Archive for the ‘Big Pharma’ Category

Sales over science, profit over people, greed over need The great American medicine show, a spectacle of deceit, manipulation, and flimflammery

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Posted 17 May 2012 — by James Street
Category Big Pharma, Ethics of Science, Finance and Politics of cancer research and treatment, Legal

Butterflies waft across a beautiful field of spring flowers. A delightful young family bicycles joyously down a country lane. A couple on a park bench leans sensually into each other. A 40-something woman’s face radiates with both perfect beauty and internal happiness. “All’s right with the world,” is the message… as long as you’ve taken your dosages of Lunesta, Celebrex, Cialis, and Botox.

Welcome to medicated America, where the fix for every problem–from incontinence to erectile dysfunction, stiff joints to mood swings, weight gain to wrinkles– is just a prescription away. Thus the beautiful images, stirring music, attractive actors, and soothing words in the omnipresent, multibillion-dollar kaleidoscope of drug advertising by Pfizer, Merck, Eli Lilly, Johnson & Johnson, and other giants of Big Pharma–all pitching their particular brand-name nostrum directly at us hoi polloi (the industry spends a fourth of its income on ads and other promotions, nearly double its expenditures on research and development). The corporate come-ons typically conclude with a phrase that has achieved cliche status in America’s vernacular: “Ask your doctor if ‘Suprema Wundercure’ is right for you.”

The better question, though, is one that cartoonist Dan Piraro expressed in one of his “Bizarro” panels: “Ask your doctor if playing into the hands of the pharmaceutical industry is right for you.”

One would assume that in a rich, medically advanced, health-conscious nation like ours, dicey decisions about whether to allow a particular pharmaceutical product into our bodies would be among the most rational we make–as determined by (1) the best science available, (2) the strict moral duty of medical purveyors to “First, do no harm,” (3) good government regulation, and (4) the profession’s fear of public reproach and legal punishment. One would, however, be wrong on all counts:

  • Science has been supplanted by rank hucksterism
  • The strictest “moral duty” of corporate executives has been reduced to maximizing profits
  • A “good” regulation is one that’s good for profit seekers
  • Public reproach is just a momentary embarrassment to be covered over by corporate image makers
  • Legal “punishment” never includes jail time, but only a fine that’s easily absorbed as a necessary cost of doing business by these immensely profitable entities.

In the past three decades, America’s healthcare system has radically metamorphosed from a public service network (largely run by independent physicians and nonprofit hospitals) into a corporate profit machine–one that Dr. Arnold Relman, the renowned former editor of the New England Journal of Medicine, calls the Medical-Industrial Complex. Drugmakers have been among the most ambitious, in-your-face pushers of this transmutation of medicine into just another commodity to be sold by hook or crook. In this system, the concept of “care” has been reduced to “caveat emptor,” with the shareholders’ interest in monetary gain overriding all other interests.

 

“Today’s drug ads drive up health care costs, overstate the value of pills, and underplay the dangers of new drugs that have not been proved safe over time. The pharmaceutical industry should stop the hype and give consumers additional and more relevant facts.” –Consumer Reports, September 2006

 

The DTC contagion

A fast-moving, systemic epidemic called DTC has swept across America, endangering public health, jacking up our costs, and weakening the curative connection between health professionals and patients. DTC stands for “Direct-to-Consumer” drug advertising. It’s a plague of marketing, empowering profiteering corporations to short-circuit the judgment of doctors by using all of the tricks of Madison Avenue (including lies) to convince viewers and readers that (first) they’re suffering from a particular malady, (second) the advertiser’s brand-name medicine is the very best cure, and (finally) they must go to their doctors pronto to insist on getting a prescription for that specific drug. The essence of this marketing scheme is to turn consumers into sales representatives for drug peddlers. Brilliant.

Prescribing medicine through the television, radio, print, and internet ads of corporations (whose sole motive is to sell more pills) is so crass, so awash in conflicts of interest, and so inherently dangerous that only two countries have ever legalized it: New Zealand in 1981 and the USA in 1997.

In our country, the corporate-friendly government of Ronald Reagan first okayed DTC drug ads in 1985, but his Food and Drug Administration ruled that pages-long consumer warnings about health risks had to be included, so there were few takers. Then came Bill Clinton’s corporate-friendly government, which issued a revised FDA rule in 1997 allowing drugmakers to dodge the full disclosure provision–as long as their ads met an “adequate” standard for informing consumers about risks.

Such squishy words (slipped into regulations by industry lobbyists) are a corporate wet dream. Thanks to the adequacy loophole, fluffy-puffy, no-worries prescription drug ads quickly mushroomed. In 1997, spending on DTC ads was only $220 million; by 2002, it was $2.8 billion; and it has kept a steady pace of roughly $3 billion a year ever since.

A real reform

What if drug marketers had to tell us the details of every under-the-table payment (aka bribes) that they make to doctors? Well, here’s good news: One of the pluses in Obama’s healthcare reform law, is that they will have to do just that, perhaps as soon as next year. Republican Sen. Charles Grassley added it to ObamaCare, requiring all drug companies to publish on a publicly accessible website (as yet unnamed) every payment that they make to doctors–including the name of recipients and the amount and exact reason for each “gift.” Moreover, this reform has teeth. Federal officials will audit corporate records to assure complete disclosure. Failure to list a payment will result in a $10,000 fine for each deletion ($100,000 for knowingly hiding a payment), and top executives can be liable for omissions, since they must swear to the accuracy of each report.

Of course, industry lobbyists screeched: “Doctors may no longer want to engage in consulting arrangements,” wailed one, “and such reluctance could chill innovation.” Bullstuff. If such “arrangements” are above board, no sweat. The only thing that this breakthrough will chill is corruption. About time, too.

 

Corporations don’t spend that kind of money to dramatize the severity of their products’ nasty side effects. As two ad execs giddily put it in a 1998 report to the industry, “The ultimate goal of DTC advertising is to stimulate consumers to ask their doctors about the advertised drug and then, hopefully, get the prescription.” Obviously, to “get the prescription,” corporate ads don’t stress such unpleasant outcomes as these (taken from the small print of full-page ads for just a half dozen heavily advertised drugs): very high fevers, confusion, uncontrollable bowel movements, trouble swallowing, lower sperm count, prostate cancer, loss of vision, suicidal thoughts… and, of course, death.

Side effects do have to be addressed, but not conspicuously–for example, it’s “adequate” for an off-camera announcer to buzz through them with a muted, fast-paced delivery (usually while cartoon butterflies flutter playfully on-screen to distract viewer attention). It’s a disgusting, dishonorable way to generate sales–but it works. In 2008, the House Commerce Committee found that every $1,000 spent on drug ads produces 24 new patients, and a 2003 research report found that prescription rates for drugs promoted with DTC ads were nearly seven times greater than those without such promos. Ethics aside, these consumer hustles have proven to be profit bonanzas:

  • From 2000 through 2004, Merck & Co. poured more than $500 million into adverts promoting Vioxx, turning the pain pill into one of the “Top 100 Megabrands” listed by Advertising Age. The drug was meant for the relatively few people who can’t stomach aspirin, but the PR push touted it to all arthritis patients, a much larger marketing pool. The campaign promised “everyday victories” over pain and immobility, featuring former Olympic skating champ Dorothy Hamill spinning effortlessly (and pain-free) on the ice. Merck’s ads sold some 20 million Vioxx prescriptions, including to people who paid the ultimate price for buying the hype–a 2005 research report in The Lancet, the prestigious British medical journal, attributed as many as 140,000 sudden cardiac “events” in America to the use of Vioxx. In September of 2004, Merck took the pill off the market over “safety concerns.” As an expert pharmacy consultant told Forbes magazine in 2006, “Vioxx wasn’t a bad drug for everyone, it was a bad drug for certain patients. Unfortunately, people saw the ads and started demanding the drug from their doctors.” That’s the deadly power of mass advertising for drugs.
  • Some ads are simply frauds, including one that Pfizer ran on TV until 2006, hailing the prowess of the company’s cholesterol-lowering drug, Lipitor. The star of the spot was Robert Jarvik, who was described as the well-known “physician” who was the “inventor” of the artificial heart. In a picturesque outdoorsy setting, he was shown vigorously rowing a boat across a lake–visual “proof” that his own heart was in robust condition thanks to his use of Lipitor. His tagline was: “You don’t have to be a doctor to appreciate that.” Good, because he doesn’t practice medicine, and while he worked on the artificial heart, he did not invent it. Oh, he also wasn’t rowing the boat–a double played that role. Embarrassed, Pfizer had to yank the ad–but it continues to merchandize Lipitor with some $250 million a year in commercials, generating about $11 billion a year in sales, more than any other pharmaceutical in history.
  • Bear in mind that these pitches are being made to consumers who cannot just go purchase the product–only licensed medical professionals can diagnose and prescribe. But, again, the promotions work, as an industry spokesman happily affirmed: “There’s a strong correlation between the amount of money pharmaceutical companies spend on DTC advertising and what drug patients are most often requesting from physicians.” He also noted that the trumpeting of brand-name pills “is definitely driving patients to the doctor’s office.” No surprise, then, that prescription drug use has soared in the past decade, during which spending (by consumers, private health plans, and governments) more than doubled. A 2010 survey by the National Center for Health Statistics not only found that about 35 percent of Americans over 60 take five or more prescription medicines a day (more than twice the intake in 1999), but even 22 percent of children under age 12 are on at least one Rx regimen. “People may be taking too many drugs,” deadpanned the NCHS leader. And in recent years, a whole new market has opened up for DTC hucksters: Medical devices. In 2007, Johnson & Johnson launched the first mass-audience TV commercials for highly specialized, complex therapeutic devices. This is beyond odd; it is dangerous. Only expert practitioners have the knowledge and experience to judge whether one brand-name medical gizmo is superior to another. Yet, here was J&J doing a pitch to us clueless consumers for “Cypher,” a drug-coated coronary stent for opening closed arteries. I’m all for consumers getting more say in health care, but–come on!–how would I know enough about the efficacy of various stents to instruct my doctor to “Make mine Cyphers”?

The DTD contagion

In addition to getting you and me to push particular products on our doctors, the drug and device industry runs a massive, sophisticated, and relentless “Direct-to-Doctor” sales program that skates on the thinnest ethical ice and frequently plunges all the way into illegality. While these efforts, costing more than $6 billion a year, occasionally pretend to be “educational,” they are in fact an elaborate exercise in medical flimflammery–nothing but a door-to-door ploy by each of the major makers to hoodwink your doctor into prescribing their brand-name pill, rather than a competitor’s brand or a generic.

To do this, the biggest of Big Pharma deploy an astonishingly large force of “sales reps” all across the country–90,000 of them! That’s roughly one for every nine physicians, and they swarm non-stop into doctors’ offices–one Virginia physician says his office had to set a quota of three visits in the morning and three visits in the afternoon in order to get any doctoring done. They are highly trained in persuasive arts, motivated to make the sale at all costs, and alarmingly successful (a 2003 Blue Cross survey found that more than half of “high-prescribing” doctors relied on the reps as their main source of information about new drugs).

INTRIGUING QUESTION: What occupational sub-group of Americans are, by far, the most heavily recruited to take jobs as drug reps? You might think pharmacists, marketing consultants, or even used car salesmen. All wrong. THE SURPRISING ANSWER: College cheerleaders.

Hey, the point is to “make the sale,” to entice this mostly male profession to switch from A to B. Solid scientific evidence is one thing, but winks apparently work, too–and who’s twinklier, prettier, more buffed, peppier, or more gregarious than cheerleaders? The University of Kentucky, which boasts champion-level cheerleading squads, has been one of the premier movers of talent from pompoms to Pharma. A UK “cheering advisor” notes that his perky collegians are naturals for sales rep positions: “Exaggerated motions, exaggerated smiles, exaggerated enthusiasm–they learn those things, and they can get people to do what they want.” He says he routinely receives calls from drugmakers seeking to hire his graduates. “They don’t ask what the major is,” he says.

The demand is so high that an executive of a business that runs cheerleading camps set up a specialized employment firm in 2004 called “Spirited Sales Leaders.” Based in Memphis, it funnels hundreds of former cheerleaders into drug sales.

“There’s a lot of sizzle” in being a sales rep, he explains, and these experienced sizzle-generators can earn six figures a year, counting bonuses, for pep-talking doctors into writing more prescriptions for their companies’ medicines.

Not that these upstanding corporate citizens would stoop to hiring salespeople based on their sex appeal. No, no, explained a top executive of Bristol-Myers Squibb: “[It] has nothing to do with looks, it’s the personality.”

Sex appeal or not, the essence of the job is manipulation, and reps are highly trained and well armed to ingratiate themselves with each individual on their list of doctor-clients. Adriane Fugh-Berman, a doctor and professor at the Georgetown University Medical Center, is a drug company watchdog who has studied the doctor-sales rep relationship. In a 2007 article, she reported that the salespeople play to a doctor’s feeling of being overworked and underappreciated: “Cheerful and charming, bearing food and gifts, drug reps provide respite and sympathy; they appreciate how hard doctors’ lives are and seem only to want to ease their burdens. But every word, every courtesy, every gift, and every piece of information provided is carefully crafted, not to assist doctors or patients, but to increase market share for targeted drugs.” Here are key elements of the DTD operation:

The file. Each doctor is a mark, and drug reps are trained intelligence gatherers who build and constantly update a computerized corporate file on the doc’s personality, preferences, interests, and any personal tidbits that might help them change his or her prescribing habits. The strategic goal of good reps is to become each doctor’s trusted “friend”–not unlike the relationship that lobbyists try to cultivate with lawmakers.

