said “shedding”. It may be by voluntary pay-off to get lost – as in my friends’ cases – but it is still shedding. And the policy of “outsourcing” R&D is what they tell me the R&D people in the company all believe.

    Talking of drugs, “Me too” drugs come in different shapes and sizes. I completely agree that the first (e.g.) statin is not necessarily the best statin there could ever be. If other companies want to make statins, that is their market risk to take. But equally, it is fairly understandable if NICE (or similar) wants to run a direct comparison on both efficacy and cost-effectiveness between the various drugs and then tell doctors to prescribe the most cost-effective unless there is really good evidence (from more than just the company’s own trials) that the pricier alternative is really “better indicated”.

    In my view it is not being overly cynical to say that if A.N.Other PharmaCo has spent £££ developing their own statin, they will always find a way to interpret their trial evidence to say it is “better” (at least for some patients, or on some grounds) than X.Y.Pharma’s statin. This will typically not involve a direct like vs like trial. The tricks (compare your drug at optimum dose with your competitor’s at sub-optimum dose, tricksy patient selection etc etc) are multiple and well-described. Or the “this is a better drug” line may be a pitched on something like “this one has a longer half life” without any head-to-head trials with the competitor compounds to show that the new drug actually improves patient outcomes.

    But like I say, bring the compounds on. Just don’t give us moral outrage when people don’t trust company literature to give the verdict on which drug works best. Hence the need for independent comparison studies, NICE, and the Drugs and Therapeutics Bulletin.

    And there are also much less defensible examples of “me too” than “newer drugs of the same class”. Perhaps the most obvious are when a single optical isomer is heavily marketed as a “new and better drug” once the racemic mixture, which the company had previously been happily and profitably selling under patent for a decade, runs out of patent life.

    Finally, concerning your and Fin’s comments on hypertension: if the new drug really is better, or really helps the patients comply with the treatment by avoiding detrimental side effects (e.g. angiotensin antagonists rather than ACE inhibitors to avoid hacking cough), then the new drug will get accepted and used. But conversely, it shouldn’t then be used as first-line on everyone simply because it is “new and shiny” and is being pushed hard as “so much better” by eager salesmen armed with copious glossy literature. Diuretics (cheap generic) have been shown by major face-off trials to be as good as a first-line treatment for many hypertensive patients as the new and much more expensive pills. That is why they are still in the guidelines.

  34. steve said,

    August 6, 2007 at 9:49 pm

    There are some ‘me too’ drugs that are useful and of value. For example ranitidine is superior to cimetidine because it is metabolised differently and does not have the same range of drug interactions. Acrivastine is superior to loratadine because it works faster, and captopril is probably the least useful of the ACE inhibitors because of it’s three times a day dosing.

    There are also some groups of drugs that are quite heterogenous. There are large differences between the cardioselectivity of beta blockers and their lipid solubility, which affects their side effects. The penicillins also have differing acid stability, spectra of activity and dosing schedules.

    However, there are some ‘me too’ drugs that are not useful and are a waste of money. For example levocetirizine, esomeprazole, escitalopram – compare to cetirizine, omeprazole and citalopram.

    Big pharma also have another trick up their sleeve. Just before the patent on their drug runs out they withdraw the dosage form that has been on the market and replace it with a new one. For example just before ramipril came off patent Aventis withdrew tritace capsules and introduced tritace tablets – meaning everyone would be switched over to tabs, and not always switched back to caps when the generic came out. This is quite sneaky and it is a pain in the backside getting all the prescriptions changed over.

  35. Arthur Dent said,

    August 6, 2007 at 10:17 pm

    Dr Aust your experience and mine differ, certainly there is outsourcing of some R&D but recruitment continues and I am not aware of significant sharp end losses in R&D.

    I work in Big Pharma and it does indulge in many of the practices alluded to to maintain its profitability. I just get brassed off by some of the automated responses that equate all Pharma companies as the evil monster in the corner.

    The industry is going to have to change as is the system in which it operates. The difficulty for all of us is in making the change. However, some of the solutions such as elimination of profit incentive, shortening patent life, getting Governments to pick winners will simply make the situation worse

  36. richard_p_auckland said,

    August 7, 2007 at 5:11 am

    I have shares in J&J (Big Pharma) and in Caterpillar (construction machinery).

    The digger firm has done *much* better over the last five years. Which possibly doesn’t say very much, but it does indicate that the pharma company isn’t a massively better investment than any other business.

    But would it be the correct ethical choice for me to sell the J&J and buy more digger company shares?