The data. How can pill peddlers know which ones your doctor is prescribing–isn’t that a private matter? Not in today’s bluntly intrusive world of commercial data mining. A majority of pharmacies sell their records of every single prescription written by doctors doing business with them. This vast trove of computerized info is bought by such data hawkers as IMS Health, which procures prescriptions from about 70 percent of US pharmacies. While the names of patients are deleted, the name of the doctor who wrote each prescription is easily discernible, so pharmaceutical giants pay millions a year to buy, slice, and dice the electronic data on exactly which medicines each doctor has ordered and in what quantities. This is regularly fed to the laptops, iPads, and even smartphones of the sales reps on the ground–allowing them to target their daily pitches, and to precisely and carefully track the slightest of changes in a doctor’s prescribing habits.

The gift. Reps don’t go to a physician’s office empty-handed. Gourmet donuts and lunch treats for the entire staff are daily routines, and doctors and key staffers are treated to dinners at fine restaurants, holiday gift baskets, tickets to a game or show, and such nice personal presents as a silk tie or a monogrammed golf bag. A New York Times report in January of this year says that two-thirds of doctors accept such goodies. For the heavy prescribers of a drugmaker’s concoctions, the gifts grow ever-larger–a ski trip to Aspen, an invitation to make weekly paid “lunch and learn” presentations in other doctors’ offices, an honorarium to make brief comments at a conference in some five-star resort (complete with an “educational grant” to cover the bar tabs and other incidentals), big-buck “consulting” contracts that require practically no work, and outright cash payments for prescribing particular drugs. The Times’ January report found “that about a quarter of doctors take cash payments” and “that they are more willing to prescribe drugs in risky and unapproved ways.”

The hoax. Few doctors are experts in the chemistry and biological impacts of particular medicines, so they rely on honest studies and tests (as reported in credible medical journals) to give them an un-hyped, non-sales-rep picture of the pluses and minuses of the drugs they choose to prescribe to you and me. Unfortunately, this process, too, has been corrupted–drugmakers have regularly paid doctors and researchers to conduct studies and publish results without revealing their financial ties. Pfizer, however, sank this sales-over-science approach to new lows when it launched its antidepressant, Zoloft, in the 1990s. It hired an advertising firm to fabricate “studies,” write them up as salutary reports about the drug, pay some big-name psychiatrists a couple of thousand bucks each to put their names on the reports, and convince major journals (read by thousands of doctors) to publish the ghostwritten “findings.” About half of the medical articles about Zoloft at that time were ad agency fakes. Journal editors, embarrassed by being scammed, have since imposed safeguards, but many doctors and observers say that up to 20 percent of major journal articles are still being ghosted.

We can do better

DTC and DTD are just two surging branches of the central stream running through America’s healthcare industry–an out-of-control stream that should be labeled DTP–”Direct-to-Profit.” The very fact that healthcare, an essential human need, has been twisted into an “industry”–a commercial activity for the purpose of maximizing profits–is a damning measure of its moral bankruptcy.

As avaricious and monopolistic drug corporations have demonstrated again and again, “care” is treated, at best, as an externality to their real work of making money–and at worst as an impediment to that corporate imperative. Thus, top executives and boards of directors constantly seek ever more sophisticated forms of deception and manipulation to, at all costs, make the sale. In this ethos, such loathsome products as blatant price gouging, artificial shortages of vital medicines, deliberate promotion of pills that kill, falsification of medical research, and routine corruption of doctors are not merely tolerated, but expected and accepted as normal.

Is this the best that this great, super-rich country can do? Of course not–we Americans can, must, and will create a system that puts public need over private greed. This month’s “Do Something” features some groups leading the way. I’ll give the final word to Dr. Relman, the thoughtful, insistent, and unflagging voice for an ethical and sensible system of care built around the concept of “Medicare for all.” A decade ago, he wrote that “our health policies have failed to meet national needs because they have been heavily influenced by the delusion that medical care is essentially a business… A different kind of approach could solve our problems, but it would mean major reform of the entire system… Since such a reform would threaten the financial interests of investors… the short-term political prospects for such reform are not very good. But I am convinced that a complete overhaul is inevitable, because in the long run nothing else is likely to work.”

Inside America’s Drug Shortage

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Posted 23 Mar 2012 — by James Street
Category Big Pharma, Big Pharma, Cost, Finance and Politics of cancer research and treatment
The first in a two-part series investigating why critical prescription drugs are in short supply in the U.S.
By Alice Park | @aliceparkny | March 19, 2012

Lynn Divers thought she had heard the worst of it when doctors told her that her daughter Alyssa had cancer. But the diagnosis was only the first in a series of emotional bombshells: Alyssa’s cancer, osteosarcoma, is rare, and in her case, aggressive, requiring a cocktail of different chemotherapy drugs. She didn’t respond well to the first regimen that doctors tried, which led to their adding three other punishing medications to her treatment. Because of the chemotherapy, Alyssa’s kidneys were in danger of failing, so she would need nightly infusions of phosphorous to keep her organs functioning.

Then came the truly heartbreaking news. In late February, when Divers called the hospital to confirm Alyssa’s upcoming chemotherapy treatment, the nurse informed her that there was a drug shortage. The hospital couldn’t be sure that there would be enough methotrexate — the cornerstone of therapy for some childhood cancers, including leukemia and osteosarcoma — to treat Alyssa, now 10. Divers was told she might have to reschedule the session; the hospital would let her know. “It made me sick to my stomach to hear that,” says Divers, a former chaplain from Palmyra, Va. “Alyssa was in treatment for over a year already, and the last thing you want to do is add unnecessary delays in treatment, which gives the cancer a chance to catch up.”

Divers explains that her daughter’s cancer doubles in tumor load every 34 days, “so you need to hit it again and again to eradicate it.”

The story was much the same for Rebecca Robinson, 37, a historical interpreter from Sturbridge, Mass., when she showed up for chemotherapy at the Dana Farber Cancer Center in Boston in July. Robinson had been diagnosed with angiosarcoma, a rare, blood-based soft-tissue cancer, in February 2010, and she had already had five rounds of chemotherapy with Doxil, a drug that seemed to be keeping her cancer in check. When she showed up at the hospital expecting a sixth dose, however, her doctor told her that there was no more Doxil available. There were alternatives, but her physician wasn’t sure if the other drugs would work as well or if Robinson would have bad reactions to them.

“I was just in shock,” says Robinson. “How is it possible that no one knew this was coming? It just seemed impossible that a fairly commonly prescribed drug, especially in cancer treatments where it’s important for people to get the doses of their medicine regularly, could run out.”

For patients like Alyssa and Robinson, the questions — but no satisfactory answers — keep coming. How did this happen? How could hundreds, perhaps thousands of cancer patients suddenly find themselves without the drug treatments that could save their lives? The shortfalls have forced major cancer centers to stop putting new patients on either therapy; Dana Farber is adding only a limited number of new patients on Doxil treatment because physicians aren’t confident they can continue to provide the patients with enough of the drug to complete a full course of treatment.

In February, the U.S. government stepped in to resolve the critical cancer-drug shortages, allowing shipments of drugs from India and Australia to fill the gap. The immediate threat for many cancer patients had passed, but as Dr. Hagop Kantarjian, chairman of the leukemia department at M.D. Anderson Cancer Center in Houston, says, “All of these [efforts] are Band-Aids, temporary measures that don’t address the key issues.”

The shortfalls aren’t limited to cancer drugs either — antibiotics, anesthetics, vaccines and even medications to treat ADHD are getting scarcer. According to the Food and Drug Administration (FDA), demand outstripped the supply of 178 drugs in 2010. The University of Utah Drug Information Service, which works with the American Society of Health System Pharmacists (ASHP) to track shortfalls, says the number was actually closer to 211. Last year, the ASHP and Utah group say, the number of drugs in short supply reached a record high of 267.

What accounts for the widespread shortfalls? And why now? The FDA says 54% of the shortages in 2010 were due to manufacturing problems that led to temporary or permanent plant shutdowns. Drugmakers, while acknowledging that quality-control issues contribute to supply interruptions, point the finger back at the FDA. The agency is responsible for overseeing drug manufacturing safety and quality, but it lacks adequate funding to hire reviewers to look at companies’ applications for new manufacturing facilities and processes or to send inspectors to existing plants in a timely way. Its bureaucracy adds to delays in approvals for new facilities or manufacturing processes, which can run a year long; meanwhile, lags in new drug approvals also continue, leaving the drug supply in jeopardy.

Others cite the government’s tight price controls on generic drugs — particularly those paid for with Medicare and Medicaid — which slim down profit margins for manufacturers. Neither the government nor drugmakers subscribe to this explanation, but the argument goes that diminishing profits motivate drugmakers to abandon generics in pursuit of more profitable, patented products and de-incentivizes them from investing in better manufacturing technologies for generics. Both problems mean production of important drugs can grind to a halt when the slightest quality issue or financial glitch disrupts the system.

Congress has launched several investigations of the drug-shortage problem, and last year President Obama issued an Executive Order directing the FDA to expand its authority to police drug shortages, including requiring all manufacturers to notify the agency of impending shortages; currently the FDA can only compel companies to alert them if they are the sole maker of a drug they plan to discontinue.

The Obama Administration also instructed the FDA to report any violations of the government’s price controls on generics, which some critics believe will serve only to inflame the problem rather than resolve it.

Meanwhile, the nation’s drug supply is growing increasingly unstable, leaving an unprecedented number of patients vulnerable to lapses in care. “There’s little question that it has never been like this, not just with cancer drugs but with drug shortages in general,” says Dr. Michael Link, president of the American Society of Clinical Oncology. “We have had shortages before, but they have been intermittent, and never anything as extensive both in terms of the breadth of drugs affected and the depths of shortages and how long they lasted.”

So who’s right — the FDA or the industry? Or neither?

Follow the Money
“What’s driving the shortages is primarily the economics of drug supply,” says Kantarjian. “Anybody who tells you otherwise is not telling the truth.”

Kantarjian was directly affected by supply problems in December, when inventories of the chemotherapy drug cytarabine — a critical drug that can improve survival rates of patients with acute myeloid leukemia from 0% to 40% — began to shrink. When the shortfall was publicized, he and other cancer doctors soon received offers from distributors who appeared to have stockpiled stashes of the drug and were only too happy to sell them — for a price. They were asking $800 to $900 per gram for a medication that normally costs $16. “Nobody should profit from the lives of patients,” he says. “This price gouging is not illegal, but it is immoral.”

The distributors are not the real source of the drug shortage, however. They’re merely opportunists taking advantage of an unfortunate situation. Of the 178 drugs that the FDA reported in short supply in 2010, the majority were generics, meaning they don’t have patent protection and aren’t as profitable for the companies that make them. Many drugmakers say they are not letting their bottom line influence their focus on the manufacture of generic medications, but it’s hard to ignore the fact that the number of drug shortages has climbed in tandem with the number of generics on the market.

With cancer drugs, that’s not just coincidence, especially not after Congress changed the reimbursement scheme in 2005 for doctors administering chemo. To make chemotherapy treatments easier and more convenient for patients, doctors started offering the infusions in their own offices, instead of at a hospital, buying the drugs themselves and billing patients for them. In order to control escalating drug prices, the Medicare Modernization Act limited Medicare reimbursement to doctors to a 6% profit on these drugs, on top of the retail price of the medications. The problem was, the retail price reimbursed by Medicare lagged behind current market prices by about six months, which meant that reimbursements rates were lower than what doctors were paying to buy the drugs. That pushed some physicians to switch to offering their patients brand-name drugs, at higher prices.

The net effect? Fewer orders for generic drugs, which further shrank the market and lowered incentives for generic-drug makers to continue manufacturing such low-profit products. “In order to gain market share, companies underbid the market to get the business, and it’s a race to the bottom,” says Dr. Len Lichtenfeld, deputy chief medical officer for the American Cancer Society. “Whoever is the last company standing can’t charge enough to make a profit on the drug and to make needed investments to keep making the drug.”

That’s what may have happened with the methotrexate that Alyssa Divers depends on. Four domestic manufacturers produced the preservative-free injectable form of the drug: one company — Ben Venue Laboratories, one of the nation’s largest suppliers — decided to close its plant to make changes to satisfy the FDA after an inspection; another, which had 40% of the market share of the drug, lacked enough raw material to continue production; and a third company also started restricting its production. So by the beginning of the year, the supply of methotrexate had begun to plummet.

When Alyssa’s mother called her daughter’s nurse for a second time back in February, several days before her next scheduled infusion of methotrexate, the nurse still couldn’t assure her that Alyssa would get her dose. Even more worrisome for Divers was the fact that Alyssa already hasn’t responded to, or can’t tolerate, the side effects of two of the possible chemotherapy drugs that could fight her cancer. “If we can’t get methotrexate, that sends further terror into your heart,” she says.

Because the chemotherapy treatments have worn down Alyssa’s immune system, she has been hospitalized eight times for infections, and had a fracture in her leg that prevented her from walking for six months. “This kid has been through hell and back,” says Divers. “On top of everything else, to not have the medication she needs be available is devastating.”

Why Don’t Drug Shortages Happen in Other Countries?
The FDA maintains that price controls aren’t the problem and that its system for inspecting and certifying production facilities hasn’t changed. Rather, it’s the companies’ manufacturing issues that account for the majority of the drug shortfalls, the FDA says. Because most generics are older drugs that have been around for many years, they tend to be made in older facilities that have not kept up with the latest standards, making them more vulnerable to violations of FDA requirements. “The reality is that many of these facilities are getting older,” says Dr. Margaret Hamburg, the FDA’s commissioner. “These are not brand-new drugs and manufacturing facilities, so as the manufacturing facilities age, that creates new opportunities for quality and manufacturing concerns.”

The Generic Pharmaceutical Association (GPhA), however, says that in recent years, inspections have become harder to pass. “From the industry’s perspective, the FDA has been much more aggressive in their inspection formats over the past two to four years,” says David Gaugh, senior vice president for regulatory sciences at GPhA, who has had experience at a generic manufacturer.

Further, generic-drug makers say that once the FDA inspects a plant and leaves company officials with a list of items that don’t meet its specifications for quality and safety, the company has 15 days to respond with a plan to address the deficiencies. But the FDA does not always respond with a timely green light for the plan, leaving companies with difficult decisions to make about how much to invest in changes and whether to shut down production lines in the interim.

The good news is, that situation has been changing, and drugmakers say the FDA has recently become more open and communicative about efficiently addressing quality and manufacturing problems. But the ongoing buildup of shortages suggests that the problem goes deeper than sluggish communication during the inspection process.

Why, for example, are the shortages hitting certain kinds of drugs hardest, including those that have to be kept sterile and are made in injectable form? The FDA and drugmakers say it’s because these drugs are more complicated to make, and requirements for ensuring that they remain sterile, and free of any contaminants or foreign objects, are more stringent than they are for punching out pills.

Other observers point once again to the economics, noting that it costs more to manufacture sterile injectables — which include methotrexate and the flu vaccine — while their selling price remains relatively low. They also note that drug shortages are more common in the U.S. than in Europe or other countries, owing primarily to the smaller profit margin for generics here. In the U.K., for example, generic drugs often cost more than brand-name medications because the government health system is the primary purchaser of pharmaceuticals, and their negotiated price for brand drugs are far lower than they are in the U.S.

That also leads to the siphoning of generic drugs from the U.S. supply, which may also contribute to the shortfalls. “Because the profit margin is higher for generic drugs in Europe and outside the U.S., it’s rare to see a shortage in these drugs anywhere but here,” says Kantarjian.

Sylvia Bartel, vice president of pharmacy at Dana Farber, says, “I have never seen shortages like this before, especially for drugs that have been around for a really long time that we would not have thought were difficult to obtain. I think a lot of it does have to do with the economics around generics.”

The FDA is confident that it has resolved the immediate emergency around the shortages of methotrexate and Doxil (a brand-name medicine). But will it be enough?

Stay tuned for Part 2 of Healthland’s investigation into drug shortages: “Scrambling for a Solution”

Hope or Hype: The Obsession with Medical Advances and the High Cost of False Promises

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Posted 19 Mar 2012 — by James Street
Category Big Pharma, Big Pharma, Books, Ethics of Science, FDA, Finance and Politics of cancer research and treatment

Book Description

Publication Date: January 15, 2005
“Medical science has always promised — and often delivered — a longer, better life. But as the pace of science accelerates, do our expectations become unreasonable, fueled by an industry bent on profits and a media desperate for big news? Hope or Hype is a taboo-shattering look at what drives the American obsession with medical “miracles,” exposing the equipment manufacturers and pharmaceutical companies; doctors and hospitals too quick to order surgery; the politicians; the press; and our own “technoconsumption” mindset. The authors spread blame for the parade of so-called miracle cures that too often are marginally effective at best — and sometimes downright dangerous. They examine consumers’ eager embrace of medical advances, and present riveting stories of the conscientious doctors and researchers who blew the whistle on ineffective treatments. Finally, they provide sane, practical recommendations for the adoption of new developments. The consequences of questionable practices include costly recalls, billions in wasted money, and the pain and suffering of innumerable patients and their families. In short, they must stop.”

From The New England Journal of Medicine

Armed with support from the Robert Wood Johnson Foundation, Deyo and Patrick make a well-documented — if depressing — argument that doctors, scientists, and laypersons alike are far too easily seduced by industry hype for merely new (as opposed to truly better) drugs and medical devices. Deyo and Patrick are appropriately tough on the Food and Drug Administration’s (FDA’s) drug approval process, in part because the agency’s mission does not include weighing one drug against another but, rather, merely approving a new drug if it works at all, even if it has no advantages over cheaper drugs already on the market. The authors are even tougher on the FDA’s process for approving medical devices, deftly hanging the agency by its own quotes, such as this gem: “New devices are less likely than drugs to have their safety established clinically before they are marketed.” And, of course, they note that it is not part of the FDA’s mission to regulate surgical procedures. But the basic message from Deyo and Patrick, both professors at the University of Washington, is that we are all too ready to believe that new, expensive, or aggressive care must be better than older, cheaper, or milder treatments. It is a cultural thing, they argue, citing one study that showed that whereas 34 percent of Americans believe that modern medicine can cure almost anything, only 27 percent of Canadians and 11 percent of Germans do. There is little that is new in this book for anyone who has followed the medical journals and the mainstream press over the past decade. But it is an excellent reference for the reader who wants details of the horror stories that have grabbed headlines: the rise and fall of the fenfluramine-phentermine diet pill (sometimes referred to as “fen-phen”); the high failure rate associated with some cardiac pacemakers; the widespread use of bone marrow transplantation for advanced breast cancer before studies finally showed that it was no more effective, and could be more dangerous, than standard chemotherapy; the appalling suppression or delayed publication of “negative” results in studies funded by drug makers. Citing example after example, Deyo and Patrick are at their most successful when they detail the degree to which the pharmaceutical industry, the most profitable industry in the United States, sometimes abuses its enormous power. Happily, just when you are about to move on to something, anything, else, Deyo and Patrick come up with a comparatively upbeat ending, exploring some remedies for America’s ills. They like the idea of having insurers pay provisionally for some new treatments so that the insurers could easily stop payment if a treatment proved worthless or dangerous. They like the idea, endorsed last September by a coalition of editors of medical journals, including this one, of a national registry for clinical trials in order to make it harder for the manufacturers of drugs and devices to suppress negative findings. They want to stop drug companies from claiming marketing expenses as tax deductions — a no-brainer, in my mind. And they want a better post-marketing surveillance system for drugs and devices. None of this will be easy. Fixing the mess, the authors conclude, will “require action by doctors, hospitals, the media, and the government.” Judy Foreman, Ed.M.

From Booklist

The authors, medical research academics, present their analysis of a phenomenon in American culture, which seeks state-of-the-art medicine regardless of the price. Avoiding controversial issues such as stem-cell research and abortion, theirs is an indictment of our health-care players, including the drug industry, device manufacturers, the media, the government, advocacy groups, hospitals, doctors, and patients. Deyo and Patrick recommend all parties change their behavior. Their concerns include aggressive marketing of new and costly products that contain only modest or no advantage over older alternatives, and doctors performing unnecessary operations. They focus upon whether and how new treatments sometimes become popular. They conclude that while fewer people in the U.S. can get insurance, people with insurance are getting a richer package of treatments although some of the technology they are buying is worthless. This is an important topic, and although many may argue with the authors’ views, they present an excellent framework for debate and discussion. Mary Whaley

FDA Commissioner Margaret Hamburg pushing to eliminate conflict of interest laws, allow paid drug company shills to fill advisory positions

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Posted 18 Aug 2011 — by James Street
Category Big Pharma, Big Pharma, Ethics of Science, FDA, Finance and Politics of cancer research and treatment

Thursday, August 18, 2011 by: Ethan A. Huff, staff writer

Natural News.com

(NaturalNews) At a time when drug industry corruption is reaching a pinnacle of public exposure, the US Food and Drug Administration (FDA) is actually proposing eliminating one of the few pseudo-effective measures in place that restricts the agency from becoming a full-blown Big Pharma “rubber stamp” consultant.

In a recent announcement, FDA Commissioner Margaret Hamburg stated that the agency may next year loosen certain conflict of interest restrictions that prevent scientists with financial ties to the drug industry from becoming members of FDA advisory panels.

There are 45 different FDA advisory committees that, according to the FDA’s own website, are supposed to obtain “independent expert advice on scientific, technical, and policy matters.” In other words, these panels are purportedly to be composed of objective, unbiased individuals that do not have financial or other ties to the very companies about which they are advising. Makes sense, right?

Well, in the eyes of Commissioner Hamburg, these common sense restrictions, which at least give the illusion that the FDA conducts honest regulatory work on behalf of the people, are unreasonable and must be eliminated.

Hamburg apparently believes that drug industry-funded “scientists” are vital to the FDA’s work, having stated publicly that allowing Big Pharma shills to serve on advisory committees is essential if the agency is to get the information it needs to make decisions.

“We have to be sure that FDA has subject-matter experts that we need for our important decision making,” stated Hamburg. But expecting to receive “independent expert advice” from industry-sponsored consultants posing as scientists rather than actual independent scientists, however, is the epitome of inane — and this is precisely what Hamburg is suggesting as a correct form of FDA policy.

Does the FDA have the power to change its own regulatory restrictions?

Aside from Hamburg’s senseless and illogical opinions about how best to obtain crucial decision-making information, the other glaring elephant in the room is the fact that the FDA can apparently change its own regulatory restrictions at will. What is the point of an agency having conflict of interest restrictions placed on it when that very same agency can simply change them when they are no longer convenient?

Last time we checked, Congress was still in charge of creating and passing laws, not the FDA. But Commissioner Hamburg seems quite sure of herself, presumably because of expressed congressional support, that the FDA’s conflict of interest laws will soon be history. And it appears, based on the FDA’s released draft guidance, that the FDA is actually the one in charge of amending its own policies (http://www.fda.gov/RegulatoryInform…).

The FDA claims that it needs to loosen or eliminate the conflict of interest policies from its advisory committee procedures because it is unable to find enough members to serve on its committees. According to a recent Bloomberg report, only 77 percent of FDA advisory committee positions were filled as of March 2011, which leaves 138 vacant positions out of 608 total.

But if the FDA is having a hard time filling these positions, perhaps it would do best to begin looking for eligible candidates in other places. And Robert Weissman, president of the non-profit consumer advocacy group Public Citizen, agrees, having stated that the rules should not change because the FDA is unable, or unwilling, to find independent scientists to fill its ranks.

“We need strong protection rather than less,” state Weissman, following Hamburg’s statements to his group about needed to relax or change the law.

A study published back in March by researchers from the University of Pennsylvania’s School of Medicine discredits the FDA’s claim, having found that about 44 percent of cardiologists have no ties to the drug industry. Eric Campbell, an associate professor of medicine at Harvard University and one of the study’s authors, stated that the study “flat out dismisses this idea that there are no experts who don’t have relationships,” a claim being made by the FDA in support of its proposed new guidelines (http://www.reuters.com/article/2011…).

“There are lots of people out there who are smart and who don’t have conflicts of interest,” said Sid Wolfe, also with Public Citizen. “It just takes much more work for the FDA to find them. But the result is you have much less tainting of the panel discussion.”

Tell the FDA to do its job, not tailor laws to suit the agenda of special interests

According to the FDA’s draft guidance, the agency published a final rule on February 2, 1998, requiring clinical investigators who submit marketing applications for drugs or medical devices to also disclose whether or not they have financial ties to the companies who make the products they reviewed. Current guidelines also limit who can serve on advisory committee positions.

Both of these policies can work, at least as long as the FDA is willing to put in the work necessary to find qualified individuals who are not on the payrolls of drug and medical device companies. But the agency is demonstrating a pure unwillingness to do this, and instead is planning to cave to the drug industry and to certain lawmakers who are pushing to have the law amended instead.

Though the official comment period for the FDA’s proposed new guidance for financial disclosure by clinical investigators ended on July 25, it is still crucial to contact the FDA and tell it to stop catering to special interests, and to leave be the conflict of interest policies that help preserve what little integrity remains in the agency’s advisory committee process.

You can contact the FDA to oppose the new draft guidance by writing to:

Dockets Management Branch (HFA-305)
Food and Drug Administration
5630 Fishers Lane, Room 10-61
Rockville, MD 20857

Or calling:
(888) 463-6332

Be sure to reference Docket No. FDA-1999-D-0792

To contact FDA Commissioner Margaret Hamburg directly, you can call her:

(301) 796-5000

Or email her:

Office: Margaret.Hamburg@fda.hhs.gov
Personal: margaretahamburg@aol.com

You can also contact your representatives by visiting:
http://www.congress.org

Sources for this story include:

http://www.federalregister.gov/arti…

http://www.bloomberg.com/news/2011-…

 

FDA Strangling Consumer Health

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Posted 15 Jun 2011 — by James Street
Category Big Pharma, Chemotherapy, Cost, Drug Companies, Drugs, FDA, FDA, Finance and Politics of cancer research and treatment

6 November 2003
by Wyn Snow, Managing Editor

Skyrocketing public health costs are bankrupting individual Americans and posing serious challenges to city, state, and federal budgets. The high cost of prescription drugs may be only the tip of the iceberg—but it’s also the most visible and easiest to attack.

While Congress debates legislation, Americans are already voting with their checkbooks—going to Canada and Europe to buy prescription drugs. Increasing numbers of Americans are also choosing lower-priced supplements rather than expensive prescription drugs as their first line of defense against illness.

Yet the FDA is fighting both initiatives—saying they cannot guarantee the safety of imported drugs, and challenging both the safety and effectiveness of many dietary supplements.

The high price of drugs in America acts as a defacto subsidy of lower prices in other countries. Why should Americans carry such a disproportionate burden? Especially when that burden falls most heavily on the elderly, many of whom live on fixed incomes and are forced to choose between pharmaceutical drugs that will prolong their lives and the immediate necessities of life: rent, food, heat, electric power, telephone service.