  37. jodyaberdein said,

    August 7, 2007 at 7:17 am

    Re: 55

    I’d suggest you ditch the digger shares. They do after all make the D9 as used by the IDF and US in Iraq. The Curch of England did anyhow. I once sent them a letter asking them what they thought of the use of their digger as a miltiary tool and they responded that they could not comment on how their products were used. My mate at the time had just bought a pair of CAT boots proudly emblazoned with ‘helping shape a better world’ or something equally trite.

    en.wikipedia.org/wiki/Caterpillar_D9

    Re: 54

    Still no response to artemisinin and derrivatives.

    In fact there is severe shortage of these powerful antimalarials, and several companies are making them. They were developed in China, and many Chinese companies are making single agent products and risking the rapid development of resistance. In fact some estimates would suggest most of the artemisinin bought on the open market is fake. None the less the drug is Chinese developed. In addition the fakery and single use are nice facets of what markets can result in when left unfettered.

    Actually the choice of artemisinin combination drugs as the next big hope was the product of a massive bureaucracy: the WHO.

    I wonder if anyone would care to comment on the history of rotavirus vaccination with respect to the global mortality chart I posted up at 17?

    Lastly, are people really saying that the only way as humans we can motivate ourselves to do something as noble as investing something that saves lives, sometimes in their millions, is because we might get paid more money for it than if we did something else? Perhaps if you need that as motivation you shouldn’t be in the game at all. I always hope that when people like Garnier read about Jonas Salk they feel a slight twinge of guilt.

  38. mickjames said,

    August 7, 2007 at 9:01 am

    Jodyaberdein: so presumably if your mate with the Caterpillar boots uses them to kick someone’s head in, that would be Caterpillar’s fault as well?

  39. prosthesis said,

    August 7, 2007 at 10:13 am

    Dr Aust:
    “And there are also much less defensible examples of “me too” than “newer drugs of the same class”. Perhaps the most obvious are when a single optical isomer is heavily marketed as a “new and better drug” once the racemic mixture, which the company had previously been happily and profitably selling under patent for a decade, runs out of patent life.”

    Hmm, wonder what you could be talking about? wouldn’t be a well known PPI by any chance :-)

  40. woodchopper said,

    August 7, 2007 at 11:54 am

    Mick James:

    If jodyaberdein’mate walked into Caterpillar and said ‘I plan to kick in someone’s head – which boots do you recomend?’ then Caterpillar would be complicit in the crime.

    Similarly, if jodyaberdein’s mate was a famous and world renoun headkickeriner then one could make a good case that Caterpillar were also complicit in the crime.

    Life isn’t as simple as you like to think it is.

  41. ayupmeduck said,

    August 7, 2007 at 11:59 am

    Dunno about the R&D rates, and frankly can’t be bothered to look ‘em up – though this might possibly be of interest:

    www.cbo.gov/ftpdocs/76xx/doc7615/10-02-DrugR-D.pdf

    The reason I’m not bothered is because I don’t see big pharma as a special case. The huge marketing budgets that we see are a fact of our imperfect capitalist economy where marketing/advertising is not information, but something close to propaganda. In a perfect capitalist economy with perfect information, something like that envisioned by Adam Smith, such marketing would be pointless.

    I don’t see big pharma as any worse in this respect than, for example, Nike. Nike spend virtually nothing on their R&D, they buy the outsourced product for a few dollars and sell at 20x the cost. By far the biggest cost that Nike have is the cost of marketing the idea that their product is somehow worth 20x the actual cost and it’s “cool” to buy something made under labour conditions which we personally would never except. Yet you’ll find many brand wearing consumers ranting on about evil big harma.

    The sad fact is that everybody, including big pharma, sees that this works and as other commentators have pointed out, marketing promises better ROI than R&D. This is especially true when your competition starts pushing money into marketing and you then have to play the game of “marketing as mutual cancellation”.

    Naomi Klien’s “No Logo” was an interesting, but flawed, take on on the whole idea of “useless” marketing – can’t remember if she has a chapter on any pharma companies though, will check later.

  42. Dr Aust said,

    August 7, 2007 at 1:42 pm

    ayup

    Agree that in business terms Pharma operates much as other businesses / corporations – but of course this bring us back full circle to BG’s original point: when it comes to health, and medicines, most people (at least outside the USA) are instinctive socialists. or at least utilitarians. There is thus an uneasy tension between the model people have in their heads of what ought to happen, and what really does.

  43. stevejones123 said,

    August 7, 2007 at 2:20 pm

    Much of pharma’s ‘marketing’ is in fact simply bribing doctors

  44. Fin said,

    August 7, 2007 at 3:38 pm

    Re: stevejones123 said (above).