In these murky waters, what are the facts about drug prices and safety risks of imported drugs? How does price regulation affect drug research? Why are prescription drugs so expensive? What alternatives exist for reducing their cost? And how do these issues impact dietary supplements?

Option 1: Crossing the border

Americans have been crossing the border to Canada for lower-cost prescription drugs for a decade or more, even though it is illegal to buy drugs abroad and bring them into the US. Only pharmaceutical manufacturers may import such products.

The FDA has turned a blind eye to busloads of Americans going north. William Hubbard, FDA associate commissioner, explains “it’s so uncompassionate to go after patients.” He says the FDA understands the price concerns, but says imports expose Americans to potentially counterfeit or expired drugs—and that FDA cannot guarantee the safety of drugs from foreign countries.

How dangerous are these “foreign” drugs?

According to William Faloon, director of the Life Extension Foundation, “Many of the active ingredients for drugs sold in the US are actually synthesized in the very countries the FDA says you cannot trust. Drug companies import these active ingredients into the United States where they wind up in the expensive drugs you buy at the local pharmacy.”

Canada’s Health Minister, Anne McLellan, says that Canada has “some of the highest drug-safety standards in the world.”

CanadaDrugs.com is one of the largest exporters of drugs to the US. Their director of pharmacy, Robert Fraser, echoed the Health Minister’s confidence in the safety of Canadian drugs, saying, “The products we use are all approved by the Canadian version of the FDA. Anybody can come and see for themselves. We’re very transparent.”

FDA seeks to shut down Internet imports

Even for drugs originally manufactured in the US, the FDA is less tolerant of citizens using the Internet instead of the highways to reimport such drugs from abroad. On September 4th, the Justice Department filed an injunction against Rx Depot, an Oklahoma-based storefront & Internet business, asking a judge to stop it from importing drugs from Canada.

Rx Depot owner Carl Moore says he is “on a crusade” to make lower-cost prescription drugs available, and has vowed to defy the law and continue business. Moore’s lawyer, Fred Stoops, believes the importation regulations violate both the antitrust laws and the North American Free Trade Agreement. The first court hearing on this case was held on October 8th in Tulsa OK; a decision can be expected after October 31st.

Mayors and governors join the “busloads to Canada”

The city of Springfield, Massachusetts has already begun buying drugs in Canada for city workers and retirees (up to 9,000 are eligible). Mayor Michael Albano says potential savings could reach $9 million per year. He characterizes the FDA’s talk of health risks as disingenuous, saying, “How many Canadian citizens have been harmed by counterfeit medicines? Let’s get real here. That’s not an issue, and you know it’s not an issue.”

This grass roots rebellion is spreading. Mayor Albano has received inquiries from state governments in California, Connecticut, Indiana, Michigan, Nebraska, North Carolina, as well as other towns in Massachusetts.

Illinois Governor Rod Blagojevich has authorized a study on purchasing Canadian drugs for its 240,000 state employees and retirees. Illinois’ drug budget rose 15% to $340 million this year, and is projected to rise another 17% next year. Blagojevich says, “It doesn’t matter where you go in our state, you meet people who are struggling with the cost of prescription drugs. If you can buy the same drug made by the same company, and it is safe and it costs less, then that makes sense.”

Congress debates legislation

In two previous years, Congress passed legislation that would allow re-importation of prescription drugs, but both bills required the secretary of the Department of Health and Human Services (HHS) to certify the drugs were safe before proceeding. HHS secretaries in both the Clinton and Bush administrations (Donna Shalala and Tommy Thompson respectively) declined to do so.

Congressman Gil Gutknecht of Minnesota introduced the Pharmaceutical Marketing Access Bill (House 2427), which was passed by the House in July 2003. The Senate also passed similar language in an amendment to the Medicare Bill. A conference committee is now debating how best to merge the differences into a single piece of legislation, and the results should become available within a few weeks.

Concerning this bill, Gutknecht points out that pharmaceuticals are the only product in the US to have such strict import limitations and that closed markets inevitably lead to artificially high prices. Gutknecht says, “We are a blessed country with a lot of wealth, so we should help make prescription drugs more affordable for developing countries, especially Africa. But subsidizing the entire world and ‘the starving Swiss’ does not make sense. Americans deserve to have a more fair system so we’re not shouldering the entire burden.”

According to Gutknecht, “In a day and age when we import millions of pounds of food daily we certainly can import highly controlled products such as pharmaceuticals.” And on the issue of safety, “Would anyone at the FDA seriously propose that the only way to ensure the safety of imported food is to ban importation?”

How much lower are foreign drug prices?

“A bottle of tamoxifen, used to fight breast cancer, costs $360 in the United States. It costs $60 in Germany,” according to Representative Jo Ann Emerson of Missouri.

The US is the only industrialized nation where prices are unaffected by government regulation. Canada sets a ceiling on the price of each drug. These caps are linked to European price controls, most of which are linked to one another. For example, Dutch prices are an average of those in four other countries, while Greece requires a drug’s price to be the lowest of any other price in Europe.

However, price controls are not the only reason why prices are lower abroad. Canada and other single-health-care entities enjoy the economies of scale that result from buying in massive quantities and negotiating directly with drug companies.

A casual survey by SupplementQuality.com and a more extensive effort by the Life Extension Foundation indicate that drug prices vary widely. Searching the Internet is a good strategy for finding the lowest price, both within the US and overseas. Generally speaking, the Canadian price of a drug can be as low as one-eighth of US prices, and European prices as low as one-sixth—although both can also be as much as double the US price. (See detailed price comparison.)

Dietary supplements also a cost-effective alternative

For health issues where dietary supplements are useful, the daily cost often runs from 10% to 25% of pharmaceutical alternatives.

Why are drugs so expensive?

The Life Extension Foundation investigated the cost of generic ingredients in sixteen prescription drugs—and discovered they vary from a few pennies per tablet to a few pennies per hundred tablets. Prices for these same products range from 2,800% to 570,000% higher (see the real cost of drugs)—but drug profits are only about 15% of the purchase price.

Where is the other 85% going? Some goes into manpower, advertising, and other ordinary business costs—but the vast majority is spent on research. The pharmaceutical industry claims that lost revenue from price reductions would constrict funds available for research—thereby slowing innovation for new drugs that could help patients with incurable diseases.

Why is pharmaceutical research so expensive?

Finding one successful new drug means investigating roughly 67 to 100 possible compounds. The following table shows the stages of drug research and how they winnow the candidates down.

Stage Time Remaining compounds
Concept/discovery 1-2 years 100
Screening 1 years 20-30
Testing with animals and human cells in test tubes 2-3 years 12-15
Testing for safety in healthy people (clinical phase I) 1-2 years 4-5
Testing for effectiveness (clinical phase II) 1-2 years 2-3
Wider testing for effectiveness (clinical phase III) and FDA approval 2-3 years 1.0-1.5

[Adapted from Millennium Pharmaceuticals, 1999.]

Cost estimates for developing a single new drug range from a minimum of $250M to as much as $900M. The most-often cited cost is $500M.

Impact of embracing cost-regulation

Importing drugs from Canada or Europe can certainly reduce their cost for individual consumers and health organizations as well as city and state government, but would have other, more troubling consequences. Cost-regulation rarely works in the long term. It merely clamps a lid on burgeoning costs and creates a “pressure cooker” effect. The steam of rising costs has to go somewhere—and companies are even more likely than consumers to “vote with their feet.”

Until recently, European pharmaceutical companies dominated new drug development. With the advent of price controls, the leading edge of pharmaceutical research has shifted to the US. Unfortunately, innovation will suffer if the US embraces the cost-regulation that is inherent in European and Canadian drug prices.

However, innovation is already suffering from the high cost of drug research, which has two vital ramifications:

  1. Only large companies with vast resources are able to undertake new drug research.
  2. The only attractive targets of new drug research are for diseases or conditions affecting many people, or for maintenance drugs that patients need to take every day for the rest of their lives (examples being diabetes and high blood pressure).

In other words, the more rare the disease, the lower the likelihood of ground-breaking drug research to cure it. Even though a single rare disease affects a small number of people, there are thousands of such diseases. Taken as a group, the American Medical Association (AMA) estimates that 10% of the overall population suffers from rare diseases.

Similarly, the less chronic the disease, the less incentive there is to develop a “one time cure” pharmaceutical.

Another troubling trend documented by recent TV exposes is that drug research increasingly focuses on discovering compounds similar to those that already exist—such as new statins or new beta-blockers—rather than investigating entirely new fields. Finding a molecule similar to already proven drugs is easier, cheaper and less risky than finding altogether new substances.

Whether price regulation is adopted directly or by importing drugs from countries using regulation, the end result is constrained innovation—yet the continued explosion in the cost of pharmaceuticals is equally unacceptable to Americans. This lose-lose situation prompts a new question: Is there another way of reducing the cost of drugs?

Option 2: Reform the FDA approval process

Prior to 1962, the FDA-approval process for a new drug stopped with testing for safety (phase I clinical research). Restoring this standard would cut the cost of research roughly in half, thereby cutting the cost of drugs like tamoxifen from $360 per bottle to somewhere between $145 and $200—without any price regulation whatsoever.

Would these new drugs be effective?

Nobody wants to spend $145 or more for a substance that doesn’t work better than a placebo. So how would we test the effectiveness of new drugs? One method is to open this phase of clinical research to any patients who want to try the new drug, and creating a database system to assist physicians in tracking success versus failure.

Are current drugs more effective than pre-1962?

At least two studies have concluded that drugs introduced before 1962 were, for the most part, as effective as drugs approved after 1962. In other words, the increased time and cost of research required for obtaining FDA approval has not resulted in safer or more effective drugs.

Two private market forces exert a powerful influence on companies in bringing new drugs to the marketplace: the importance of having a good reputation (which is harmed by creating either unsafe or ineffective drugs), and the potential for lawsuits, especially in these litigious times. These two factors, combined with private organizations and endeavors that review use of drugs—such as AMA Drug Evaluations, American Hospital Formulary Service Drug Information, and U.S. Pharmacopoeia Drug Indications—worked to ensure that pre-1962 drugs were roughly as effective as those of today.

Hidden consequences of the current FDA approval system

Doctors Daniel Klein and Alexander Tabarrok of The Independent Institute point out that “Even after extensive testing, the safety and effectiveness of a new drug are always somewhat uncertain.” They describe two kinds of errors that can occur:

  1. FDA approves a drug that is not safe or effective.
  2. FDA rejects or simply delays a drug that would be valuable for patients.

The FDA is strongly motivated to avoid type 1 errors—these deaths and disabilities get a lot of media attention—but has no motivation at all to avoid type 2 errors, which are almost invisible to the media.

What are the consequences of type 2 errors? People die from not having access to drugs that might save them. The most highly visible example is delays in processing drugs for treating HIV. Only the well-publicized protests of HIV patients and activists prodded the FDA into streamlining its approval process.

How many people are dying from lack of access to potentially life saving drugs?

This invisible epidemic is estimated to number at least hundreds of thousands of people. Delays in approval for just two beta-blockers (which were available in Europe several years before the US), probably led to several tens of thousands of deaths from heart attacks. Other medicines and devices that were available for at least a year in Europe before being approved in the US are Ancrod, Citicoline, Ethyol, Femara, Glucophage, Interleukin-2, Lamictal, Navelbine, Omnicath, Panorex, Photofrin, Prostar, Rilutek, Taxotere, Transform, and Vasoseal.

And these are only for drugs whose names are known because they were approved. What about type 2 errors where a useful drug was rejected? Returning to the pre-1962 standard of proof of safety would give Americans and their doctors wider freedom of choice in treating life-threatening illnesses, and would hasten vital knowledge about new approaches and treatments for cancer, heart disease and strokes, diabetes, and genetic diseases. More lives would be saved sooner.

The FDA also prevents dying patients from trying new drugs and treatments that might save them until they have exhausted all currently approved methodologies. In the case of cancer, however, some chemotherapy and/or radiation treatments can make a tumor more resistant to new experimental treatments, thereby affecting the fundamental research itself and possibly sabotaging a treatment that might save a patient’s life.

When does the banner of consumer protection become a garrote?

The debate on reforming our health system is framed as runaway prices versus patient safety, but a far more basic issue is at stake—namely who decides what treatment a patient will receive?

Established in 1906 to protect public health from diluted and adulterated foods and drugs, the FDA is still using nineteenth-century technology—bureaucratic red tape—to attack twenty-first century problems. Today, the environment is one of increased globalization and vanishing international trade barriers. Americans are entitled to seek out the best medical care and the best prices they can find anywhere in the world—both inside and outside our borders.

Decisions about which drugs and treatments to use—including new drugs, off-label uses of existing drugs, and alternative treatments including supplements—are best placed firmly in the hands of patients who need them and doctors with expert knowledge about drugs and treatments. FDA bureaucrats are motivated primarily to keep their lucrative pharmaceutical industry user fees and to avoid media exposes and Congressional hearings into type 1 errors.

By acting as the sole arbiter on whether a drug is effective and whether a dying patient can or cannot try a new experimental treatment, the FDA is saying, in essence, that doctors are not competent to decide which drugs to recommend for treating a patient, and that patients are not competent to participate in decisions about which therapies to choose. The FDA is wrong on both counts.

To read more about how excessive FDA regulation is costing lives and to learn about alternatives that are a better choice, we recommend reading this Critique of FDA Drug Regulation and Suggested Alternatives by The Independent Institute (www.fdareview.org)

“If people let the government decide what foods they eat and what medicines they take, their bodies will soon be in as sorry a state as are the souls who live under tyranny.” —Thomas Jefferson

Sources

Theresa Agovino. “Justice Department files suit against storefront broker for Canadian Drugs.” Associated Press. 11 September 2003.

Theresa Agovino. “Rx Depot owner digs in heels; Entrepreneur sees Canadian drug imports as higher calling.” Associated Press. 4 October 2003.

Robert B. Bluey. “Dietary Supplements Trigger Debate in Congress.” CNSNews.com.

John E. Calfee. “The High Price of Cheap Drugs.” Editorial in The Weekly Standard, 21 July 2003.

Centerwatch.com. “Background Information on Clinical Research.” Centerwatch.com.

Ceci Connolly. ” FDA tries to counter drug-import movement.” The Seattle Times, 30 September 2003.

Dain Rauscher Wessels. “Millennium Pharmaceuticals.” Prospectus, Dain Rauscher, Inc. 15 June 1999.

Monica Davey. “Illinois Considers Buying Drugs in Canada.” The New York Times, 15 September 2003.

David Espo. “Lobbying Strong Vs. Prescriptions Bill.” Associated Press, 24 July 2003.

William Faloon. “The FDA Versus The American Consumer.” Life Extension Magazine, October 2002.

William Faloon. “As We See It: FDA’s Lethal Impediment.” Life Extension Magazine, August 2003.

Frederic J. Frommer. “Industry Spends $8M to Thwart Drug Bill.” In Yahoo news, Associated Press, 12 October 2003.

Becky Gillette. “Battle over prescription drugs intensifies; Mississippi’s rural seniors paying ‘highest cost for prescription drugs’.” Mississippi Business Journal, 14 August 2000.

Tim Harper. “Illinois wants Canadian drugs; Cash-strapped state eyes savings; Epic battle with Bush looming.” Toronto Star, 16 September 2003.

Gardiner Harris. “F.D.A. Faults Quality of Imported Drugs.” The New York Times, 30 September 2003.

Mathew Ingram. “Canada caught up in drug war.” The Globe and Mail, 9 September 2003.

Daniel B. Klein, PhD, and Alexander Tabarrok, PhD. “Is the FDA Safe and Effective?” In fdareview.org, a website of The Independent Institute.

Daniel B. Klein, PhD, and Alexander Tabarrok, PhD. “The Sensible Alternative: The Voluntary Provision of Assurance.” In fdareview.org, a website of The Independent Institute.

Roy Mark. “FDA Warns U.S. Site Selling Canadian Prescription Drugs.” dc.internet.com, 17 September 2003.

William D. Novelli. “Letter from AARP CEO Bill Novelli Expressing AARP’s Support of Prescription Re-importation Legislation.” American Association of Retired Persons, Washington DC, 6 August 2003.

Christopher Rowland. “FDA tells supplier to halt Canadian drug orders; Springfield mayor defiant on import of prescriptions.” The Boston Globe, 17 September 2003.

Randolph E. Schmid. “Nearly 9 of 10 of Drug Imports Break Law.” Yahoo News, Associated Press, 29 September 2003.

The Capital Times. “Editorial: States can cut drug costs.” The Capital Times, Madison WC, 29 September 2003.

The Washington Times, Editorials/Op-Ed. “Improving the drug market.” The Washington Times, 19 June 2003.

Sharon Theimer. “Proposal to let consumers import prescription drugs draws fierce lobbying.” Associated Press, 23 July 2003.

Steve Turnham. “Senate votes to allow drug importation from Canada; Medicare bill debated.” CNN Washington Bureau, 20 June 2003.

USA Today. “Industry discourages study of new drugs’ effectiveness.” USA Today, 15 September 2003.end-of-story

The Truth About the Drug Companies

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Posted 25 May 2011 — by James Street
Category Big Pharma, Big Pharma, Book Reviews, Cost, Drug Companies, Educational, Ethics of Science, Finance and Politics of cancer research and treatment, Legal, Understanding Cancer
July 15, 2004

Marcia Angell

Every day Americans are subjected to a barrage of advertising by the pharmaceutical industry. Mixed in with the pitches for a particular drug—usually featuring beautiful people enjoying themselves in the great outdoors—is a more general message. Boiled down to its essentials, it is this: “Yes, prescription drugs are expensive, but that shows how valuable they are. Besides, our research and development costs are enormous, and we need to cover them somehow. As ‘research-based’ companies, we turn out a steady stream of innovative medicines that lengthen life, enhance its quality, and avert more expensive medical care. You are the beneficiaries of this ongoing achievement of the American free enterprise system, so be grateful, quit whining, and pay up.” More prosaically, what the industry is saying is that you get what you pay for.

Is any of this true? Well, the first part certainly is. Prescription drug costs are indeed high—and rising fast. Americans now spend a staggering $200 billion a year on prescription drugs, and that figure is growing at a rate of about 12 percent a year (down from a high of 18 percent in 1999).1 Drugs are the fastest-growing part of the health care bill—which itself is rising at an alarming rate. The increase in drug spending reflects, in almost equal parts, the facts that people are taking a lot more drugs than they used to, that those drugs are more likely to be expensive new ones instead of older, cheaper ones, and that the prices of the most heavily prescribed drugs are routinely jacked up, sometimes several times a year.

Before its patent ran out, for example, the price of Schering-Plough’s top-selling allergy pill, Claritin, was raised thirteen times over five years, for a cumulative increase of more than 50 percent—over four times the rate of general inflation.2 As a spokeswoman for one company explained, “Price increases are not uncommon in the industry and this allows us to be able to invest in R&D.”3 In 2002, the average price of the fifty drugs most used by senior citizens was nearly $1,500 for a year’s supply. (Pricing varies greatly, but this refers to what the companies call the average wholesale price, which is usually pretty close to what an individual without insurance pays at the pharmacy.)

Paying for prescription drugs is no longer a problem just for poor people. As the economy continues to struggle, health insurance is shrinking. Employers are requiring workers to pay more of the costs themselves, and many businesses are dropping health benefits altogether. Since prescription drug costs are rising so fast, payers are particularly eager to get out from under them by shifting costs to individuals. The result is that more people have to pay a greater fraction of their drug bills out of pocket. And that packs a wallop.

Many of them simply can’t do it. They trade off drugs against home heating or food. Some people try to string out their drugs by taking them less often than prescribed, or sharing them with a spouse. Others, too embarrassed to admit that they can’t afford to pay for drugs, leave their doctors’ offices with prescriptions in hand but don’t have them filled. Not only do these patients go without needed treatment but their doctors sometimes wrongly conclude that the drugs they prescribed haven’t worked and prescribe yet others—thus compounding the problem.

The people hurting most are the elderly. When Medicare was enacted in 1965, people took far fewer prescription drugs and they were cheap. For that reason, no one thought it necessary to include an outpatient prescription drug benefit in the program. In those days, senior citizens could generally afford to buy whatever drugs they needed out of pocket. Approximately half to two thirds of the elderly have supplementary insurance that partly covers prescription drugs, but that percentage is dropping as employers and insurers decide it is a losing proposition for them. At the end of 2003, Congress passed a Medicare reform bill that included a prescription drug benefit scheduled to begin in 2006, but as we shall see later, its benefits are inadequate to begin with and will quickly be overtaken by rising prices and administrative costs.

For obvious reasons, the elderly tend to need more prescription drugs than younger people—mainly for chronic conditions like arthritis, diabetes, high blood pressure, and elevated cholesterol. In 2001, nearly one in four seniors reported that they skipped doses or did not fill prescriptions because of the cost. (That fraction is almost certainly higher now.) Sadly, the frailest are the least likely to have supplementary insurance. At an average cost of $1,500 a year for each drug, someone without supplementary insurance who takes six different prescription drugs—and this is not rare—would have to spend $9,000 out of pocket. Not many among the old and frail have such deep pockets.

Furthermore, in one of the more perverse of the pharmaceutical industry’s practices, prices are much higher for precisely the people who most need the drugs and can least afford them. The industry charges Medicare recipients without supplementary insurance much more than it does favored customers, such as large HMOs or the Veterans Affairs (VA) system. Because the latter buy in bulk, they can bargain for steep discounts or rebates. People without insurance have no bargaining power; and so they pay the highest prices.

In the past two years, we have started to see, for the first time, the beginnings of public resistance to rapacious pricing and other dubious practices of the pharmaceutical industry. It is mainly because of this resistance that drug companies are now blanketing us with public relations messages. And the magic words, repeated over and over like an incantation, are research, innovation, and American. Research. Innovation. American. It makes a great story.

But while the rhetoric is stirring, it has very little to do with reality. First, research and development (R&D) is a relatively small part of the budgets of the big drug companies—dwarfed by their vast expenditures on marketing and administration, and smaller even than profits. In fact, year after year, for over two decades, this industry has been far and away the most profitable in the United States. (In 2003, for the first time, the industry lost its first-place position, coming in third, behind “mining, crude oil production,” and “commercial banks.”) The prices drug companies charge have little relationship to the costs of making the drugs and could be cut dramatically without coming anywhere close to threatening R&D.

Second, the pharmaceutical industry is not especially innovative. As hard as it is to believe, only a handful of truly important drugs have been brought to market in recent years, and they were mostly based on taxpayer-funded research at academic institutions, small biotechnology companies, or the National Institutes of Health (NIH). The great majority of “new” drugs are not new at all but merely variations of older drugs already on the market. These are called “me-too” drugs. The idea is to grab a share of an established, lucrative market by producing something very similar to a top-selling drug. For instance, we now have six statins (Mevacor, Lipitor, Zocor, Pravachol, Lescol, and the newest, Crestor) on the market to lower cholesterol, all variants of the first. As Dr. Sharon Levine, associate executive director of the Kaiser Permanente Medical Group, put it,

If I’m a manufacturer and I can change one molecule and get another twenty years of patent rights, and convince physicians to prescribe and consumers to demand the next form of Prilosec, or weekly Prozac instead of daily Prozac, just as my patent expires, then why would I be spending money on a lot less certain endeavor, which is looking for brand-new drugs?4

Third, the industry is hardly a model of American free enterprise. To be sure, it is free to decide which drugs to develop (me-too drugs instead of innovative ones, for instance), and it is free to price them as high as the traffic will bear, but it is utterly dependent on government-granted monopolies—in the form of patents and Food and Drug Administration (FDA)–approved exclusive marketing rights. If it is not particularly innovative in discovering new drugs, it is highly innovative—and aggressive—in dreaming up ways to extend its monopoly rights.

And there is nothing peculiarly American about this industry. It is the very essence of a global enterprise. Roughly half of the largest drug companies are based in Europe. (The exact count shifts because of mergers.) In 2002, the top ten were the American companies Pfizer, Merck, Johnson & Johnson, Bristol-Myers Squibb, and Wyeth (formerly American Home Products); the British companies GlaxoSmithKline and AstraZeneca; the Swiss companies Novartis and Roche; and the French company Aventis (which in 2004 merged with another French company, Sanafi Synthelabo, putting it in third place).5 All are much alike in their operations. All price their drugs much higher here than in other markets.

Since the United States is the major profit center, it is simply good public relations for drug companies to pass themselves off as American, whether they are or not. It is true, however, that some of the European companies are now locating their R&D operations in the United States. They claim the reason for this is that we don’t regulate prices, as does much of the rest of the world. But more likely it is that they want to feed on the unparalleled research output of American universities and the NIH. In other words, it’s not private enterprise that draws them here but the very opposite—our publicly sponsored research enterprise.

Over the past two decades the pharmaceutical industry has moved very far from its original high purpose of discovering and producing useful new drugs. Now primarily a marketing machine to sell drugs of dubious benefit, this industry uses its wealth and power to co-opt every institution that might stand in its way, including the US Congress, the FDA, academic medical centers, and the medical profession itself. (Most of its marketing efforts are focused on influencing doctors, since they must write the prescriptions.)

If prescription drugs were like ordinary consumer goods, all this might not matter very much. But drugs are different. People depend on them for their health and even their lives. In the words of Senator Debbie Stabenow (D-Mich.), “It’s not like buying a car or tennis shoes or peanut butter.” People need to know that there are some checks and balances on this industry, so that its quest for profits doesn’t push every other consideration aside. But there aren’t such checks and balances.

2.

What does the eight-hundred-pound gorilla do? Anything it wants to.

What’s true of the eight-hundred-pound gorilla is true of the colossus that is the pharmaceutical industry. It is used to doing pretty much what it wants to do. The watershed year was 1980. Before then, it was a good business, but afterward, it was a stupendous one. From 1960 to 1980, prescription drug sales were fairly static as a percent of US gross domestic product, but from 1980 to 2000, they tripled. They now stand at more than $200 billion a year.6 Of the many events that contributed to the industry’s great and good fortune, none had to do with the quality of the drugs the companies were selling.

The claim that drugs are a $200 billion industry is an understatement. According to government sources, that is roughly how much Americans spent on prescription drugs in 2002. That figure refers to direct consumer purchases at drugstores and mail-order pharmacies (whether paid for out of pocket or not), and it includes the nearly 25 percent markup for wholesalers, pharmacists, and other middlemen and retailers. But it does not include the large amounts spent for drugs administered in hospitals, nursing homes, or doctors’ offices (as is the case for many cancer drugs). In most analyses, they are allocated to costs for those facilities.

Drug company revenues (or sales) are a little different, at least as they are reported in summaries of corporate annual reports. They usually refer to a company’s worldwide sales, including those to health facilities. But they do not include the revenues of middlemen and retailers.

Perhaps the most quoted source of statistics on the pharmaceutical industry, IMS Health, estimated total worldwide sales for prescription drugs to be about $400 billion in 2002. About half were in the United States. So the $200 billion colossus is really a $400 billion megacolossus.