    Good use of ‘in fact’ – thank you for sharing this insight.

  45. eva said,

    August 7, 2007 at 7:08 pm

    hmm good question, what to do with the feelings? Well is it time we stopped moaning about the pharma system and did something practical like lobby the government so that drug invention is not such a money oriented business. Like you said, pharma is big bucks to governments. Big Bucks means government not like to upset like when GSK threw a hissy fit coz NICE wouldn’t approve relenza and threatened to take their operations elsewhere at which point NICE suddenly had a change of heart. That means folks that we need super lobbying power by big wigs in academia and doctors ofcourse, who we know hold a lot of power with the government- just look at the genius GP contract they mangaged to get- more money for less work.

    So lobby for what exactly? well government should subsidise drug discovery so that it’s not controlled solely by market forces. Where do we get this money from? Well we don’t even need to leave the NHS for that. if the NHS can justify a 480,000 payoff to the ex chief executive for Peterborough PCT then how about it quits its restructuring and gives it to pharma thus saving potentially millions…I digress, basically, I believe there is plenty of money to go around and by subsidising drug costs, the govt. can get it for a reasonable cost.

    The author of this blog being an academic and a doc and a super dooper award winning journalist (yep, read the bio!) would be a good place to start with lobbying action, no?

  46. ayupmeduck said,

    August 7, 2007 at 9:00 pm

    I’ve recently noticed a huge marketing campaign in Germany for the Human papillomavirus (HPV) vaccine. Every possible trick is being used by big pharma on this one including “tell your friends” emails and sponsored websites that look like none profit, but are actually run by pharma companies:

    www.tellsomeone.de/

    Since the German State currently doesn’t pay for HPV, and it costs around $400 for a four year vaccine, there seems to be a bit of a backlash growing in some quarters. It’s a pretty nasty way of marketing your product – implying social pressure to say “you don’t care much about your daughter if you won’t spend $400 on her”. What’s the deal in the UK on HPV?

  47. ayupmeduck said,

    August 7, 2007 at 9:17 pm

    @Dr Aust

    “Pharma operates much as other businesses / corporations – but of course this bring us back full circle to BG’s original point”

    Can’t disagree. But it’s also a bit more perverse than this isn’t it? People wanna have their cake and eat it. Glaxo is evil, Nike is cool, when in fact Glaxo, for all it’s faults saves lives every day, something I doubt Nike ever have done once.

  48. RS said,

    August 7, 2007 at 9:28 pm

    ayupmeduck,

    they’re thinking about vaccinating young girls (but not boys for financial reasons) I think. Which is good – because bigpharma or no, vaccinating against HPV is going to prevent a lot of cervical cancer.

  49. Arthur Dent said,

    August 7, 2007 at 10:22 pm

    Eva points out that the NHS wastes oodles of money in pay offs to executives at £480,000 well that will buy you into about 1/10th of the development costs of a single drug.

    Get real, if you wany government to pay for drug development, then you are going to be happy to see hundreds of billions of your tax dollars poured down the drain every single year

  50. jodyaberdein said,

    August 7, 2007 at 11:36 pm

    re: 58

    ‘poured down the drain every single year’

    Am I alone in thinking that when governements spend money it is likely to be wasted, but when companies do it it is legitimate R&D? Surely the question is whether the money that goes from government to health service to drug company via my prescribing pen could be better directed. Perhaps without the trite medical journal ads and free lunches, subsidised conference places etc, not to mention the worse, non-generic, polypharmaceutical prescribing that comes hand in hand with the above.

    P.S. rotavirus anyone?

  51. Robert Carnegie said,

    August 8, 2007 at 12:14 am

    I think Nike are mostly audited now for the most egregious exploitation of workers in the developing world. I think even companies producing Beijing Olympics merchandise have been given the boot. It’s the nameless, brandless imports without the high markup of Nike – who actually do (Nike) have some technologically innovative products, too – it’s the cheap goods that you have to search your soul over. Mind you, I got the shoes I’m now wearing dirt-cheap.

    Some BBC radio show – I think World Service’s [One Planet] – investigated cotton production. Someone claimed that an organic, fair-trade cotton T-shirt would cost £50 to cover its costs.

    And I suppose Nike do good by encouraging sport and physical activity, improving fitness.

  52. Dr Aust said,

    August 8, 2007 at 10:32 am

    Ayup wrote:

    “Glaxo is evil, Nike is cool, when in fact Glaxo, for all it’s faults saves lives every day, something I doubt Nike ever have done once.”