The election of Ronald Reagan in 1980 was perhaps the fundamental element in the rapid rise of big pharma—the collective name for the largest drug companies. With the Reagan administration came a strong pro-business shift not only in government policies but in society at large. And with the shift, the public attitude toward great wealth changed. Before then, there was something faintly disreputable about really big fortunes. You could choose to do well or you could choose to do good, but most people who had any choice in the matter thought it difficult to do both. That belief was particularly strong among scientists and other intellectuals. They could choose to live a comfortable but not luxurious life in academia, hoping to do exciting cutting-edge research, or they could “sell out” to industry and do less important but more remunerative work. Starting in the Reagan years and continuing through the 1990s, Americans changed their tune. It became not only reputable to be wealthy, but something close to virtuous. There were “winners” and there were “losers,” and the winners were rich and deserved to be. The gap between the rich and poor, which had been narrowing since World War II, suddenly began to widen again, until today it is a chasm.

The pharmaceutical industry and its CEOs quickly joined the ranks of the winners as a result of a number of business-friendly government actions. I won’t enumerate all of them, but two are especially important. Beginning in 1980, Congress enacted a series of laws designed to speed the translation of tax-supported basic research into useful new products—a process sometimes referred to as “technology transfer.” The goal was also to improve the position of American-owned high-tech businesses in world markets.

The most important of these laws is known as the Bayh-Dole Act, after its chief sponsors, Senator Birch Bayh (D-Ind.) and Senator Robert Dole (R-Kans.). Bayh-Dole enabled universities and small businesses to patent discoveries emanating from research sponsored by the National Institutes of Health, the major distributor of tax dollars for medical research, and then to grant exclusive licenses to drug companies. Until then, taxpayer-financed discoveries were in the public domain, available to any company that wanted to use them. But now universities, where most NIH-sponsored work is carried out, can patent and license their discoveries, and charge royalties. Similar legislation permitted the NIH itself to enter into deals with drug companies that would directly transfer NIH discoveries to industry.

Bayh-Dole gave a tremendous boost to the nascent biotechnology industry, as well as to big pharma. Small biotech companies, many of them founded by university researchers to exploit their discoveries, proliferated rapidly. They now ring the major academic research institutions and often carry out the initial phases of drug development, hoping for lucrative deals with big drug companies that can market the new drugs. Usually both academic researchers and their institutions own equity in the biotechnology companies they are involved with. Thus, when a patent held by a university or a small biotech company is eventually licensed to a big drug company, all parties cash in on the public investment in research.

These laws mean that drug companies no longer have to rely on their own research for new drugs, and few of the large ones do. Increasingly, they rely on academia, small biotech startup companies, and the NIH for that.7 At least a third of drugs marketed by the major drug companies are now licensed from universities or small biotech companies, and these tend to be the most innovative ones.8 While Bayh-Dole was clearly a bonanza for big pharma and the biotech industry, whether its enactment was a net benefit to the public is arguable.

The Reagan years and Bayh-Dole also transformed the ethos of medical schools and teaching hospitals. These nonprofit institutions started to see themselves as “partners” of industry, and they became just as enthusiastic as any entrepreneur about the opportunities to parlay their discoveries into financial gain. Faculty researchers were encouraged to obtain patents on their work (which were assigned to their universities), and they shared in the royalties. Many medical schools and teaching hospitals set up “technology transfer” offices to help in this activity and capitalize on faculty discoveries. As the entrepreneurial spirit grew during the 1990s, medical school faculty entered into other lucrative financial arrangements with drug companies, as did their parent institutions.

One of the results has been a growing pro-industry bias in medical research—exactly where such bias doesn’t belong. Faculty members who had earlier contented themselves with what was once referred to as a “threadbare but genteel” lifestyle began to ask themselves, in the words of my grandmother, “If you’re so smart, why aren’t you rich?” Medical schools and teaching hospitals, for their part, put more resources into searching for commercial opportunities.

Starting in 1984, with legislation known as the Hatch-Waxman Act, Congress passed another series of laws that were just as big a bonanza for the pharmaceutical industry. These laws extended monopoly rights for brand-name drugs. Exclusivity is the lifeblood of the industry because it means that no other company may sell the same drug for a set period. After exclusive marketing rights expire, copies (called generic drugs) enter the market, and the price usually falls to as little as 20 percent of what it was.9 There are two forms of monopoly rights—patents granted by the US Patent and Trade Office (USPTO) and exclusivity granted by the FDA. While related, they operate somewhat independently, almost as backups for each other. Hatch-Waxman, named for Senator Orrin Hatch (R-Utah) and Representative Henry Waxman (D-Calif.), was meant mainly to stimulate the foundering generic industry by short-circuiting some of the FDA requirements for bringing generic drugs to market. While successful in doing that, Hatch-Waxman also lengthened the patent life for brand-name drugs. Since then, industry lawyers have manipulated some of its provisions to extend patents far longer than the lawmakers intended.

In the 1990s, Congress enacted other laws that further increased the patent life of brand-name drugs. Drug companies now employ small armies of lawyers to milk these laws for all they’re worth—and they’re worth a lot. The result is that the effective patent life of brand-name drugs increased from about eight years in 1980 to about fourteen years in 2000.10 For a blockbuster—usually defined as a drug with sales of over a billion dollars a year (like Lipitor or Celebrex or Zoloft)—those six years of additional exclusivity are golden. They can add billions of dollars to sales—enough to buy a lot of lawyers and have plenty of change left over. No wonder big pharma will do almost anything to protect exclusive marketing rights, despite the fact that doing so flies in the face of all its rhetoric about the free market.

As their profits skyrocketed during the 1980s and 1990s, so did the political power of drug companies. By 1990, the industry had assumed its present contours as a business with unprecedented control over its own fortunes. For example, if it didn’t like something about the FDA, the federal agency that is supposed to regulate the industry, it could change it through direct pressure or through its friends in Congress. The top ten drug companies (which included European companies) had profits of nearly 25 percent of sales in 1990, and except for a dip at the time of President Bill Clinton’s health care reform proposal, profits as a percentage of sales remained about the same for the next decade. (Of course, in absolute terms, as sales mounted, so did profits.) In 2001, the ten American drug companies in the Fortune 500 list (not quite the same as the top ten worldwide, but their profit margins are much the same) ranked far above all other American industries in average net return, whether as a percentage of sales (18.5 percent), of assets (16.3 percent), or of shareholders’ equity (33.2 percent). These are astonishing margins. For comparison, the median net return for all other industries in the Fortune 500 was only 3.3 percent of sales. Commercial banking, itself no slouch as an aggressive industry with many friends in high places, was a distant second, at 13.5 percent of sales.11

In 2002, as the economic downturn continued, big pharma showed only a slight drop in profits—from 18.5 to 17.0 percent of sales. The most startling fact about 2002 is that the combined profits for the ten drug companies in the Fortune 500 ($35.9 billion) were more than the profits for all the other 490 businesses put together ($33.7 billion).12 In 2003 profits of the Fortune 500 drug companies dropped to 14.3 percent of sales, still well above the median for all industries of 4.6 percent for that year. When I say this is a profitable industry, I mean really profitable. It is difficult to conceive of how awash in money big pharma is.

Drug industry expenditures for research and development, while large, were consistently far less than profits. For the top ten companies, they amounted to only 11 percent of sales in 1990, rising slightly to 14 percent in 2000. The biggest single item in the budget is neither R&D nor even profits but something usually called “marketing and administration”—a name that varies slightly from company to company. In 1990, a staggering 36 percent of sales revenues went into this category, and that proportion remained about the same for over a decade.13 Note that this is two and a half times the expenditures for R&D.

These figures are drawn from the industry’s own annual reports to the Securities and Exchange Commission (SEC) and to stockholders, but what actually goes into these categories is not at all clear, because drug companies hold that information very close to their chests. It is likely, for instance, that R&D includes many activities most people would consider marketing, but no one can know for sure. For its part, “marketing and administration” is a gigantic black box that probably includes what the industry calls “education,” as well as advertising and promotion, legal costs, and executive salaries—which are whopping. According to a report by the non-profit group Families USA, the for-mer chairman and CEO of Bristol-Myers Squibb, Charles A. Heimbold Jr., made $74,890,918 in 2001, not counting his $76,095,611 worth of unexercised stock options. The chairman of Wyeth made $40,521,011, exclusive of his $40,629,459 in stock options. And so on.14

3.

If 1980 was a watershed year for the pharmaceutical industry, 2000 may very well turn out to have been another one—the year things began to go wrong. As the booming economy of the late 1990s turned sour, many successful businesses found themselves in trouble. And as tax revenues dropped, state governments also found themselves in trouble. In one respect, the pharmaceutical industry is well protected against the downturn, since it has so much wealth and power. But in another respect, it is peculiarly vulnerable, since it depends on employer-sponsored insurance and state-run Medicaid programs for much of its revenues. When employers and states are in trouble, so is big pharma.

And sure enough, in just the past couple of years, employers and the private health insurers with whom they contract have started to push back against drug costs. Most big managed care plans now bargain for steep price discounts. Most have also instituted three-tiered coverage for prescription drugs—full coverage for generic drugs, partial coverage for useful brand-name drugs, and no coverage for expensive drugs that offer no added benefit over cheaper ones. These lists of preferred drugs are called formularies, and they are an increasingly important method for containing drug costs. Big pharma is feeling the effects of these measures, although not surprisingly, it has become adept at manipulating the system—mainly by inducing doctors or health plans to put expensive, brand-name drugs on formularies.

State governments, too, are looking for ways to cut their drug costs. Some state legislatures are drafting measures that would permit them to regulate prescription drug prices for state employees, Medicaid recipients, and the uninsured. Like managed care plans, they are creating formularies of preferred drugs. The industry is fighting these efforts—mainly with its legions of lobbyists and lawyers. It fought the state of Maine all the way to the US Supreme Court, which in 2003 upheld Maine’s right to bargain with drug companies for lower prices, while leaving open the details. But that war has just begun, and it promises to go on for years and get very ugly.

Recently the public has shown signs of being fed up. The fact that Americans pay much more for prescription drugs than Europeans and Canadians is now widely known. An estimated one to two million Americans buy their medicines from Canadian drugstores over the Internet, despite the fact that in 1987, in response to heavy industry lobbying, a compliant Congress had made it illegal for anyone other than manufacturers to import prescription drugs from other countries.15 In addition, there is a brisk traffic in bus trips for people in border states, particularly the elderly, to travel to Canada or Mexico to buy prescription drugs. Their resentment is palpable, and they constitute a powerful voter block—a fact not lost on Congress or state legislatures.

The industry faces other, less familiar problems. It happens that, by chance, some of the top-selling drugs—with combined sales of around $35 billion a year—are scheduled to go off patent within a few years of one another.16 This drop over the cliff began in 2001, with the expiration of Eli Lilly’s patent on its blockbuster antidepressant Prozac. In the same year, AstraZeneca lost its patent on Prilosec, the original “purple pill” for heartburn, which at its peak brought in a stunning $6 billion a year. Bristol-Myers Squibb lost its best-selling diabetes drug, Glucophage. The unusual cluster of expirations will continue for another couple of years. While it represents a huge loss to the industry as a whole, for some companies it’s a disaster. Schering-Plough’s blockbuster allergy drug, Claritin, brought in fully a third of that company’s revenues before its patent expired in 2002.17 Claritin is now sold over the counter for much less than its prescription price. So far, the company has been unable to make up for the loss by trying to switch Claritin users to Clarinex—a drug that is virtually identical but has the advantage of still being on patent.

Even worse is the fact that there are very few drugs in the pipeline ready to take the place of blockbusters going off patent. In fact, that is the biggest problem facing the industry today, and its darkest secret. All the public relations about innovation is meant to obscure precisely this fact. The stream of new drugs has slowed to a trickle, and few of them are innovative in any sense of that word. Instead, the great majority are variations of oldies but goodies—”me-too” drugs.

Of the seventy-eight drugs approved by the FDA in 2002, only seventeen contained new active ingredients, and only seven of these were classified by the FDA as improvements over older drugs. The other seventy-one drugs approved that year were variations of old drugs or deemed no better than drugs already on the market. In other words, they were me-too drugs. Seven of seventy-eight is not much of a yield. Furthermore, of those seven, not one came from a major US drug company.18

For the first time, in just a few short years, the gigantic pharmaceutical industry is finding itself in serious difficulty. It is facing, as one industry spokesman put it, “a perfect storm.” To be sure, profits are still beyond anything most other industries could hope for, but they have recently fallen, and for some companies they fell a lot. And that is what matters to investors. Wall Street doesn’t care how high profits are today, only how high they will be tomorrow. For some companies, stock prices have plummeted. Nevertheless, the industry keeps promising a bright new day. It bases its reassurances on the notion that the mapping of the human genome and the accompanying burst in genetic research will yield a cornucopia of important new drugs. Left unsaid is the fact that big pharma is depending on government, universities, and small biotech companies for that innovation. While there is no doubt that genetic discoveries will lead to treatments, the fact remains that it will probably be years before the basic research pays off with new drugs. In the meantime, the once-solid foundations of the big pharma colossus are shaking.

The hints of trouble and the public’s growing resentment over high prices are producing the first cracks in the industry’s formerly firm support in Washington. In 2000, Congress passed legislation that would have closed some of the loopholes in Hatch-Waxman and also permitted American pharmacies, as well as individuals, to import drugs from certain countries where prices are lower. In particular, they could buy back FDA-approved drugs from Canada that had been exported there. It sounds silly to “reimport” drugs that are marketed in the United States, but even with the added transaction costs, doing so is cheaper than buying them here. But the bill required the secretary of health and human services to certify that the practice would not pose any “added risk” to the public, and secretaries in both the Clinton and Bush administrations, under pressure from the industry, refused to do that.

The industry is also being hit with a tidal wave of government investigations and civil and criminal lawsuits. The litany of charges includes illegally overcharging Medicaid and Medicare, paying kickbacks to doctors, engaging in anticompetitive practices, colluding with generic companies to keep generic drugs off the market, illegally promoting drugs for unapproved uses, engaging in misleading direct-to-consumer advertising, and, of course, covering up evidence. Some of the settlements have been huge. TAP Pharmaceuticals, for instance, paid $875 million to settle civil and criminal charges of Medicaid and Medicare fraud in the marketing of its prostate cancer drug, Lupron.19 All of these efforts could be summed up as increasingly desperate marketing and patent games, activities that always skirted the edge of legality but now are sometimes well on the other side.

How is the pharmaceutical industry responding to its difficulties? One could hope drug companies would decide to make some changes—trim their prices, or at least make them more equitable, and put more of their money into trying to discover genuinely innovative drugs, instead of just talking about it. But that is not what is happening. Instead, drug companies are doing more of what got them into this situation. They are marketing their me-too drugs even more relentlessly. They are pushing even harder to extend their monopolies on top-selling drugs. And they are pouring more money into lobbying and political campaigns. As for innovation, they are still waiting for Godot.

The news is not all bad for the industry. The Medicare prescription drug benefit enacted in 2003, and scheduled to go into effect in 2006, promises a windfall for big pharma since it forbids the government from negotiating prices. The immediate jump in pharmaceutical stock prices after the bill passed indicated that the industry and investors were well aware of the windfall. But at best, this legislation will be only a temporary boost for the industry. As costs rise, Congress will have to reconsider its industry-friendly decision to allow drug companies to set their own prices, no questions asked.

This is an industry that in some ways is like the Wizard of Oz—still full of bluster but now being exposed as something far different from its image. Instead of being an engine of innovation, it is a vast marketing machine. Instead of being a free market success story, it lives off government-funded research and monopoly rights. Yet this industry occupies an essential role in the American health care system, and it performs a valuable function, if not in discovering important new drugs at least in developing them and bringing them to market. But big pharma is extravagantly rewarded for its relatively modest functions. We get nowhere near our money’s worth. The United States can no longer afford it in its present form.

Clearly, the pharmaceutical industry is due for fundamental reform. Reform will have to extend beyond the industry to the agencies and institutions it has co-opted, including the FDA and the medical profession and its teaching centers. In my forthcoming book, The Truth About the Drug Companies, I discuss the major reforms that will be necessary.

For example, we need to get the industry to focus on discovering truly innovative drugs instead of turning out me-too drugs (and spending billions of dollars to promote them as though they were miracles). The me-too business is made possible by the fact that the FDA usually approves a drug only if it is better than a placebo. It needn’t be better than an older drug already on the market to treat the same condition; in fact, it may be worse. There is no way of knowing, since companies generally do not test their new drugs against older ones for the same conditions at equivalent doses. (For obvious reasons, they would rather not find the answer.) They should be required to do so.

The me-too market would collapse virtually overnight if the FDA made approval of new drugs contingent on their being better in some important way than older drugs already on the market. Probably very few new drugs could meet that test. By default, then, drug companies would have to concentrate on finding truly innovative drugs, and we would finally find out whether this much-vaunted industry is turning out better drugs. A welcome by-product of this reform is that it would also reduce the incessant and enormously expensive marketing necessary to jockey for position in the me-too market. Genuinely important new drugs do not need much promotion (imagine having to advertise a cure for cancer).

A second important reform would be to require drug companies to open their books. Drug companies reveal very little about the most crucial aspects of their business. We know next to nothing about how much they spend to bring each drug to market or what they spend it on. (We know that it is not $802 million, as some industry apologists have recently claimed.) Nor do we know what their gigantic “marketing and administration” budgets cover. We don’t even know the prices they charge their various customers. Perhaps most important, we do not know the results of the clinical trials they sponsor—only those they choose to make public, which tend to be the most favorable findings. (The FDA is not allowed to reveal the results it has.) The industry claims all of this is “proprietary” information. Yet, unlike other businesses, drug companies are dependent on the public for a host of special favors—including the rights to NIH-funded research, long periods of market monopoly, and multiple tax breaks that almost guarantee a profit. Because of these special favors and the importance of its products to public health, as well as the fact that the government is a major purchaser of its products, the pharmaceutical industry should be regarded much as a public utility.

These are just two of many reforms I advocate in my book. Some of the others have to do with breaking the dependence of the medical profession on the industry and with the inappropriate control drug companies have over the evaluation of their own products. The sort of thoroughgoing changes required will take government action, which in turn will require strong public pressure. It will be tough. Drug companies have the largest lobby in Washington, and they give copiously to political campaigns. Legislators are now so beholden to the pharmaceutical industry that it will be exceedingly difficult to break its lock on them.

But the one thing legislators need more than campaign contributions is votes. That is why citizens should know what is really going on. Contrary to the industry’s public relations, they don’t get what they pay for. The fact is that this industry is taking us for a ride, and there will be no real reform without an aroused and determined public to make it happen.

  1. There are several sources of statistics on the size and growth of the industry. One is IMS Health (www.imshealth .com), a private company that collects and sells information on the global pharmaceutical industry. See www .imshealth.com/ims/portal/front/articleC/0,2777,6599_3665_41336931,00. html for the $200 billion figure. For further sources on this and other matters, see my book The Truth About the Drug Companies: How They Deceive Us and What to Do About It (to be published in August by Random House), from which this article is drawn.↩
  2. 2For a full picture of the special burden of rising drug prices on senior citizens, see Families USA, “Out-of-Bounds: Rising Prescription Drug Prices for Seniors” (www.familiesusa .org/site/PageServer?pagename=Publications_Reports).↩
  3. 3Sarah Lueck, “Drug Prices Far Outpace Inflation,” The Wall Street Journal, July 10, 2003, p. D2.↩
  4. 4On ABC Special with Peter Jennings, “Bitter Medicine: Pills, Profit, and the Public Health,” May 29, 2002.↩
  5. 5For the top ten companies and their recent mergers as of 2003, see www .oligopolywatch.com/2003/05/25.html.↩
  6. 6These figures come from the US Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group, Baltimore, Maryland. They were summarized in Cynthia Smith, “Retail Prescription Drug Spending in the National Health Accounts,” Health Affairs, January– February 2004, p. 160.↩
  7. 7For excellent summaries of public contributions to drug company research, see Public Citizen Congress Watch, “Rx R&D Myths: The Case Against the Drug Industry’s R&D ‘Scare Card,’” July 2001 (www.citizen.org); and NIHCM, “Changing Patterns of Pharmaceutical Innovation,” May 2002 (www.nihcm.org).↩
  8. 8This is probably an underestimate. One source that indicates it is at least this is CenterWatch, www.centerwatch .com, a private company owned by Thomson Medical Economics, which provides information to the clinical trial industry. See An Industry in Evolution, third edition, edited by Mary Jo Lamberti (CenterWatch, 2001), p. 22.↩
  9. 9Families USA, “Out-of-Bounds: Rising Prescription Drug Prices for Seniors.”↩
  10. 10Public Citizen Congress Watch, “Rx R&D Myths.”↩
  11. 11″The Fortune 500,” Fortune, April 15, 2002, p. F26.↩
  12. 12Public Citizen Congress Watch, “Drug Industry Profits: Hefty Pharmaceutical Company Margins Dwarf Other Industries,” June 2003 (www.citizen .org/documents/Pharma_Report.pdf). The data are drawn mainly from the Fortune 500 list in Fortune, April 7, 2003, and drug company annual reports.↩
  13. 13Henry J. Kaiser Family Foundation, “Prescription Drug Trends,” November 2001 (www.kff.org).↩
  14. 14FamiliesUSA, “Profiting from Pain: Where Prescription Drug Dollars Go,” July 2002 (www.familiesusa. org /site/DocServer/PReport.pdf?docID= 249).↩
  15. 15Patricia Barry, “More Americans Go North for Drugs,” AARP Bulletin, April 2003, p. 3.↩
  16. 16Chandrani Ghosh and Andrew Tanzer, “Patent Play,” Forbes, September 17, 2001, p. 141.↩
  17. 17Gardiner Harris, “Schering-Plough Is Hurt by Plummeting Pill Costs,” The New York Times, July 8, 2003, p. C1.↩
  18. 18For key information about the numbers and kinds of drugs approved each year, see the Web site of the US Food and Drug Administration (FDA), www .fda.gov/cder/rdmt/pstable.htm.↩
  19. 19Alice Dembner, “Drug Firm to Pay $875M Fine for Fraud,” The Boston Globe, October 4, 2001, p. A13.↩

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Posted 13 May 2011 — by James Street
Category Big Pharma, Clinical Trials, Ethics of Science, Finance and Politics of cancer research and treatment, Orphan Cancers

Updated: Thursday, 12 May 2011, 7:14 PM EDT
Published : Thursday, 12 May 2011, 7:10 PM EDT

By ROBIN SCHWARTZ
WJBK | myFOXDetroit.com

MARINE CITY, Mich. (WJBK) – The cancer survivors are young, beautiful, innocent children all born healthy, but suddenly thrust into a battle for their lives.

Their mothers recently spoke out a Marine City Commission meeting demanding answers.  In the last four years, five children, all from Marine City, have been diagnosed with the rare kidney cancer Wilms Tumor. The youngest, six-month-old Ireland Kulman, was just diagnosed in March.

Each year, only about 500 children in the U.S. get this cancer.  The odds of this happening in a city of 5,000 people are astronomical.

“The odds are just about one in 500-trillion, which to put that into perspective, that would be like buying the winning Mega Millions ticket two weeks in a row,” said math professor Scott Anderson.

Now, the Saint Clair County Health Department has said it’s not just Marine City.  They’ve confirmed three new Wilms Tumor cases, two in the Port Huron area, and one more in Richmond on the border of Saint Clair and Macomb counties.

FOX 2 also got a call from Carole Phillips, who lives in New Baltimore just 15 minutes away.  Her daughter is also a Wilms Tumor survivor diagnosed in 2005.  It’s not yet clear if her case is related.

“I firmly believe that there is a link.  The likelihood of it being a coincidence, I think, is non-existent,” she said.

“It breaks my heart and it blows my mind that there (are) so many cases,” said Kris Tranchemontagne.

She is one of the Marine City moms.  Her daughter was diagnosed in October 2008.  She said officials recently tested the area drinking water, but nothing unusual was found.  The troubling mystery remains.

So, where does the problem lie?  In the air?  In the water?  Somewhere else in the environment?  No one knows for sure, but the families immediately look with suspicion just a few miles north to Sarnia, Ontario, also known as “chemical valley.”

“They make 40-percent of the petrochemicals for all of Canada,” said St. Clair Channel Keeper Doug Martz.

“They’re definitely dumping chemicals.  There (are) spills constantly,” said Danielle Williams.

Her ten-year-old daughter is another Wilms Tumor survivor.  She brings an enlarged picture of “chemical valley” with her to every meeting.  It’s a place the Problem Solvers have highlighted before back in 2003 after the big blackout.  We reported on a massive spill of the cancer causing chemical vinyl chloride that went undetected for days.

The families are calling on the federal government to join the investigation.

The total number of local Wilms Tumor cases could continue to grow as more families come forward.

——

Dr. Jeffrey Taub, director of Hematology and Oncology at Children’s Hospital, joined Huel Perkins to talk about this story.  Click on the second video in the player above to watch their conversation.

Cancer Sleuths Uncovering DNA Mysteries for Novartis, Glaxo

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Posted 13 May 2011 — by James Street
Category Big Pharma, Big Pharma, Drug Companies, Epigenetics, Finance and Politics of cancer research and treatment, genetic research

Most existing cancer treatments either kill tumors outright with toxic chemotherapy or block mutated genes that fuel tumor growth. Now drugmakers including GlaxoSmithKline Plc (GSK), Eli Lilly & Co. (LLY), and Novartis AG (NOVN) are chasing a third approach: reprogramming aberrant DNA that can turn cells cancerous in the first place.

These new drugs exploit an emerging understanding of the epigenome, the molecular machinery that cells use to turn genes on and off, directing them when to produce proteins that carry out most functions of life. Celgene Corp. (CELG) last year generated $534 million in revenue from its epigenetic compound Vidaza, which adds months of life for patients with myelodysplastic syndrome, a leukemia-type disorder. Bloomberg Businessweek reports in its May 16 issue that the approach also underlies blood-cancer drugs from Eisai Co. and Merck & Co.

The bigger payday will come from drugs that treat the millions who suffer from more common forms of cancer, like those affecting the lungs, breasts, or prostate. In January, Epizyme Inc., a closely held company co-founded by H. Robert Horvitz, the Massachusetts Institute of Technology Nobel laureate, agreed to a deal worth as much as $650 million with London-based Glaxo to search for epigenetics drugs for cancer. Novartis, Glaxo, Indianapolis-based Lilly, and at least four venture-backed startups are also racing to devise cell-reprogramming drugs for more prevalent tumors.

“Every major company I know of has a program” in epigenetics, says Jean-Pierre Issa, an oncologist at the University of Texas MD Anderson Cancer Center in Houston.

Top Sellers

One reason: Cancer medicines are the world’s top-selling drug category, with $22.3 billion in U.S. sales last year, an increase from $15.8 billion in 2006, according to IMS Health Inc., a market research company in Norwalk, Connecticut.