    Yes, I agree to some extent. Most of my friends who work for Big Pharma R&D are very committed to the idea of “doing something with value for humanity” and feel this way, and a number of them have contrasted it with doing research in Unis where they felt they were pressured to do “whatever was most likely to get funded”.

    So many of the people in Pharma have undoubtedly good motives. But the more one gets into the managerial levels the more the “it’s a jungle and we can’t afford to be less focused on The Bottom Line (i.e. money) than the competition” red-in-tooth-and-claw logic of corporate profitability being the only valid endpoint seems to take over. Or perhaps individual responsibility is diffused. Joel Bakan’s book on The Corporation is a sort of key text for this sort of view.

  53. gadgeezer said,

    August 8, 2007 at 11:06 am

    NYT article claims that More Generics Slow the Surge in Drug Prices.

    The [USA] currently spends $275 billion a year on prescription medicines. But over the next five years, analysts forecast a golden era for generic drugs, as patents begin to expire on brand-name medications with more than $60 billion in combined annual sales. That will open the door to copycats that may be 30 percent to 80 percent cheaper…

    The rise of generics has helped slow spending increases for prescription medications over all, even though an aging population is consuming more drugs and even as new medicines enter the market — including cancer drugs costing tens of thousands of dollars…

    Generics already account for 60 percent of prescriptions in this country. And that portion is expected to rise, as cheaper substitutes arrive to treat many chronic conditions.

    [NYT requires (free) registration or BugMeNot.]

  54. Arthur Dent said,

    August 8, 2007 at 1:02 pm

    re 59 You misunderstood me, most of the billions of dollars spent in pharmaceutical R&D is wasted in that no useful product emerges. It doesn’t matter who spends it, the outcome is the same, although the liklihood is that the drug companies are likely to be more efficient.

    I doubt if the Treasury would be very keen on seeing this amount of taxpayers money disappearing so directly. AstraZeneca is currently sending ca. $5 billion a year on R&D and is only half the size of GSK.

  55. Dr Aust said,

    August 8, 2007 at 4:49 pm

    I wouldn’t agree that Pharma is “more efficient” with R&D spending in a general way, Arthur. In running trials I could well believe it, as the PharmaCo trials machinery is well worked-out. But in the way they do basic basic research drug companies are typically far less “thrifty” than University labs, which in the UK have a long-standing tradition of ekeing the most productivity out of thin resources.

    One could write a whole book (or two) about the differences in the ways academia and Pharma do research. But they are different, which is one reason why it is important that both exist doing overlapping, and different, and complementary things.

  56. Arthur Dent said,

    August 10, 2007 at 11:05 am

    Eva, Pharma may well waste 75% of its revenue on marketing (got any figures to support such a claim?) but that doesn’t change the fact that it still spends enormous amounts of money on drug development, most of which does not suceed in producing any new drugs.

    I agree that we need a better business model, but a partnership between pharma and governemnt is unlikley to deliver anything better, and with history to guide us anyone who thinks that governemnt research or expenditure is either effective or efficient is deluding themselves.

  57. Dr Aust said,

    August 10, 2007 at 9:42 pm

    I didn’t say “government” research of expenditure, Arthur. I quote agree that governments are notorious wasters of expenditure.

    The people who can be most relied on not to waste money, in my experience, are the people in research and development who actually do the research and development, especially in cash-strapped Univs. This is because they know that money saved on one project goes to support another one.

    How you harness this “thriftiness” to do drug development is another question, but I think the basic principle is sound.

  58. Arthur Dent said,

    August 10, 2007 at 10:06 pm

    I think we need to differentiate between Research & development, Big Pharma’s core skills are in the development phase, where university scientists show no interest whatsoever.

    A lot of the fundamental research is already done in universities and in small companies. However, the big money, the major costs and thus the drievr for cost recovery by high prices is not in research it is in development. Development costs are rising fast as the public and regulators become ever more risk averse.

    Even if you outsource all research to universities you don’t solve the funadamental problem that drug development is extremely expensive and that most potentially promising drugs sourced from these exceelent universities don’t actually succeed as marketable products.

  59. Arthur Dent said,

    August 10, 2007 at 10:08 pm

    Apologiews for a second post: When we talk about money being ‘wasted’. we do not mean thrown way willy nilly by inefficiencies. By wasted I mean that money invested in a potential new chemical entity does not result in a commercial product. Usually because of lack of sufficient efficacy or the appearance of unacceptable side effects. This will occur regardless of who is doing it.

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