A successful new compound based on innovative science can generate sales quickly. The last new approach to cancer targeting mutated or overactive genes led to drugs like Gleevec, a leukemia breakthrough sold by Basel, Switzerland-based Novartis, and New York-based Pfizer Inc. (PFE)’s Sutent for kidney cancer. Both drugs exceeded $1 billion in annual sales within 5 years of their debuts.

Scientists since the 1980s have focused on understanding how cancer is spurred by damage to DNA inside cells, such as the harm caused by smoking. Research over the last decade has found that defects in so-called epigenetic control molecules may be as important a cause of cancer as direct DNA damage, said Stephen Baylin, a cancer biologist at Johns Hopkins University in Baltimore. Baylin likens it to a computer malfunction caused by bad software instructions, rather than a hardware fault.

Bar Codes

In the last few years, researchers have discovered that there are hundreds of molecules that control genetic bar-code labels on DNA. Normally, these codes help stem cells develop a specialized identity to form tissue for muscle, skin or other organs, said C. David Allis, a biochemist at Rockefeller University in New York, and co-founder of Constellation Pharmaceuticals Inc., based in Cambridge, Massachusetts. In diseases such as cancer, some of the code appears to be damaged or altered.

Epigenetic molecules are faulty in 60 percent of patients with pancreatic neuroendocrine tumors, the type of cancer that Steve Jobs, Apple Inc. (AAPL)’s chief executive officer, has been treated for, Johns Hopkins researchers reported in the journal Science in March.

While scientists aren’t certain just how epigenetic medicines work, one effect they appear to have is to reactivate so-called tumor suppressor genes that keep cells from growing out of control.

Theory’s Promise

With epigenetic drugs, “the therapeutic concept is to revert those bar codes back to normal,” said Jonathan Yingling, vice-president for cancer research at Lilly. “It would be hard for you to find a drug company that is not investigating this.”

“If it lives up to its promise, it will make a significant impact on cancer,” said Dash Dhanak, who leads the GlaxoSmithKline cancer epigenetics effort.

The cancer epigenetics field started in the 1970s after an unexpected discovery by a young researcher testing an unproven drug from Czechoslovakia. Peter Jones, now director of USC Norris Comprehensive Cancer Center made a discovery that seemed outlandish at the time soon after arriving in Los Angeles in 1973 for a postgraduate fellowship having grown up in South Africa and Rhodesia.

While studying the effects of various experimental chemotherapy drugs, he stumbled onto one — called 5-azacytidine — with a surprising ability to turn precancerous mouse embryo cells into muscle cells. They literally would start twitching a couple weeks after treatment.

‘Elated’

“I was elated because we seemed to have the first drug capable of completely reprogramming cells,” he wrote in a 2011 essay. He first published the results in the journal Nature in 1977 and spent the next few years teasing out how the drug worked.

It turned out that it blocked the ability of cells to add chemical tags to strands of DNA. These tags, in effect tiny molecular bar codes, were found to block cells from activating genes.

In the mid-1980s, Baylin of Johns Hopkins started finding abnormally high levels of the gene-silencing bar codes in the DNA of tumors, including those in leukemia and lung cancer. Baylin and Jones proposed the abnormal bar codes could be an important cause of cancer.

“There was a huge amount of skepticism,” said Issa, who worked with Baylin at Johns Hopkins in the 1990s before moving to MD Anderson. Biologists “said we know what causes cancer, it is genetic changes and epigenetics is irrelevant.”

New Mechanism

In 1994, Baylin bolstered the theory by showing that a key gene involved in kidney cancer was turned off through the DNA reading process in 20 percent of human tumor samples tested, even though the gene was fully functional. This indicated to Baylin and others in the field that the bar code defects were an alternative mechanism for tumor cells.

By that time, Lewis Silverman, a hematologist at New York’s Mount Sinai School of Medicine started testing 5-azacytidine, the drug that would become Vidaza, in patients with myelodysplastic syndrome. The drug had been rejected by U.S. regulators for treating acute leukemia. Silverman used lower doses to reprogram the cells without killing them.

In 2001, the biotechnology company Pharmion Corp. obtained rights to the drug. Pharmion spent two years tracking down old patient records from Silverman’s studies, and used them to get Vidaza approved for myelodysplastic syndrome in 2004. Celgene bought Pharmion for $2.9 billion in March 2008 after the drug was shown to extend life of patients by nine months. Dacogen, a similar drug developed by SuperGen Inc. (SUPG) and marketed by Tokyo- based Eisai in the U.S. was approved in 2006.

Solid Tumors

The question now is whether epigenetic cancer drugs can move beyond their current niche in treating blood cancer to treat common solid tumors. “There is no reason why it shouldn’t work on solid tumors,” said Robert Weinberg, a researcher at MIT’s Whitehead Institute.

Faulty bar codes could prove “as important” as gene mutations as a cause of cancer, he said, adding that the next two or three years will give researchers a better sense of how broad a role the bar codes play. “There is a lot of excitement building because it is a new way in to target cancers,” said Jeff Porter, a research executive at Novartis.

One target for drugmakers is an enzyme called EZH2 that is overactive in breast cancer, prostate cancer, and other tumors. Constellation Pharmaceuticals and Epizyme are independently pursuing drugs in preclinical studies against the enzyme, while Glaxo plans human trials of its EZH2 blocker this year.

All Survived

In a 2010 study, Charles Roberts, a pediatric oncologist at Boston’s Dana-Farber Cancer Institute, created a strain of mice with a cancer-causing gene defect that is lethal within four months. Then he took mice with the same defect and inactivated EZH2. They all survived.

“It completely stops the cancer when we turn off EZH2,” said Roberts. “The drug companies were swarming all over me” when he presented the results at the American Association for Cancer Research conference in April.

Epigenetic drugs also may make tumors more sensitive to existing treatments, said Joanna Horobin, chief executive of venture-backed Syndax Pharmaceuticals in Waltham, Mass. In lab experiments, Syndax’s entinostat makes breast tumors more sensitive to hormone therapy by reprogramming estrogen receptors inside cells. Syndax “successfully completed” a 130-woman trial aiming to show that entinostat in combination with Aromasin slowed the progression of advanced breast cancer, Horobin said. It plans to begin a final-stage trial in breast cancer next year.

To contact the reporter on this story: Robert Langreth in New York at rlangreth@bloomberg.net

To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net

About Becker’s Hospital Review and ASC Communications

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Posted 12 Apr 2011 — by James Street
Category Big Pharma, Big Pharma, Cancer Journals, Finance and Politics of cancer research and treatment, Legal Issues

ASC Communications is the leading source of cutting edge business and legal information for hospital and health system leaders, owners and operators of ambulatory surgery centers and leaders of orthopedic and spine practices. ASC Communications takes advantage of multiple channels through which to reach these decision-makers of the hospital and outpatient surgical community, including: print magazines (Becker’s Hospital Review, Becker’s ASC Review and Becker’s Orthopedic & Spine Review); two industry-leading ASC conferences and a new hospital and health system conference; weekly e-newsletters; as well as www.BeckersHospitalReview.com, www.BeckersASC.com, www.BeckersOrthopedicandSpine.com and a variety of Webinars and teleconferences.


Publications

Becker’s Hospital Review. Becker’s Hospital Review is a bimonthly publication offering up-to-date business and legal news and analysis relating to hospitals and health systems. Our content is geared-toward high-level hospital leaders, and we work to provide valuable content, including hospital and health system news, best practices and legal guidance specifically for these decision makers. Each issue of Becker’s Hospital Review reaches more than 15,000 people, primarily acute care hospital CEOs and CFOs.

Becker’s ASC Review. Becker’s ASC Review is a bimonthly publication that offers general business, legal and clinical guidance on topics including joint-ventures, development and expansion, and regulatory and compliance issues; as well as analysis and insight for specialties including bariatrics, orthopedics/spine, gastroenterology, neurosurgery, pain management, ophthalmology, ENT and anesthesiology. The publication reaches a qualified audience of more than 25,000 key business decision holders, including surgeons, hospital administrators, medical directors, directors of surgery, ASC administrators and others involved in the rapidly growing field of outpatient surgery. Further, every ASC in the nation receives the ASC Review.

Becker’s Orthopedic & Spine Review. Becker’s Orthopedic & Spine Review is a bimonthly publication offering news and analysis on business and legal issues relating to orthopedic and spine practices. Each issue of the publication reaches an audience of more than 15,000 key ASC-industry orthopedic and spine practice decision makers including orthopedic and sports medicine physicians and surgeons and spine practice administrators.

 

Conferences

Hospital and health system conference. The first annual Hospitals and Health Systems: Improving Profitability and Business and Legal Issues Conference will occur in April 2009 in Chicago. The conference will feature industry leaders speaking on key business issues and will offer CME credit.


ASC conferences. ASC Communications also hosts two conference in Chicago, one in October that focuses on ASC development and profits, and one in June the focuses on orthopedics, spine, neurosurgery and pain management in ASCs. Each event offers CME credits and brings 500 to 600 attendees, attracting a great number of physicians who either own surgery centers or are considering developing or investing in surgery centers. In addition, numerous companies take advantage of exhibiting and sponsorship opportunities. With these conferences, ASC Communications provides the ideal opportunity for CEOs and the senior leadership of the largest and most successful ASC companies to come together with surgeons, administrators and owners of ASCs.


E-Weeklies

Becker’s Hospital Review E-Weekly. This weekly e-newsletter provides a round-up of the most relevant business and legal news affecting hospitals and the healthcare communities. Each issue provides links to numerous business, legal, safety and regulatory news and analysis from the past week as well as Becker’s Hospital Review’s most popular feature articles, including our “people to know” and “hospitals to know” lists. If there’s news that matters to hospitals and health systems, it’s sure to be found in Becker’s Hospital Review E-Weekly.


Becker’s ASC Review E-Weekly. This weekly e-newsletter provides a round-up of the most relevant industry business and legal news affecting the outpatient surgery and healthcare communities. Each issues provides links to both news and analysis as well as Becker’s ASC Review’s most popular feature articles, including our “people to know” and “hospitals to know” lists. When business, legal and regulatory news breaks, it’s sure to be reported in the Becker’s ASC Review E-weekly.


Becker’s Orthopedic & Spine Review E-Weekly. This weekly e-newsletter provides a round-up of the most relevant business and legal news affecting physicians and administrators of orthopedic and spine practices. Each issue provides links to numerous business, legal, safety and regulatory news and analysis from the past week as well as Becker’s Orthopedic & Spine Review’s most popular feature articles. If there’s news that matters to orthopedic and spine practices, it’s sure to be found in Becker’s Orthopedic & Spine Review E-Weekly.

 

Web sites

ASC Communication’s Web sites, www.BeckersASC.com, www.BeckersHospitalReview.com and www.BeckersOrthopedicandSpine.com, are a one-stop shop for information for ASCs, hospitals and health systems and orthopedic and spine practices. The sites feature archived issues of Becker’s ASC Review, Becker’s Hospital Review and Becker’s Orthopedic & Spine Review, archived e-zines, conference brochures, white papers authored by expert sources and breaking business and legal news relevant to the healthcare community. Each Web site also includes specialty channels, which provide more in-depth coverage into critical topics such as Stark Act and Anti-Kickback, valuation, anesthesia, specialties and more. They are a key resource for healthcare leaders who want to have all that ASC Communications offers at their fingertips. Each Web site also includes specialty channels, which provide more in-depth coverage into critical topics such as Stark Act and Anti-Kickback, valuation, anesthesia, specialties and more.

Webinars and audio conferences

Industry experts present on a wide variety of topics, providing insiders’ views of what it takes to succeed in ASC development and operations across a wide variety of specialties and regarding any number of regulatory and clinical issues. The flexible formats mean fresh content for attendees, who can join the educational sessions without leaving the comfort of their facilities.

To receive the latest hospital and health system business and legal news and analysis from Becker’s Hospital Review, sign-up for the free Becker’s Hospital Review E-weekly by clicking here.

 

More Crony Capitalism at the FDA

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Posted 10 Apr 2011 — by James Street
Category Big Pharma, Big Pharma, Ethics of Science, Finance and Politics of cancer research and treatment

ALLIANCE FOR NATURAL HEALTH – usa

November 2, 2010

Handshake. Meeting two businessmen. Isolated 3D imageThree years ago a government report found the FDA completely lacking in scientific expertise. The agency’s response? Hire scientists from Big Pharma!

The sixty-page 2007 report, FDA Science and Mission at Risk also said the agency “cannot fulfill its mission” because its scientific base was weak and lacked sufficient capability. In response to this and many other failures, we launched ReformFDA.org, our campaign to completely reform and restructure the US Food and Drug Administration.

Now that three years have passed, instead of reinforcing its own scientific arsenal, FDA’s response is to spend $25 million to collaborate with outside scientists, including drug industry scientists and other scientists who are funded by Pharma. The agency’s $4 billion budget for the fiscal year that began October 1 includes a $25 million budget request to build additional partnerships with academia (heavily financed these days by drug company money), government agencies—and the pharmaceutical industry itself.

As the Associated Press notes, the FDA has already instituted a series of user fee programs in which drugmakers and medical device makers help pay for the agency’s review of their products. FDA Commissioner Margaret Hamburg stated that the new budget item will improve scientific standards, which will in turn help speed up the approval of new drug products.

So the FDA receives money from drug companies to review their products, and now will rely increasingly on drug company scientists to advise them about science? An old Latin phrase springs to mind: Ovem lupo commitere. It means “to let a wolf guard the sheep.”

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